Awilco LNG

Investor Presentation • May 13, 2015

Q1 2015

Jon Skule Storheill Snorre Krogstad

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.

Agenda 13/05 2015

1. Company Overview and Highlights Q1

2. Financials Q1

3. Market update

4. Summary

Company Overview

Awilco LNG is a pure play LNG transportation provider, owning and operating LNG vessels. The Company currently owns two 2013 built 156,000 cbm TFDE membrane LNG vessels; WilForce and WilPride, and three 125,000 cbm steam Moss type LNG vessels; WilGas, WilPower and WilEnergy. Awilco LNG is listed on Oslo Axess under the ticker code ALNG.

1 st Quarter Highlights

1 st quarter 2015

• Awilco LNG reported:

−	Net freight income of	MUSD 10.3	MUSD 15.1 in Q4 2014
−	EBITDA of	MUSD 5.5	MUSD 8.5 in Q4 2014
−	Net profit/(loss) of	MUSD (4.7)	MUSD (2.6) in Q4 2014

• Vessel utilisation of 67 %, compared to 78 % in Q4 2014 (trading vessels).

Contract Overview

	2015	2016
WilGas	Available	Available
WilPride	Available	Available
WilForce	On charter	On charter
WilEnergy	Lay-up - Marketed for project work	Lay-up - Marketed for project work
WilPower	Lay-up - Marketed for project work	Lay-up - Marketed for project work

• WilGas: Open Far East
• WilPride: Open Atlantic
• WilForce: Employed until January 2017 or January 2018

WilEnergy: Lay-up

WilPower: Lay-up

Agenda 13/05 2015

1. Company Overview and Highlights Q1

2. Financials Q1

3. Market update

4. Summary

Q1 2015 Income statement

USD million	Q1'15	Q4'14	2014
Freight income	12.1	17.7	78.5
Voyage related expenses	(1.8)	(2.5)	(11.2)
Net freight income	10.3	15.1	67.2
Operating expenses	(3.6)	(5.7)	(21.1)
Administration expenses	(1.2)	(1.0)	(5.1)
EBITDA	5.5	8.5	41.0
Depreciation	(4.3)	(4.7)	(18.4)
Net finance	(5.9)	(6.3)	(25.2)
Profit/(loss) before tax	(4.7)	(2.5)	(2.6)
Tax	-	(0.1)	(0.1)
Profit/(loss)	(4.7)	(2.6)	(2.7)

Net freight income MUSD 10.3

• Reduced utilisation and lower rates on WilPride and WilGas
• 67 % utilisation trading vessels (78 % in Q4 2014)

• Reduction in voyage expenses due to lay-up of WilEnergy from mid-December 2014 and idling of WilGas and WilPride in parts of Q1

Operating expenses MUSD (3.6)

• Decrease from Q4 2014 due to lay-up of WilEnergy and provisions for crew salaries year end booked in Q4 2014

Administration expenses MUSD (1.2)

• Lower reduction in fair value of synthetic options than in Q4 2014

Depreciation MUSD (4.3)

Q1 2015 Balance sheet

USD million	31.03.15	31.12.14
Vessels	462.8	467.1	Vessels MUSD 462.8
Other non-current assets	0.1	0.3	Current assets MUSD 23.7
Total non-current assets Trade receivables	463.0 2.4	467.4 2.5	• MUSD 3.0 reduction in other short term assets relates to MUSD 3.0 prepaid BB hire 31.12.2014 • Cash MUSD 17.4 vs. MUSD 20.8 Q4
Other short term assets Cash	3.8 17.4	6.8 20.8	Non-current liabilities MUSD 282.7 • MUSD 282.5 long term portion of WilForce and WilPride
Total current assets Total assets	23.7 486.7	30.1 497.5	financial lease liabilities
			Current liabilities MUSD 16.9
Total equity	187.1	191.8	• MUSD 12.0 short term portion of WilPride and WilForce financial lease liabilities
Long-term interest bearing debt	282.5	285.6	• MUSD 2.4 deferred revenue
Other non-current liabilities	0.2	0.2
Non-current liabilities	282.7	285.7
Short-term interest bearing debt	12.0	11.7
Other current liabilities	4.9	8.2
Total current liabilities	16.9	19.9
Total equity and liabilities	486.7	497.5

