Awilco LNG

Investor Presentation • May 5, 2017

Q1 2017

Jon Skule Storheill Snorre Krogstad

05/05/17

Disclaimer

This presentation may include certain forward-looking statements, forecasts, estimates, predictions, influences and projections regarding the intent, opinion, belief, various assumptions or current expectations of Awilco LNG (the "Company") and it's management with respect to, among other things, (i) goals and strategies, (ii) evaluation of the Company's markets, competition and competitive position, and (iii) anticipated future performance and trends which may be expressed or implied by financial or other information or statements contained herein.

All statements, other than statements of historical facts, that address activities and events that will, should, could or may occur in the future are forward-looking statements. Words such as "may," "could," "should," "would," "expect," "plan," "anticipate," "intend," "forecast," "believe," "estimate," "predict," "propose," "potential," "continue" or the negative of these terms and similar expressions are intended to identify such forward-looking statements.

These forward-looking statements, forecasts, estimates, predictions, influences and projections are not guarantees of future performance and are subject to known and unknown risks, uncertainties and other factors because they relate to events and depend on circumstances that will occur in the future, some of which are beyond our control and difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements, and no representation is made as to the accuracy of these. Among the important factors that could cause actual results to differ materially from those in the forwardlooking statements, forecasts, estimates, predictions, influences and projections are: changes in LNG transportation market trends; changes in the supply and demand for LNG; changes in trading patterns; changes in applicable maintenance and regulatory standards; changes in applicable regulations and laws; technological developments affecting gas and LNG demand; political events affecting production and consumption of LNG; changes in the financial stability of clients of the Company; the Company's ability to secure employment for available vessels and newbuildings on order; increases in the Company's cost base; failure by yards to comply with delivery schedules; changes to vessels' useful lives and residual values; the Company's ability to obtain financing of the newbuildings and lastly unpredictable or unknown factors with material adverse effects on forward-looking statements.

Neither the receipt of this presentation by any person, nor any information contained herein, constitutes, or shall be relied upon as constituting, any advice relating to the future performance of the Company. Each person should make their own independent assessment of the merits of the Company and its business and should consult their own professional advisors. The information and opinions contained in this presentation relate only as of the date of this presentation, and are subject to change without notice. Neither the Board of Directors of the Company or the Company and it's management make any representation or warranty, express or implied, as to the accuracy or completeness of this presentation or of the information contained herein and none of such parties shall have any liability for the information contained in, or any omissions from, this presentation, nor for any of the written, electronic or oral communications transmitted to the recipient in the course of the recipient's own investigation and evaluation of the Company or its business. Unless legally required, the Company assumes no responsibility or obligation to update publicly or review any of the forwardlooking statements contained herein, whether as a result of new information, future events or otherwise.

Company Overview

Awilco LNG is a pure play LNG transportation provider, owning and operating LNG vessels. The Company owns two 2013 built 156,000 cbm TFDE membrane LNG vessels, WilForce and WilPride. Awilco LNG is listed on Oslo Axess under the ticker code ALNG.

Agenda 05/05 2017

1. Financials Q1

2. Market update

3. Summary

Q1 2017 Income statement

USD million	Q1'17	Q4'16	2016
Freight income	2.5	9.1	34.8
Voyage related expenses	(1.6)	(0.3)	(2.8)
Net freight income	0.8	8.8	32.0
Operating expenses	(1.9)	(1.8)	(8.7)
Administration expenses	(0.9)	(0.9)	(3.5)
EBITDA	(2.0)	6.1	19.8
Depreciation	(2.9)	(2.9)	(12.9)
Impairment	-	-	(6.6)
Net finance	(5.5)	(5.7)	(23.2)
Profit/(loss) before tax	(10.4)	(2.5)	(22.8)
Tax	-	-	-
Profit/(loss)	(10.4)	(2.5)	(22.8)

Q1 2017 Balance sheet

USD million	31.03.17	31.12.16
Vessels	369.2	371.8
Other non-current assets	0.1	0.1
Total non-current assets	369.3	371.9
Trade receivables	-	0.6
Other short term assets	5.2	5.8
Cash	19.4	30.0
Total current assets	24.6	36.4
Total assets	393.9	408.4
Total equity	122.4	132.8
Long-term interest bearing debt	255.4	259.0
Other non-current liabilities	0.3	0.3
Non-current liabilities	255.7	259.3
Short-term interest bearing debt	14.1	13.8
Other current liabilities	1.7	2.5
Total current liabilities	15.8	16.3
Total equity and liabilities	393.9	408.4

