Project presentation May 2015 Project overview Objective: Develop - PowerPoint PPT Presentation

Project presentation May 2015

Project overview • Objective: Develop a liquefied natural gas (LNG) export terminal at the Port of Saguenay, Quebec • CAD$7.5 billion facility • 11 mtpa capacity • 1.56 bcf/d of feedgas (~44 mcm/d) • 650-km new build pipeline • Differentiators : • Low plant CAPEX & OPEX • Powered by low-cost hydroelectricity • Access to low cost gas in Canada, and pipeline transportation capacity • Predictable regulatory regime • Government support in Quebec and Ottawa mtpa: million tons per annum bcf/d: billion cubic feet per day mcm/d: million cubic meters per day • Sponsors: Freestone International LLC & Breyer Capital LLC 2 Propriété de GNL Québec Inc. Tous droits réservés

First LNG cargo in 2021 2014 2015 2016 2017 2018 2019 2020 2021 Project development Construction Env. Permitting Pre-FEED/FEED LNG Marketing Gas Supply Pipeline Power Lines Financing FID Participatory process with communities, First Nations and stakeholders 3 Propriété de GNL Québec Inc. Tous droits réservés

Growing natural gaz demand fueled by power generation needs in emerging countries 4 Propriété de GNL Québec Inc. Tous droits réservés

LNG demand will increase significantly over the next decades 450 • Natural gas is an environmentally- 400 preferred source of energy 350 • LNG demand doubling over the next 20 years, largely driven by 300 Asia-Pacific 250 MMt/y • LNG buyers seek: • Competitive pricing 200 • Diversification of supply • Project risk profile 150 • Project credibility & certainty 100 of outcome • Potentially, vertical project 50 integration 0 2005 2010 2015 2020 2025 2030 5 Propriété de GNL Québec Inc. Tous droits réservés

Resilience of LNG prices to oil prices drops, and promising long term price differential • Long term Asia proxy in $14-$15/mmBtu range • Long term HH price around $5/mmBtu 6 Propriété de GNL Québec Inc. Tous droits réservés

Strong fondamental trends are supporting natural gaz demand SUSTAINED TREND TO GROWING SIGNIFICANT CHANGES NATURAL GAS NEEDS IN LNG LANDSCAPE Low cost LNG supply disappearing Emerging countries’ needs Low cost LNG plants shutting down… • China (+13% in 2013) • Brazil (+18% in 2013) • Egypt (12+ mtpa of lost LNG • Indonesia (+9% in 2013) production) • Indonesia (40% decr. in LNG export Energy policies since 99 / Arun LNG to be closed) • UAE • CO2 emission reduction in China announced in Nov 2014 …high -cost LNG supply coming online • Nuclear power decommissioning in • Australia (CAPEX over $1,500/t) Germany and shutdowns in Japan • Russia (CAPEX over $1,500/t) Existing importers growing needs • British Columbia (CAPEX over $1,300/t) • Japan (89 million tons in 2014, +1.2%) • Brazil (+28% LNG import in 2014 due 50 mtpa of LNG shortfall by 2025 to the drought) (Credit Suisse, 2014) 7 Propriété de GNL Québec Inc. Tous droits réservés

Energie Saguenay can rely on robust, competitive canadian gas supply at AECO and Dawn Canada Competitive Pricing 1,444 • AECO-C trades at Tcf an average Énergie Saguenay discount of 11% less than HH AECO-C United States Dawn MARCELLUS & UTICA Robust Supply • Tremendous natural gas resource in Canada • Highly integrated pipeline HENRY HUB (HH) network with available Gas Reserves capacity SOURCE: EIA / NEB (2013) 8 Propriété de GNL Québec Inc. Tous droits réservés

Resulting from new NA gas market dynamics, it is planned to have excess in the entire network in 2020 • Significant available pipeline capacity from Western Canada to eastern Ontario • Significant Canadian Supply from new sources (e.g. Montney, Duvernay) • Marcellus continues to offer more supply to Northeast US and Quebec/Ontario, pushing WCSB gas back to Alberta • Low cost Utica production expected to be 5 bcf/d by 2020 • Pipeline infra to be extended in NE US (Constitution, Iroquois) Historical TCPL Mainline Usage: 2003: 6.5 bcf/d 2014: 1.9 bcf/d 2020: 1.2 bcf/d (projected) 9 Propriété de GNL Québec Inc. Tous droits réservés

Energie Saguenay will require a new-build pipeline following existing right-of-way TCPL Mainline • New build: 36/42-inch pipeline from EASTERN Waddington to Saguenay (650 km) TRIANGLE • Additional infrastructure requirements in Eastern Triangle • Significant pipeline capacity from Alberta to Ontario Dawn Hub • Significant excess capacity at Dawn in Ontario 10 Propriété de GNL Québec Inc. Tous droits réservés

Unique site location enables reduced, competitive CAPEX/OPEX • Unique suitable site in Quebec for LNG export • Sheltered, year-round deepwater port • Excellent existing infrastructure • Available industrial land remote to population • Superior plant efficiency due to low ambient temperatures • Access to low-cost hydropower • Available skilled labor • Saguenay region historically supportive of industrial development 11 Propriété de GNL Québec Inc. Tous droits réservés

Energie Saguenay can rely on valuable existing infrastructure and local skilled labor • 250,000+ people (surrounding region) • Significant skilled labor (from local mining & forestry Grande Anse Marine industry/projects) Terminal (at site) • Available housing & amenities (no camps) 15 km 735 kV substation Gas Pipeline (40 km from site) right-of-way (10 km from site) Intermodal 6 km Rail Yard (at site) Major Highway to Quebec City Bagotville Airport (4-lane dual carriage way) (18 km from site) 12 Propriété de GNL Québec Inc. Tous droits réservés

Project fondamentals result in competitive economics to Asia and Europe Competitive LNG delivered price to Asia & Atlantic Basin Lower infrastructure and set-up costs (roads, logistics, temp power generation, no camp, etc) Lower permanent plant costs (jetty, lower equipment count, etc.) Low-cost, renewable hydro-power (reduces CAPEX and OPEX) Favorable low Saguenay ambient temperature (leads to higher plant efficiency and lower $/mtpa costs) Significantly lower OPEX 13 Propriété de GNL Québec Inc. Tous droits réservés

Highly differentiated: low-cost, low-complexity Low cost, low risk Low GHG Emissions Process efficiency gain Province used to LNG 2 import terminals 10-15% permitted 1 peak-shaving liquefaction plant Low cost hydropower surplus 14 Propriété de GNL Québec Inc. Tous droits réservés

Strategically positioned to supply global markets Worldwide LNG Receiving Terminals • 700 mtpa of global LNG import capacity Énergie Saguenay • Growth from 58 terminals in 2008 to 94 terminals in 2013 COMPETITIVE TO ASIA, EUROPE, MIDDLE EAST & SOUTH AMERICA Source: BG 15 Propriété de GNL Québec Inc. Tous droits réservés

NEB Export Application: http://bit.ly/1KqRLpb Propriété de GNL Québec Inc. Tous droits réservés

Contact us Phone : 418 412-4993 email : contact@energiesaguenay.com Web site: www.energiesaguenay.com