Golar LNG

Delivering the World’s First Floating Storage and Regasification Units

Blake Blackwell 7 October 2009Vice President of Business Development Golar LNG Energy

High PressureGas Manifolds

New Lower Pressure In- Tank Pumps

LNG Loading Arms

Source: Golar LNG

Floating Storage and Regasification – The Building Blocks 2

Regas trains with HIPPS and Gas Metering

Mooring System

SeawaterPumpsTurbo

Generators

LNG (Un)loading Arms

LNG Loading Arms

HP Gas TransferLNG Shuttle Carrier FSRU

Source: Golar LNG/ / Picture copyright Petrobras

Golar Spirit – World’s First FSRU - Pecem, Brazil 3

Source: Golar LNGSource: Golar LNG/ Courtesy of and copyright Petrobras

Golar Winter – World’s Second FSRU – Guanabara Bay, Brazil 4

5 Years Ago - only 2 Floating Regasification projects

Source: Courtesy of Wood Mackenzie / Golar LNG

In 2004, potential LNG Floating LNG storage and regasification projects were a new concept…

ExcelerateGulf Gateway

OLT-OLivorno

5

…but by 2009, 7 projects were operational, a further 4 had been formally sanctioned, and many more had been proposed

Locations where further projects have been proposed

Other Industry Operational / Committed

Golar Operational / Committed

Petrobras- VT1

Petrobras- VT2

Gulf Gateway

Northeast GatewayNeptune Project

Bahia Blanca

Teesside

Livorno

Dubai

Mejillones

Kuwait

Today – Proven Progress / Firm Demand for More

Source: Courtesy of Wood Mackenzie /Golar LNG

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•

• Proven / improved technology • Accepted / promoted by Oil Majors• Avoids local opposition (NIMBY)

• Seasonal / intermittent markets• Can be relocated • Possible flexibility as LNGC and/or FSRU at other location

• Low cost / fast start-up• Rapid access to high value gas markets• Interim solution

ECONOMIC

FLEXIBLE SOLUTION

ACCEPTEDWhy?

Economic, accepted, and flexible: the business case for floating storage and regasification is compelling

Floating Regas – Economic, Accepted, and Flexible

Source: Golar LNG

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• A solution in 2 years rather than 3 to 5 years from FID

• Less risk of delays related to land acquisition

• Reduced challenges with permitting

• More difficult in the current world economy to obtain extra funding (~$200-300M USD)

• FSRU Owner responsible for operations

• Industry estimates suggest FSRU terminal up to ~50%-75% less expensive

• Recent 3 MTA onshore Singapore Terminal estimated to cost $750M to $1 Billion USD(1)

Floating Regas Offers Cost/Schedule Benefits vs. Land Based Terminal

LNG importers are seriously considering floating storage and regasification as an import solution

Source: Golar LNG

8Note: (1) Wood Mackenzie / Reuters

Non-OECD LNG Demand is no exception to this trend…

Source: Wood Mackenzie / Golar LNG

75% of global GDP is OECD but decreasing as the emerging and transitional countries increase their share

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NON OECD OECD

OECD vs Non OECD GDP

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20 Countries

22 Countries

LNG Demand by Status OECD vs Non-OECD LNG Demand

Non-OECD countries increasing LNG demand and faster than OECD

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2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020m

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23 Countries

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CAGR 12%

CAGR 6%

In 2009, Non-OECD members accounted for 13% of Global LNG demand. This is forecast to increase to over 22% in 2020

The number of LNG importing countries is forecast to grow rapidly, with many of the new importers being Non-OECD

In 2009, there were 22 countries importing LNG, this is expected to increase to 42 by 2020

Future Importer (Planned)Future Importer (Project Under Development)Existing Importer

Non OECD

OECD Members

Source: Wood Mackenzie / Golar LNG

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Petrobras- VT1

Petrobras- VT2

Gulf Gateway

Northeast GatewayNeptune Project

Bahia Blanca

Teesside

Livorno

Dubai

Mejillones

Kuwait

Source: Wood Mackenzie LNG Tool August 2009, Wood Mackenzie / Golar Estimates

Selected projects only

Of the 20 future LNG importing countries, 14 are non OECD, 10 of which have already committed to, or are planning, floating solutions

