34
1 | 2017 1 | 2017 2017 | 1 Company Presentation November 2017
1 | 2017 1 | 2017 2017 | 1
Company Presentation November 2017
2 | 2017 2 | 2017 2017 | 2
• THIS PRESENTATION (THE “PRESENTATION”) HAS BEEN PRODUCED BY FLEX LNG LTD. ("FLEX LNG" OR "THE COMPANY”), SOLELY FOR PRESENTATION
PURPOSES AND DOES NOT PURPORTE TO GIVE A COMPLETE DESCRIPTION OF THE COMPANY, ITS BUSINESS OR ANY OTHER MATTER DESCRIBED
HEREIN.
• THE PRESENTATION DOES NOT CONSTITUTE AN OFFER, INVITATION OR SOLICITATION OF AN OFFER TO BUY, SUBSCRIBE OR SELL ANY SECURTIEIS. THIS
PRESENTATION IS STRICTLY CONFIDENTIAL AND MAY NOT BE REPRODUCED OR REDISTRIBUTED, IN WHOLE OR IN PART, TO ANY OTHER PERSON.
• NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY OR COMPLETENESS OF ANY INFORMATION INCLUDED HEREIN IS
GIVEN BY THE COMPANY, AND THAT NOTHING CONTAINED IN THIS PRESENTATION IS OR CAN BE RELIED UPON AS A PROMISE OR REPRESENTATION BY
THE COMPANY, WHO DISCLAIM ALL AND ANY LIABILITY, WHETHER ARISING IN TORT OR CONTRACT OR OTHERWISE.
• THE PRESENTATION SPEAKS AS OF THE DATE SET OUT ON ITS FRONT PAGE. THE COMPANY DOES NOT INTEND TO, OR WILL ASSUME ANY OBLIGATION
TO, UPDATE THE PRESENTATION OR ANY OF THE INFORMATION INCLUDED HEREIN.
• THE CONTENTS OF THE PRESENTATION ARE NOT TO BE CONSTRUED AS FINANCIAL, LEGAL, BUSINESS, INVESTMENT, TAX OR OTHER PROFESSIONAL
ADVICE. EACH RECIPIENT SHOULD CONSULT WITH ITS OWN PROFESSIONAL ADVISORS FOR ANY SUCH MATTER AND ADVICE.
• AN INVESTMENT IN THE COMPANY INVOLVES RISK, AND SEVERAL FACTORS COULD CAUSE THE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS
OF THE COMPANY TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS THAT MAY BE EXPRESSED OR
IMPLIED BY STATEMENTS AND INFORMATION IN THIS PRESENTATION.
• THE PRESENTATION CONTAINS CERTAIN FORWARD-LOOKING STATEMENTS RELATING TO THE BUSINESS, FINANCIAL PERFORMANCE AND RESULTS OF
THE COMPANY AND/OR THE INDUSTRY IN WHICH IT OPERATES, SOMETIMES IDENTIFIED BY THE WORDS "BELIEVES”, "EXPECTS”, “INTENDS”, “PLANS”,
“ESTIMATES” AND SIMILAR EXPRESSIONS. THE FORWARD-LOOKING STATEMENTS CONTAINED IN THIS PRESENTATION, INCLUDING ASSUMPTIONS,
OPINIONS AND VIEWS OF THE COMPANY OR CITED FROM THIRD PARTY SOURCES, ARE SOLELY OPINIONS AND FORECASTS WHICH ARE SUBJECT TO
RISKS, UNCERTAINTIES AND OTHER FACTORS THAT MAY CAUSE ACTUAL EVENTS TO DIFFER MATERIALLY FROM ANY ANTICIPATED DEVELOPMENT. THE
COMPANY DOES NOT PROVIDE ANY ASSURANCE THAT THE ASSUMPTIONS UNDERLYING SUCH FORWARD-LOOKING STATEMENTS ARE FREE FROM
ERRORS NOR DOES THE COMPANY ACCEPT ANY RESPONSIBILITY FOR THE FUTURE ACCURACY OF THE OPINIONS EXPRESSED IN THE PRESENTATION
OR THE ACTUAL OCCURRENCE OF THE FORECASTED DEVELOPMENTS. NO OBLIGATION IS ASSUMED TO UPDATE ANY FORWARD-LOOKING STATEMENTS
OR TO CONFORM THESE FORWARD-LOOKING STATEMENTS TO ACTUAL RESULTS.
