China’s First LNG Import Terminal

LNG 14 Doha, Qatar

24th March 2004

Chu Yanqun

LC (Buddy) Hicks

Lu Ningxian

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China’s First LNG Import Terminal

• Characteristics - Guangdong Province

• Pearl River Delta Energy Demand

• Shareholders

• Project Description

• Trunkline Route & Customers

• Commercial Arrangements

• Summary

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Guangdong Province

• Total population c. 86 million (larger than the UK)

• GDP approximately equal to:

Malaysia,

Singapore

Philippines

• GDP growth 7- 9% p.a.

• 2003 GDP 13.6%

• Insufficient domestic energy resources

Hong KongPopulation: 7m

MacauPopulation: 0.4m

West Pearl River DeltaPopulation: 8m

East Pearl River DeltaPopulation: 31m

Guangzhou

Pipeline Route $10 bln of GDP

Shenzhen

Hong Kong

Macau

FoshanDonggu

an

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Guangdong Energy Demand

Growth of Energy Mix

0 10 20 30 40 50 60 70 80 90 100

2010

2005

2000

1995

Million Tons Oil Equivalent

Coal Oil Hydro electric & nuclear LPG/ Gas

4.0%

7.0%

8.7%

9.1%

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Pearl River Delta

PRD Taiwan

Population (m) 46 23

GDP ($m) 272 286

GDP / capita ($) 5900 12500

GDP CAGR (2000-04) 9.0% 2.7%

Total primary energy consumption (mtoe) 67 60

Gas demand in 2010 (bcm) 10 14

PRD vs. Taiwan market (2001)

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Initial Gas Sales

LNG Demand at Plateau

GD Power2.05 mtpa

55%GD LDCs

1.03 mtpa

28%

HK Users0.63 mtpa

17%

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Initial Project Development

1995 CNOOC / Shenzhen studies

1999 SDPC Listing

2001 BP Selected as Foreign Partner

Establishment of Joint Executive Office

2003 Feasibility Study Approved

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JV Company

CNOOC 33%

BP 30%

Shenzhen Gas 10%

Guangdong Yudean 6%

Guangzhou Gas 6%

Shenzhen Energy 4%

Hong Kong Electric 3%

Hong Kong & China Gas 3%

Foshan Municipal Gas 2.5%

Dongguan Fuel 2.5%

Guangdong Dapeng LNG Company

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Terminal & Trunkline

• Phase 1 capacity 3.7 mtpa

• One single berth jetty

• Vaporisation Facilities

• 2 X 160,000 m3 storage tanks

• 370 Km of pipelines

• c. $900m project and working capital

Project Description

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Foshan

Dongguan

Huizhou

Hong Kong

Shenzhen

Qianwan

Guangzhou

Terminal

Offtake Station

Phase 1 Pipeline

Submarine Pipeline

Zhujiang Dongb

u

Trunkline Route

370 Kms

Send-out: Guangdong

• city gas

• power stations

Hong Kong Electric

Hong Kong & China Gas

Meishi

Nanhai

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Commercial Arrangements

LNG Sale and Purchase Agreement

Supply from Australia NWS, 25 years, take-or-pay, 3.2 mtpa at plateau, FOB

Shipping

2-3 vessels, 145,000 m3 capacity, develop national LNG shipbuilding, Sino-foreign JV

JV Company

30 years, LNG purchase, transportation, storage, re-gasification and gas marketing

Financing

70% debt, 30% equity, project finance, syndicate of Chinese banks

Gas Sales Contracts

25 years, take-or-pay, back-to-back with LNG purchase

Terminal EPC Contract

Saipem, Technigaz, Tecnimont and Sofregaz consortium selected as contractor, early works started in June 2003

Trunkline

FEED ongoing

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China’s First LNG Import Terminal

• First gas mid 2006

• Promotes clean energy and blue skies over Guangdong & Hong Kong

• Leads the development of the Chinese LNG industry

Guangdong Dapeng LNG Company Ltd.