The World First Ever Very Large Ethane Carrier (VLEC)

4th April 2017

Gastech 2017, Tokyo

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This document contains information resulting from testing, experience and know-how of

GTT, which are protected under the legal regime of undisclosed information and trade

secret (notably TRIPS Art. 39) and under Copyright law. This document is strictly

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for any purpose, without express prior written authorization of GTT. Any violation of this

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AGENDA

GTT in brief

US Ethane export opportunity

Trading Ethane : Shipping capacity

Technical requirements & Challenges of the World’s First Ever

VLEC

Status and lesson learned

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Company overview1

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An engineering company with more than 50

years of experience in the design of the

Membrane Cargo Containment Systems

GTT is a public company listed on the

Euronext Stock Exchange (Paris)

Around 358 highly qualified people (1), present

worldwide

GTT at a glance

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(1) As at 31st December 2016

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GTT achievements : several World First

1964 –World 1st Membrane ship delivered

1981 –World 1st Membrane LNG tank and largest LNG tank capacity at this time

2005 –World 1st FSRU delivered and first LNG operations in open seas

2007 ~2010 – Delivery of the World largest LNG Carriers

(31 Q-Flex and 14 Q-Max)

2011 to 2012 –World 1st

FLNGs built with GTT systems.

2016 –World first VLEC delivered

1972 –World 1st Membrane onshore tank, still in operation

today

1996 –World Largest onshore tank delivered (200 000 m3)

2005 – 100th ship delivered

2009 – 200th Ship delivered

2012 –World 1st LNG Carrier sails thru the Arctic North East

passage

2017 –World 1st LNG bunker barge to be delivered

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US Ethane export opportunity 2

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Shale boom driving US ethane surplus

Beyond 2022, a large increase of ethane surplus is estimated,

which could be added to the seaborne market.

US ethane supply/demand forecast(inclusing potential ethylene projects)

Source: Poten & Partners, September 2016

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Why exporting Ethane is so strategic?

Raw material for ethylene

production for chemical

application

Exporting ethane requires

a significant level of

infrastructure

In competition with

Naphtha, not anymore the

dominant petrochemical

feedstocks

Depending on the each project characteristics and the linkage

formula to price ethane; & above all, key enterprising and

visionary players are willing to develop the market

NW Europe ethylene plant incremental margins

Source: Poten & Partners, September 2016

Projects are currently re-materializing, as evidenced by current

tenders for VLECs

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Trading Ethane : Shipping capacity3

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Gas carrier fleet in 2014

Vessel Type

(Cbm) Number of Vessels incl on order* LPG Ammonia Petchem C2 Ethane

Max

Length

>60,000

Very Large Gas

Carrier

Fully-Refrigerated 258 760ft

40,000-59,999

Large Gas Carrier

Fully-

Refrigerated24

25,000-39,999

Medium Gas

Carrier

Fully-

Refrigerated106 590ft

15,000-24,999

Handysize Gas

Carrier

Semi-

Refrigerated

Fully-

Refrigerated

129 525ft

5,000-14,999

Small Gas Carrier

Semi-

Refrigerated

Pressurised

348

<4,999

Small Gas CarrierPressurised 683

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X

X

X

X

X

X

In 2014, no ship above 25k can carry Ethane

VLEC size was just 3 times bigger than largest Ethane ship !

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Largest Semi-Ref LEG delivered in 2016

ABS classed “Navigator Aurora”. (Source: Navigator Gas/Borealis, credits: Morgan Hermansson)

37,500m³ total Cargo volume. Type C tanks. Built in JiangNan, China

Quadri-fuel Engine, MDO/MGO/LNG and Ethane ready

4 ship ordered in 2014. 2 delivered in 2016. 2 to be delivered in 2017

Size limit for technically viable and economical type C carrier

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TECHNICAL REQUIREMENTS & CHALLENGES OF THEWORLD’S FIRST VLEC

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General Layout of the VLEC

GTT’s Mark III Flex

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IGC code tanks classification

Independent

self-supportingIntegrated

Type AAtmospheric

Full 2ndary barrier

Type BAtmospheric

Partial 2ndary barrier

Type CPressurized

No 2ndary barrier

MembranesAtmospheric

Full 2ndary barrier

Prismatic SPBIHI (JAP)

NO technologies MARK technologies

Many competitorsLNT-A-BOXLNG New Technologies (SGP)

Key VLEC equipment : The cryogenic tanks

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Why not keeping same type A technology from VLGC ?

Self supporting type A tank

(primary container)

Hull(secondary

container)

According to IGC Code : gas lower than -55°Cdouble hull + sec. barrier

Type A Ethane would be:

• Primary self supported tank

• +double hull

• +secondary insulation

• +secondary barrier

Never

made

Not economical and too longcompared to other tank technologies

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Tank technology comparison

Membrane Type AType B

prismatic Type B Moss Type C

Pros

• Extensive experience on LNG

carriers

• Light and best space efficient

volume occupation

• Offered by several shipyards in

Japan, Korea and China

• Most cost & schedule

competitive tank type for

VLEC size

• Compatible for LPG, Ethylene

and LNG with no extra cost

• Extensive experience in

type- A prismatic for

VLGC

• Very robust

• Good space efficiency

• Centerline bulkhead

prevents sloshing

• Very robust

• Good space efficiency

• Only partial

secondary barrier is

required

• Centerline bulkhead

prevents sloshing

• Very robust

• Extensive

experience on LNG

carriers

• Only partial

secondary barrier

is required

• No bulkhead

• Tank shape

prevents sloshing

• Very robust

• Can maintain

pressure

• No secondary barrier

required

• No double hull

required

Cons• Full width prone to sloshing

• Partial filling restrictions

• Requires an

independent secondary

barrier

• Still under development

for cryogenic gases

below -55°C.