• THIS PRESENTATION IS SUBJECT TO NORWEGIAN LAW, AND ANY DISPUTE ARISING IN RESPECT OF THIS PRESENTATION IS SUBJECT TO THE EXCLUSIVE
JURISDICTION OF THE NORWEGIAN COURTS.
Disclaimer
3 | 2017 3 | 2017 2017 | 3
05
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04
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02
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01
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01
04
About FLEX LNG
LNG Shipping Market Outlook
MEGI Propulsion
FSRU Market Development
Summary
Table of contents
4 | 2017 4 | 2017 2017 | 4 4 | 2017
01
4 | 2017
01
4 | 2017
01 About FLEX LNG
5 | 2017 5 | 2017 2017 | 5
FLEX LNG at a Glance
FLEX LNG: LNG Shipping and Regasification
FLEX ENTERPRISE: MEGI newbuilding under construction at DSME, South Korea
FLEX LNG aims to become a leading supplier of LNG
Carriers and Floating Storage & Regasification Units (“FSRUs”)
• FLEX LNG is focused on providing safe, reliable, and cost
effective solutions in the LNG shipping industry
• The Company has built a strong market presence and
successfully raised over US$ 200m in 2017 and transferred its
listing to the main Oslo Stock Exchange
FLEX’s fleet will provide Charterers with highly efficient tonnage to
lower fuel consumption and reduce boil off rate
• FLEX LNG has six 174,000 cbm MEGI* newbuildings under
construction at DSME and SHI for delivery in 2018 and 2019
• MEGI propulsion has ~30% lower fuel consumption than Tri-
Fuel Diesel Electric (TFDE) vessels
FLEX LNG is actively pursuing opportunities in the FSRU market
• FLEX LNG has a highly experienced commercial and technical
team to succeed in the FSRU market
*MEGI = M-type, Electronically Controlled, Gas Injection
6 | 2017 6 | 2017 2017 | 6
2
1
1
1
6
0
1
2
3
4
5
6
Q1 2018 Q2 2018 Q3 2018 Q2 2019 Q3 2019
# Vessels
6 173,400 173,400
174,000 174,000
2 173,400 170,000
• 4 chartered-in TFDEs for 6 months period from Mar-17
• 2 vsls redelivered Sep; 2 vessels extended until Mar-18
• Building market presence, operational experience,
and relationships with key LNG charterers
• 6 LNG MEGI vessels on order
• Under contruction at DSME and SHI in Korea
• Delivering Q1-Q3 2018, Q2-Q3 2019
173,400 173,400
Owned Fleet Deliveries
Owned Fleet Chartered-in Vessels
FLEX LNGC Fleet Development
7 | 2017 7 | 2017 2017 | 7
FLEX LNG Fleet Breakdown – Owned and Chartered-In
Status Vessel Name Builder Prop. Built Capacity Head Owner Employment
1. Owned TBN FLEX ENDEAVOUR DSME MEGI 2018 173,400 m3 FLEX LNG Available Jan 2018
2. Owned TBN FLEX ENTERPRISE DSME MEGI 2018 173,400 m3 FLEX LNG Available Jan 2018
3. Owned TBN FLEX RANGER SHI MEGI 2018 174,000 m3 FLEX LNG Available May 2018
4. Owned TBN FLEX RAINBOW SHI MEGI 2018 174,000 m3 FLEX LNG Available Jul 2018
5. Owned TBN FLEX CONSTELLATION DSME MEGI 2019 173,400 m3 FLEX LNG Available Jun 2019
6. Owned TBN FLEX COURAGEGOUS DSME MEGI 2019 173,400 m3 FLEX LNG Available Aug 2019
7. Chartered-in WOODSIDE REES WITHERS DSME TFDE 2016 174,000 m3 Dynagas Chartered-out
8. Chartered-in PSKOV STX TFDE 2014 170,000 m3 Sovcomflot Chartered-out
8 | 2017 8 | 2017 2017 | 8