South Africa….Floating regas proposed to help alleviate the current electricity shortfalls and as a potential longer-term energy security option

Uruguay….Expected to solicit Invitations to Bid on a floating regas solution to meet power demand

Israel…Prequalification Document issued in 2009 to be followed by an Invitation to Bid in 2010 for an offshore LNG terminal. Despite a recent gas discovery, Israel sees benefit in security of supply via linkage to global LNG market

Indonesia - Java…May use floating regas to link Indonesia's LNG supply projects with the domestic market. Possible additional requirement in Sumatra

Dubai…Golar Freeze currently undergoing conversion to FSRU with commissioning in 2010

Jamaica….Government of Jamaica continues to show interest in a floating regas project

Locations where further projects have been proposed

Other Industry Operational / Committed

Golar Operational / Committed

Future floating regas solutions are primarily in Non-OECD countries 11

The characteristics of FSRU projects make them well suited to both OECD and non OECD countries

• A more cost effective way to meet low demand or to ‘grow into’ LNG

• Can be relocated if demand is not sustainable over the long-term

• Reduced financing requirement; no need to build storage tank

• More suitable to less stable environments; Can mitigate security concerns

• Quicker to develop than land based facilities

• This can be beneficial where a short to medium term opportunity exists

• This may be particularly beneficial in this environment where surplus supply exists

• Can support LNG trading strategies – low cost option to access a market

Floating regasification – Strong fit in developing markets

Source: Wood Mackenzie / Golar LNG

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• Moss Containment• 5.0 bcm / year• Offshore• Side by side LNG transfer • Gas risers to subsea pipeline• Open Loop

FSRU projects to date have been focused on tailoring converted LNGC to customer requirement

Client Defined- No such thing as a generic FSRU

Source: Golar LNG

• Moss Containment• 2.5 bcm / year• Near Shore (Existing Pier)• Over jetty LNG transfer • HP arms on pier• Closed Loop

Petrobras –Pecem (Golar Spirit)

Petrobras – Rio (Golar Winter)

• Moss Containment• 4.0 bcm / year• Near Shore (New Pier)• Side by side LNG transfer• HP arms on jetty• Open Loop

DUSUP – Jebel Ali (Golar Freeze)

• Membrane Containment• 5.1 bcm / year• Near Shore (New Pier)• Over jetty LNG transfer• HP arms on jetty• Open / Closed Loop

OLT-O - Livorno (Golar Frost)

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SUPPORT DEFINITION SITINGPROJECT

DEVELOPMENT CAPABILITY

• A Clear Mandate / Strong Support Base– Clear project drivers / Support of government and/or strong energy partner

• Project Functional Requirements Definition– Regas Rate / Vaporization / Storage / Availability / Permitting / Emissions

• Siting of Vessel– Infrastructure requirements / Environmental conditions (including sea state, wind, etc)

• Full Chain Project Development Capability– Scope may include LNG Sourcing + FSRU + Downstream Infrastructure + Gas Sales

• The Gas Offtaker – Establishes Foundation– Sets ‘bearable LNG price’ / Normally key to successful project financing

GAS OFFTAKER(S)

Source: Golar LNG

FSRU – Simple in Principle – Complex in Execution 14

LNG Shuttle Carrier

FSRU

HP Gas Transfer

LNG Loading Arms Regasification

Source: Golar LNG/ / Picture copyright DUSUP/Shell

FSRU – Simple in Principle – Complex in Execution 15

Source: Golar LNG/ / Picture copyright DUSUP/Shell

FSRU – Simple in Principle – Complex in Execution 16

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AVAILABLEASSETS

DEEP  LNG EXPERIENCE

TECHNICAL  AND MARINE CAPABILITY

PROJECT MANAGEMENT CAPABILITY

SPEED/FLEXIBILITY

FINANCIALSTRENGTH

Source: Golar LNG

FSRU Provider – Simple in Principle – Complex in Execution 17

FSRU – Simple in Principle – Complex in Execution 18

Source: Golar LNG

Source: Golar LNG

FSRU – Simple in Principle – Complex in Execution

Source: Golar LNG

19

Source: Golar LNG

FSRU – Simple in Principle – Complex in Execution

Source: Golar LNG

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Source: Golar LNG

FSRU – Simple in Principle – Complex in Execution Source: Golar LNG

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• The only company to deliver a floating regas projects based on converting an LNGC

