LNG as Fuel Operations

Lessons Learned Questions & Answers

Chad Verret – Executive Vice President Harvey Gulf International Marine

Agenda • Introduction • Company Overview • What to look for & look out for from an owner’s perspective?

o Planning o Training o Safety

• Questions & Answers

Company Overview • Operates the youngest and most technically advanced and safest fleet of 57 vessels in

the GOM • Vessels include:

o Offshore Supply Vessels (OSV) o Multi-Purpose Support Vessels (MPSV) o Fast Supply Vessel (FSV)

• Under construction vessels: o 3 – 310’ LNG Dual Fuel OSV’s o 2 – 340’ Multi Purpose OSV’s

• Customer base consists of major drilling contractors and E&P companies who primarily operate in the deep water and ultra-deep water industry (1,000 – 12,000 feet)

• 1st U.S. flagged vessel that can run entirely on natural gas • 1st U.S. LNG bunkering facility

Planning “By failing to prepare, you are preparing to fail.” – Benjamin Franklin

• Making the first move? o Deciding to either build new vessels with LNG fueled engines, converting existing

vessels to LNG fueled engines, or constructing and operating a LNG bunkering facility?

• #1 Rule – Identify and incorporate all stakeholders from start to finish o United States Coast Guard o American Bureau of Shipping o Martin Energy o Shell o Greater Lafourche Port Commission – Port Authority and Harbor Police o State of Louisiana Fire Marshal o Lafourche Parish Fire District No. 3 o Louisiana State Police (HAZMAT) o Lafourche Parish Office of Emergency Planning o Lafourche Parish Sheriff Office o Lafourche Parish Emergency Medical Service o Louisiana Governor’s Office of Homeland Security & Emergency

Preparedness

Planning • Lessons Learned from Incorporating all stakeholders in the planning process:

o Helps debunk the myths of LNG o Increases participation and problem-solving among the group o Increases the message of benefits of LNG usage o Develops an understanding of the product o Creates positive effective relationships o Increases capabilities and competencies required for effective

emergency management and response

Planning • #2 Rule – Understand roles and responsibilities of regulatory organizations and

all applicable regulations o Vessel

• United States Coast Guard • American Bureau of Shipping • International Maritime Organization

o Facility • United States Coast Guard • National Fire Protection Agency • Occupational Health and Safety Administration

Planning • Lessons Learned from Regulatory Parties and Regulations in the planning process:

o Always plan for the future or anticipated changes • Be informed of Policy Letters • HAZID’s • Communicate with regulatory parties

o Engage in best practice discussions o Be flexible in order to complete the project – “Don’t paint yourself in the corner!” o Develop a continuous improve plan o Understand the role and responsibilities of the Regulatory Parties o Provide solutions not problems

Training “No one learns as much about a subject as one who is forced to teach it.” – Peter F.

Drucker • How to become the expert?

o Ask questions…..Who? What? When? Where? How? o Visit and learn from others who succeeded o Become involved / Join organizations

• Society for Gas as a Marine Fuel (SGMF) o Develop a Team of project leaders to develop and guide the steps throughout the

process • Project Manager • Safety Manager • Operations Manager • Personal Manager

o Establish training program as per current and future regulations • Maritime Simulation Institute • Gas Technology Institute • Massachusetts Firefighting Academy • Texas A&M Firefighting Academy

Training

E

T S

O T

U E S S

o Understand the properties of the product o Know how it reacts in the environment and inside the tank o Learn how to respond if it reacts

Fixed 350lbs Purple K Extinguisher on vessels

Training • Lessons Learned

o Purple K is the best product to extinguish a LNG fire o Installed on vessel and facility

o PPE Policy installed: Full Face Shield, Cryogenic Aprons, Cryogenic Gloves, Solid Leather Steel-Toe Boots, Fire Resistant Clothing, Hard Hat.

o Never trap the liquid between two points o Understand the expansion rate of the liquid

o Establishing hazard zones on vessel and facility and putting barriers in place to ensure no ignition sources or harm can occur in these areas o HGIM LNG Bunkering Facility is classified as a restricted area completely

enclosed within a regulated secured facility o This allows us to isolate the LNG operations from the rest of the facility

o Vessels have designated painted hazardous zones to identify areas to avoid an open flame.

o Developed in-house training / orientation on vessels and facility to fully educate individuals on the specific systems

Training • Lessons Learned

o In-house training topics covered o Fire Fighting Techniques o Bunkering Procedures o Gas Detection and LNG related Ventilation Systems o Proper PPE usage for LNG handling o Cell phone and Smoking Policies o First Aid for LNG o Emergency Response Plan o Location of Hazardous Zones and Policies o Operations Manual

1st LNG Bunkering from HGIM LNG Bunkering Facility –

January 29, 2016

Fire Water Pumps on Harvey Energy

Safety “Safety Begins with Me….No one Gets Hurt!” – Shane Guidry CEO Harvey Gulf International

Marine • What does Safety mean to the company and LNG operations?

o It starts from the top! • The safety of personnel, environment, and assets is top priority at HGIM

o TRIR of ZERO for over 1,100 days o Visible Management on vessels and facility

• Senior Management vessel visits to conduct Learning From Incidents Safety Meetings

• Direct involvement with shore-side management and offshore vessels • HGIM Dock allow close proximity to operations to ensure vessels and facility to

operating safely • Safety Manager ride vessels to assess the safety of the operations of the crew

o HGIM Safety Manager supervises every LNG bunkering to vessels from the facility o Developed and implemented safety barriers

• Job Safety Environmental Analysis (JSEA) for every job task • LNG Bunkering Checklist • Declaration of Inspection • Declaration of Security • Fuel Commitment Letter – “Not One Drop Spilled” • Continuous Improvement Manual • Safety Management System