FLEX LNG FSRU Strategy Growth of FSRU Regas Capacity by Country
FLEX LNG is actively developing several opportunities to
leverage its experience with the development and implementation
of FSRU infrastructure
• Opportunities may include FSRU newbuildings for long-term
charters and/or conversions of existing vessels
FLEX LNG has a highly experienced commercial and technical
team to succeed in the FSRU market
• Jonathan Cook (founding partner at Excelerate Energy
and ex-Chief Marketing Officer for Cardiff LNG) was
appointed CEO in March 2017
• Thomas Thorkildsen (formerly head of business development
at Höegh LNG, responsible for FSRU opportunities) joined in
February 2017 to lead business development efforts
• Øystein Kalleklev (formerly CFO at Knutsen NYK Offshore
Tankers involved in e.g. financing of FPSOs) joined FLEX in
September 2017
The FLEX LNG team can draw on extensive technical FSRU
knowledge within the group
• Management has been involved in 13 of the existing 21 FSRU
projects worldwide (19 FSRUs including decommissioned
projects)
FLEX LNG’s FSRU Ambitions
Escobar FSRU, Argentina
0
20
40
60
80
100
2017E 2018E 2019E
mtpa India Chile Bangladesh Puerto Rico Uruguay
Brazil Russia Pakistan Turkey Ghana
Source: Reuters
9 | 2017 9 | 2017 2017 | 9
Functional Organizational Chart of FLEX LNG
A highly experienced team is in charge of LNG shipping
LNGC
Owned Fleet
(FLEX LNG)
Technical Mgt
(Frontline Mgt)
Newbuild Supervision
(Seatankers)
Crewing, Ship Mgt
(Bernhard Schulte)
Newbuild Design
(Ship Construction Strategies)
Chartering
(FLEX LNG)
Commercial Operations
(V.Ships)
Chartered Fleet
(FLEX LNG)
Chartering
(FLEX LNG)
Commercial Operations
(V.Ships)
Finance & Admin
(FLEX LNG)
Finance
(FLEX LNG)
Accounting
(Frontline Mgt)
Insurance
(Frontline Mgt)
Providing technical management
and support services
• 160 vessels including LNG,
tankers, dry bulk, container,
offshore supply
• Vessel construction, project
management, technical
management, insurance, etc.
• HSE and Incident Response
Providing newbuild construction
supervision services
• 47 vessels under construction
including LNG, tankers, dry
bulk, containers, offshore
Providing crewing and ship
management services
• 600 ships under crewing
and/or technical management
• Dedicated LNG crew for FLEX
LNG vessels
Frontline
Management Ltd
Seatankers
Management Ltd
Bernhard Schulte
Shipmanagement
FLEX LNG Strategic Partners
FLEX LNG
Shared Services
Third Party
10 | 2017 10 | 2017 2017 | 10
CEO
Jonathan Cook
Business Development
Thomas Thorkildsen
SVP B.D.
VP B.D.
Kent Paulli
Manager B.D.
FSRU Design
Alan Nierenberg
Commercial
Jonathan Cook
Comm. Analyst
Sara Stahl
Comm. Operator
Andrew Niven
Comm. Operator
Marijan Glavan
Operations
Fleet Manager
Mike O’Rourke
Marine Super.
Jason Ratcliffe
Fleet Personnel
Agnieszka Murawka
Technical
Olav Eikrem
Technical Director
Head of Newbuilding
Björn Westerberg
Project Manager
JS Narayanan
DSME
Site Team (19)
SHI
Site Team (14)
Fleet Manager
Ola-Petter Dahlen
Sr. Tech Super.
Calum Hickman
Technical Officer
Frank Shaw
Technical Officer
Adrienne Snowdon
Technical Officer
Vicky Gatherar
Electrical Super.