• No ship currently in

operation for gases

colder than -55°C

• Higher CAPEX and

OPEX

• Very limited

experience

• Technology and

experience only

available in Japan

• Higher CAPEX and

OPEX

• Very poor space

efficiency

• Technology and

experience mainly

available in Japan

• Very poor space

efficiency

• Very heavy.

• Not economical for

VLGC size

Membrane are type B are the two main solutions for a VLEC

GTT Membrane has been selected for 1: Safety & track record; 2:Cost & Schedule

advantage and 3: wide offering from several shipyards.

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Membrane Tank: Same design than LNG Carrier? Tank similar than Membrane LNG tank? Several challenges!

Change from one unique cargo to 6 cargoes!

LNG to Propylene : + 40% density ; Sloshing impact : + 20%

Full review of GTT designs had been made, with AIP of all

classification societies

1st use of GTT Membrane “Mark III Flex High Density”

Cargo type LNG Ethylene Ethane Propylene Propane n-Butanei-Butane / n-Butane mix

Boiling point(@1,06 bar abs)

≈ -161 ⁰C ≈ -106 ⁰C ≈ -89 ⁰C ≈ -47 ⁰C ≈ -44 ⁰C ≈ -0,5 ⁰C ≈ -6 ⁰C

Liquid phase density(@boiling point)

≈ 450 kg/m³ ≈ 569 kg/m³ ≈ 547 kg/m³≈ 607 kg/m³

≈ 583 kg/m³ ≈ 601 kg/m³ ≈ 597 kg/m³

Vapor phase density(@boiling point)

≈ 1,9 kg/m³ ≈ 2,0 kg/m³ ≈ 2,1 kg/m³ ≈ 2,4 kg/m³ ≈ 2,4 kg/m³ ≈ 2,8 kg/m³ ≈ 2,9 kg/m³

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Pump type

Two pump types were considered

Submerged pump (similar to LNG)

Deep well pump (similar to LPG)

GTT has developed two designs

With Std submerged pump

With Deep well pump and sump well

Deep well pump is maintenance free inside

the tank

However, no reference of in Ethane/LPG

inside the membrane tank

Proven Design of conventional submerged

pump was selected

Tripod mas t with deep well pump (in red)

Sump well design with Membrane tank

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Reliquefaction system

Equipped with full re-liquefaction of the BOG, similar to VLGC

Cascade liquefaction technology, widely used on Ethylene carriers

Key challenge : Unlike Ethylene, Commercial Ethane composition is variable

Reliquefaction needs to be customized for Ethane trade

One out of three re-liquefaction system skids for each vessel

(Source: Wartsila Gas Solutions)

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Status and lesson learned 5

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World First Ever VLEC : Ethane Crystal

The “Ethane Crystal” during Sea trial, near Goeje Island, Korea

Gas trial in 2 steps : with Propane in Korea, and Gap trial between

Ethane and Propane in US

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Lesson learned

First cargos have been successfully loaded at Morgan’s point

(TX) and delivered in India!

Initial filling level limitation (no filling between 10%~70%) can be

down to 10~50% thanks to containment system reinforcement

Further improvements VLEC can be even larger with same overall dimensions !

Between 90k and 95k Membrane VLEC are offered to the market now

Ethylene & LNG tank compatible at marginal cost

To carry Ethylene in one tank for example

To convert the VLEC into a LNG FSU or FSRU

Or even a full LNG carrier

LNG carrier of 80~100,000m3 are not popular so far

However, several utilities are considering this size because of draft

limitation, regulation volume limitation, and short route LNG voyage

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Conclusion

Ethane trade in large quantity is new. New ship type of Mid-size

and Very Large size had been made in purpose.

VLEC are compact and multi-cargoes to trade various

petrochemical products

World First Ever Ethane Carrier has been delivered in Nov 2016.

Last ship of the series will be delivered tomorrow! (5th April 2017)

“Ethane Crystal” recognized as one of the top five of the “Great

Ships of 2016” by the prestigious “Maritime Reporter &

Engineering News”.

More new generation of VLEC should be sanctioned in 2017

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Thank you for your attention !

Adnan EzzarhouniGeneral Manager , GTT China ; aezzarhouni@gtt.fr

Patrick JanssensVP, Global Gas Solutions – Global Marine, ABS ; Pjanssens@eagle.org

Francois DurandInnovation Division - Project Leader, GTT ; fdurand@gtt.fr

Mélodie NorisBusiness Development Manager, GTT ; mnoris@gtt.fr