The Changing Role of LNG Winds of Change in Shipping Conference Langley Meek February 19, 2014

1. The Changing Role of LNGWinds of Change in Shipping ConferenceLangley MeekFebruary 19, 2014 GDF SUEZ GasNA LLC

2. Disclaimer Tug Roundtable

3. GDF SUEZA World Leader in LNG • About GDF SUEZ • Founded in 1822; predecessor company constructed the Suez Canal in 1858 • No. 1 independent power producer (IPP) in the world • 219,300 employees in nearly 70 countries • Global LNG Activities • 3rd Largest LNG Portfolio in the World • 18 LNG carriers in operation including 16 tankers and 2 shuttle regasification vessels • A supply portfolio of 16.5 million metric tons per year from 6 countries • Largest supplier in the Atlantic Basin • In North America • Everett, MA facility has delivered over 3 TCF of LNG since 1971 • Selling LNG for transportation applications since 2011 • Ongoing development projects for bunkering and LNG infrastructure at ports

4. Why are we talking about LNG? • Natural gas is an abundant, domestically produced fuel • We have significant reserves of natural gas due to our ability to extract from shale; US will be a net exporter • LNG is a cleaner fuel • Lower SOx, NOx, CO2 and particulate emissions • Meets current and future emissions requirements both in Emissions in in ECAs and for global trade • But really: The desire to use LNG as fuel is driven by PRICE • The spread between oil and natural gas has widened. North American natural gas prices are forecasted to be significantly cheaper than global oil and domestic diesel prices. • US produced LNG prices are forecasted to be much less expensive compared to Ultra Low Sulfur Diesel. High demand for ULSD and constrained refining capacity puts upward pressure on its cost.

5. U.S. Imports of LNG – Changing Market • With large shale gas production and increased global demand, U.S. imports of LNG have declined significantly • Except for New England, LNG imports into the U.S. have stopped • The U.S. LNG fuels market must compete with global demand to entice imports

6. The Export Situation • Enormous liquefaction capacity is coming online, but it is dedicated to global exports, not the domestic market • Export projects financed and built on the basis of 20 year commitments • Very low probability that these plants will make LNG available outside of long term contracts and significant volume commitments • They are not optimized to allow for bunkering or loading small vessels with LNG • Hierarchy of flows pulls LNG away from the domestic fuels market

7. Planned Liquefaction for the Domestic LNG Fuels Market • Domestic liquefaction plants can be better suited to serve the emerging fuels market because they don’t have to compete with global prices which can often draw LNG away from the U.S. • There is significant interest in providing a domestic solution • 250 BCF/year planned by various parties • Existing plants are being expanded to satisfy the growing needs of the transportation market • Applied (AZ), Clean Energy (CA) are adding capacity to serve growing trucking demand • New plants are being built to serve new LNG fuels markets • Shell’s Sarnia and Geismer plants are purpose-built for the marine market growing on the Great Lakes and Gulf Coast • Stabilis’ plants are serving the E&P business growing along shale plays

8. Existing Liquefaction • 3 Main Categories • Utility Peak-shavers that are dedicated to serving utility customers • They do not have the ability to do anything with their LNG other than serve their commitments • Utility Peak-shavers that have some excess capacity that they can sell on an interruptible basis • Not reliable supply because their first priority is to serve their utility customer’s needs – not other contracts • Purpose-built LNG facilities for new markets • Represent reliable supply when they have excess capacity LNG Peak shaving plants store natural gas (and many also liquefy gas) that can be used when gas demand is high (peak). When this occurs, LNG can be vaporized and sent to a gas grid.

9. Existing Liquefaction Plants NW Natural Portland NW Natural Newport GDF SUEZ Everett Import Terminal Merit Energy Centerpoint Burnsville MidAmerican Garner Exxon Shute Creek UGI Temple Transco Carlsdat MUD Omaha Philly Gas Works Kinetrix Indianapolis Linde Livermore Pioneer Ulysses Clean Energy Boron AGL Chattanooga Applied Topak AGL Cherokee AGL Trussville Spectrum Ehrenberg Prometheus Bowerman AGL Macon AGL Riverdale Clean Energy Pickens * Not representative of the entire market

10. Planned Liquefaction Plants Eagle LNG WA Eagle LNG ND Stabilis Bakken Shell Sarnia Noble Energy Keota Eagle LNG OH Eagle LNG CO CLNE Boron II (Expansion) Spectrum Ehrenberg Stabilis OK Applied Topak II (Expansion) Applied Midlothian • Announcements by: • Eagle (Clean Energy) • - Sempra and JEA • - Pivotal and WesPac Waller Marine Port Allen Stabilis W. TX Stabilis Haynesville Shell Geismer Floridian HEYCO Lavaca Stabilis Eagleford * Does not represent all announcements made this year

11. Historical Natural Gas & ULSD Prices Source: SNL Financial

12. ULSD & LNG Price Build Up $2.95/DGE $1.61/DGE Source: U.S. EIA, New York Harbor ULSD, November 2013 average Source: U.S. EIA; TETCO M3 November 2013 average gas price; GDF SUEZ estimates of liquefaction and distribution costs

13. Forecasted USLD & LNG Prices Source: U.S. EIA2014 Forecast; GDF SUEZ estimates of liquefaction and distribution costs

14. Market Activity by Location • Modest movement towards LNG for Jones Act, ECA-bound players TOTE Containerships Washington State Ferries Interlake Steamship Lakers Staten Island Ferry Matson Containerships Horizon Containerships TOTE Containerships Crowley ConRos Harvey Gulf OSVs American Petroleum Tankers Crowley Tankers Seacor Tankers

15. Market Activity for Bunkering • Limited opportunity to construct bunkering vessels because demand currently is small and cost to construct extremely high • Various ports considering how they will serve the growing demand for LNG • Private companies starting to make infrastructure investments • Harvey Gulf in Port Fouchon, LA Used with Permission