Q1 2017 Cash flow

USD million	Q1'17	Q4'16	2016
Cash Flows from Operating Activities:
Profit/(loss) before taxes	(10.4)	(2.5)	(22.8)
Income taxes paid	-	-	-
Interest and borrowing costs expensed	5.5	5.7	23.2
Depreciation, amortisation and impairment	2.9	2.9	19.5
Trade receivables, inventory and other short term assets	1.2	0.3	1.3
Accounts payable, accrued exp. and deferred revenue	(0.9)	(1.7)	(1.5)
Net cash provided by / (used in) operating activities	(1.6)	4.7	19.6
Cash Flows from Investing Activities:
Investment in vessels / sale of vessels	(0.3)	(0.1)	32.1
Proceeds from sale of other fixed assets	-	-	-
Net cash provided by / (used in) investing activities	(0.3)	(0.1)	32.1
Cash Flows from Financing Activities:
Repayment of borrowings	(3.3)	(3.3)	(13.9)
Interest and borrowing costs paid	(5.5)	(5.7)	(25.1)
Net cash provided by / (used in) financing activities	(8.7)	(9.0)	(39.0)
Net changes in cash and cash equivalents	(10.7)	(4.5)	12.7
Cash and cash equivalents at start of period	30.0	34.5	17.3
Cash and cash equivalents at end of period	19.4	30.0	30.0

Agenda 05/05 2017

1. Financials Q1

2. Market update

3. Summary

LNG rates

• After a promising end 2016, activity and rates weakened considerably during the winter months
• Improvement in both activity and rates in April and May, but still far below start of the year

Monthly global LNG trade

• Global LNG trade up by 12 % in Q1 2017 compared to same period last year

• New LNG production capacity added in 2016 was 41 MT full production expected to be reached during 2017
• Seasonality is still valid in LNG trading, but new production capacity coming on line is lifting volumes

Source: Clarksons Platou

Gas price

• Both Far East and Europe gas prices declined during the quarter
• Europe Far East arbitrage closed leading to fewer re-loads
• Cheap US LNG prices cargoes exported to a various destinations, including Far East
• 2016 avr 1.7 ships/mtpa vs historical avr 1.3 ships/mtpa

Source: Clarksons Platou

LNG trade

LNG exports yoy 2017 LNG imports yoy 2017

• Australian and US ramp up is materialising

• LNG exports increased by 12 % YoY

• China and India continue increasing import trend

• The Japanese and Korean declining trend has finally turned
• Europe is increasing, but has massive untapped import capacity

Source: Clarksons Platou

LNG production

• Ramp-up takes about 6 months full effect of 2016 capacity increase through 2017
• Gorgon T3 and Sabine Pass T3 on time completed by the end of Q1
• Australian plants showing production issues resulting in restrictions on export volumes , may lead to sourcing from US

Source: Clarksons Platou, Poten & Partners

LNG fleet and orderbook

• Total orderbook coming down now 104 vessels of which max 10 are available
• 9 vessels delivered in Q1 further 35 scheduled for delivery in 2017, although delays may be expected
• Three newbuildings ordered Q1 2017

Source: Fearnley LNG

Agenda 05/05 2017

1. Financials Q1

2. Market update

3. Summary

Summary

• Market still volatile and seasonal
• ─ Q1 very weak both in terms of rates and activity
• ─ Improvement in Q2 but still below Q4 2016 level
• Mid- and long-term demand for LNG transportation remains strong
• ─ We are at the start of the biggest increase of LNG volumes in history
• ─ Full effect of 2016 new capacity will be seen during 2017
• ─ Surplus of available ships led to low rates in Q1 but ships are being absorbed and activity picking up
• ─ Limited newbuilding orders, charterers and finance available
• ─ 17 % of existing fleet is built prior to 2000 and is smaller and inefficient
• Awilco LNG exposed to seasonal and volatile LNG spot market
• In constructive discussions with Teekay LNG Partners

A Pure Play LNG Transportation Provider

Jon Skule Storheill CEO Mobile: +47 -9134 4356 E -mail: jss@awilcolng.no

Snorre Krogstad CFO Mobile: +47 -9085 8393 E -mail: ssk@awilcolng.no