Q1 2015 Cash flow

USD million	Q1'15	Q4'14	2014
Cash Flows from Operating Activities:
Profit/(loss) before taxes	(4.7)	(2.5)	(2.6)
Income taxes paid	-	0.1	-
Interest and borrowing costs expensed	6.0	6.2	25.1
Depreciation and amortisation	4.3	4.7	18.4
Trade receivables, inventory and other short term assets	-	1.5	7.0
Accounts payable, accrued exp. and deferred revenue	(3.4)	(1.6)	(2.2)
Net cash provided by / (used in) operating activities	2.3	8.4	45.7
Cash Flows from Investing Activities:
Investment in vessels	-	(0.1)	(6.7)
Investment in vessels under construction	-	-	(0.5)
Investment in other fixed assets	-	-	-
Proceeds from sale of other fixed assets	0.1	-	-
Net cash provided by / (used in) investing activities	0.1	(0.1)	(7.2)
Cash Flows from Financing Activities:
Proceeds from borrowings	-	-	-
Repayment of borrowings	(1.8)	(2.8)	(10.8)
Interest and borrowing costs paid	(4.0)	(6.2)	(25.0)
Net cash provided by / (used in) financing activities	(5.8)	(9.0)	(35.9)
Net changes in cash and cash equivalents	(3.4)	(0.7)	2.6
Cash and cash equivalents at start of period	20.8	21.5	18.2
Cash and cash equivalents at end of period	17.4	20.8	20.8

Operating activities MUSD 2.3

Investing activities MUSD 0.1

Financing activities MUSD 5.8

• Interest payment and repayment on WilPride and WilForce financial lease liabilities

Cash at the end of the quarter MUSD 17.4

Agenda 13/05 2015

1. Company Overview and Highlights Q1

2. Financials Q1

3. Market update

4. Summary

Rate development

• Due to low activity and a number of available ships the spot market has experienced a continued weakening in 2015 to the lowest levels in 5 years
• Activity has picked up lately, but with a number of available vessels rates have not improved much yet

Source: Fearnley LNG

Gas price development

Natural gas price spread between Asia and the Atlantic basin

• Lower oil price is negative for the short-term inter-basin trade
• Inter-basin spread at 3-year low
• Since November the cost of shipping a cargo from the Atlantic basin to Asia has been uneconomical
• Extra shipping cost WAF/Japan vs WAF/UK currently at \$0.6/mmbtu

LNG import by region

LNG import per month 2011 – 2015 in mill mt

Europe 10.3 17.2 % Asia 44.1 -10.4 % Americas 6.3 46.7 % Total 60.4 -2.6%

Source: RS Platou

LNG import – China

0 1 000 2 000 3 000 4 000 5 000 6 000 Q1 Q2 Q3 Q4 MT LNG IMPORT TO CHINA 2012 2013 2014 2015

• Low LNG import to China resulting from:
• Higher pipeline imports
• Mild winter
• Increased domestic production
• Long term China is still very promising
• China will expand ban on coal burning to include suburban areas as well as city centers
• China will promote power supply by natural gas and renewables and offer subsidies for clean fuels
• In earlier action plans China aims to cut coal consumption by over 80 million tonnes by 2017 and 160 million tonnes by 2020 – replaced by nuclear and gas

LNG import and production

PRODUCTION CAPACITY AND IMPORT

• LNG imports in 2014 was back to same level as in 2011
• Production capacity increased by 20 MTPA during same period
• Production set to increase by more than 20 MTPA in both 2015 and 2016

Source: GIIGNL

LNG production

• A total of abt 118 MTPA of new LNG capacity (including re-start of Angola production) is under construction in the period 2015 -2018
• Australia representing about 60 MTPA and U.S 40 MTPA in total
• FIDs may see delay due to decreasing oil and gas prices

Source: RS Platou

LNG fleet orderbook

Newbuilding deliveries by quarter

• Six vessels delivered Q1 2015
• 10 newbuilding ordered (reported) in Q1 15
• 31 vessels scheduled for delivery during 2015
• 141 vessels on order excluding FSRU and FLNG

Source: Fearnley LNG

Agenda 13/05 2015

1. Company Overview and Highlights Q1

2. Financials Q1

3. Market update

4. Summary

Summary

• Very weak rates and low activity till now, but finally picking up
• 24 MTPA of new production capacity scheduled to start in 2015 in addition to restart of Angola
• 31 newbuildings scheduled for delivery in 2015 of which only 6 are open
• Expect low rates until meaningful new production starts
• Long term demand for LNG remain strong supply expected to increase by 50 % from 2015 2018
• Declining gas price makes LNG more competitive as energy source, but may slow FID on some smaller projects

Awilco LNG – summary

• Market is dismal a lot of new LNG production expected next 6-7 months. There is a light in the tunnel!
• Short-midterm contract WilPride with improving fundamentals …

Infrastructure projects

• ALNG focus is FSU, but some interest in FSRU conversions remain
• Moss tanks "only" option . 2nd generation vessels far better BOG than 1st generation
• These projects are large and slow moving

Unless market picks up ALNG will eventually need cash

• We have three unlevered 2 nd generation ships that can be sold or mortgaged

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