• Spirit – operating; Winter – operating; Freeze – conversion

• Dubai Government selected Golar for sole source award

• Track record of delivering projects on time (~ 20 to 24 months from FID)

• Golar approach based on tailoring solution to the customer requirements

• Accepted solutions: Class Society; Banks; Petrobras; Shell

• Full chain participant: Liquefaction; Shipping; FSRUs

• Supported by Fredriksen Group: financial capability; partners; technology; speedSource: Golar LNG

FSRU – Simple in Principle – Complex in Execution 22

Golar restructured to create a strong platform for future growth

Our success in FSRUs has helped provide a platform for growth for our longer term ambitions as a midstream LNG player. A restructure improves focus/execution

• 2 LNG carriers and 3 FSRU units on long term charter

• Fwd revenues of $ 1.9 billion• Limited Capital Expenditures • High dividend capacity

• 4 modern LNG carriers • 3.5 Moss LNG vessels, ideal

conversion candidates• Project portfolio w/upside• Proven track record

Golar LNG Energy Ltd. New Business Development

74%

Production & Liquefaction

Shipping & Trading Regasification

Source: Golar LNG

100%

Golar LNG Ltd.Long Term Contracts

Golar LNG Ltd. 

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LNG Ltd.; Golar LNG Energy, and Arrow Energy JV

Land based liquefaction at Fisherman’s Landing, Gladstone, Queensland, Australia

Small scaleable LNG plant (~1.5 MTA) provides fast start up and low capex

Significant expansion opportunities; first mover advantage in prime location

Gas supply HOA with Arrow – 12 years’ at full capacity

Golar LNG Energy HOA for 100% of LNG offtake - HOA signed with Toyota

Two LNG carriers for transportation

Small Scale Liquefaction - Access to Molecules provides further upside

Golar LNG Energy and partners have made material progress on the world’s first coal bed methane based LNG project

Source: Golar LNG

24

Implementing the Midstream Strategy

Source: Golar LNG / Copyright LNG Ltd

25

JV with Thailand’s PTT Exploration and Production

Global cooperation on FLNG / Share risk and reward

PTTEP acquired Coogee Resources in Q1 2009 with gas fields off NW Australia

Joint Study agreement (FEED) and HOA signed

Circa 1 mtpa – 1.5 mtpa

Floating Liquefaction - Access to Molecules provides further upside

Golar LNG Energy is progressing plans in Floating LNG production (FLNG) to capture value of underdeveloped and stranded gas reserves

Source: Golar LNG

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Thank You

Source: Golar LNG/ / Picture copyright Petrobras

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Small Scale Liquefaction - Access to Molecules provides further upsideSource: Golar LNG

Capacity CurrentShip Ownership Built m3 Containment Charterer 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

GOLAR LNG GROUP

Methane Princess 100% 2003 138,000 Membrane BG Group

Golar Winter 100% 2004 138,000 Membrane Petrobras PETROBRAS (FSRU)

Golar Spirit 100% 1981 129,000 Moss Petrobras PETROBRAS (FSRU)

Golar Mazo 60% 2000 135,000 Moss Pertamina

Golar Freeze 100% 1977 126,000 Moss BG Group DUBAI SUPPLY AUTHORITY (FSRU)Intention to exercise option to acquire Golar Freeze from Golar LNG Energy after conversion.

Ebisu Chartered in 2008 147,200 Moss Spotuntil 2010

GOLAR LNG ENERGY GROUP

Khannur 100% 1977 125,000 Moss BG Group

Gimi 100% 1976 125,000 Moss BG Group

Hilli 100% 1975 125,000 Moss Conversion

Gracilis 100% 2005 140,000 Membrane Shell

Grandis 100% 2006 145,700 Membrane Shell

Granosa 100% 2006 145,700 Membrane Shell

Golar Arctic 100% 2003 140,650 Membrane Spot

Gandria 50% 1977 126,000 Moss Conversion

Options Spot Yard Conversion Held for Conversion

PERTAMINA (LNGC)

BG GROUP (LNGC)

BG GROUP

BG GROUP

SHELL

SHELL

SHELL

BG

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