Finance/Admin/IR
Oystein Kalleklev
CFO
SVP Finance
James Clarke
Accounting/Tax
Tom Pryor (4)
Corp. Secretary
Georgina Sousa (2)
Insurance
Chris Walker
FLEX LNG - Organizational Chart
11 | 2017 11 | 2017 2017 | 11
Jonathan Cook (54) – Chief Executive Officer
• Previously Chief Marketing Officer for Cardiff LNG, where he managed the LNG commercial activities
• Mr. Cook was founding partner of Excelerate Energy from 2003 onwards, Mr. Cook was part of the leadership team
that pioneered new frontiers in LNG shipping and transportation, by developing and marketing floating storage and
regasification technologies to address the logistical challenges of importing and exporting LNG worldwide
• Mr. Cook has 30 years in the maritime and energy sectors with the last 16 years in the LNG sector
Øystein Kalleklev (38) - Chief Financial Officer
• Mr. Kalleklev joined FLEX LNG in October 2017, after serving as CFO of Knutsen NYK Offshore Tankers since
2013 and Chairman of the General Partner of the MLP KNOT Offshore Partners from 2015-2017
• Previous roles include CFO of industrial investment company Umoe Group, Managing Director of Umoe Invest,
Partner of investment bank Clarksons Platou and Business Consultant at Accenture
• Mr. Kalleklev holds a MSc in Business and Administration from Norwegian School of Economics and a Bachelor in
Business and Finance from Heriot-Watt University
Thomas Thorkildsen (45) - SVP Business Development
• Previously Mr. Thorkildsen was the former head of business development at Höegh LNG. Furthermore, he was
responsible for various commercial roles such as commercial management, chartering etc.
• Mr. Thorkildsen has 20 years experience in the maritime industry with the last 14 years in LNG business
development
• Prior to joining Höegh LNG he was employed by the Norwegian Ro-Ro specialist Wilh. Wilhelmsen Group. Mr.
Thorkildsen holds an MSc from Cass Business School, London
Executive Management Team
12 | 2017 12 | 2017 2017 | 12
David McManus (64) – Chairman
• Mr. McManus has served on the Board since August 2011, and was elected as chairperson in September 2011
• Previously served as Executive Vice President for Pioneer Natural Resources. He is currently serving as non-executive director
for a number of listed companies
• Mr. McManus was previously Chairman of Cape plc an energy service company, which has been involved as a contractor in
more than 50% of the world's LNG facilities, including Sakhalin, RasGas, Damietta, Pluto and Arzew
Marius Hermansen (38) – Director
• Mr. Hermansen joined the Board in December 2015. Marius works for Frontline Management and is involved in S&P activities for
Frontline and all related companies
• Previously Mr. Hermansen worked for over 10 years at Fearnleys
• Mr. Hermansen was educated at the Norwegian School of Economics (NHH) in Bergen
Ola Lorentzon (68) – Director
• Mr. Lorentzon has been a Director since June 2017
• Ola served as Principal Executive Officer of Golden Ocean Group from 2010 to 2015 and held the role as Chief Executive Officer
of Frontline Management from April 2000 to 2003
• Mr. Lorentzon is also a Director and Chairman of Golden Ocean Group, Director of Erik Thun AB and Dir. of Laurin Shipping AB
Georgina Souza (67) – Director
• Mrs. Sousa has been a Director of the Company since June 2017
• Mrs. Sousa has served as Secretary of Golden Ocean Group Limited since March 2007. Prior to joining Golden Ocean, Mrs.
Sousa held the role as Vice President Corporate Services of Consolidated Services, a Bermuda management company having
joined that firm in 1993. From 1982 to 1993 she served as Senior Company Secretary at the law firm Cox & Wilkinson
Nikolai Grigoriev (43) – Director
• Mr. Grigoriev joined the Board in September 2017
• From 2008 to 2016 Nikolai served as Managing Director of Shipping and Logistics at Gazprom Marketing & Trading. Prior to
Gazprom, Mr. Grigoriev worked for BG Group in senior LNG shipping, commercial and corporate finance roles. Nikolai holds a
B.Sc. in Navigation from Admiral Makarov State Maritime Academy in St. Petersburg, Russia and an MBA from INSEAD
Board of Directors
13 | 2017 13 | 2017 2017 | 13 13 | 2017
02
13 | 2017
02
13 | 2017
02 LNG Market Outlook
14 | 2017 14 | 2017 2017 | 14
Key Trends in the LNG Shipping Market
Natural Gas becoming
fuel of choice
Strong growth
expected in the LNG
market
• Over the next 5 years LNG annual supply is projected to rise by atleast 130 mt to ~418 mt
in 2021, coming from both new liquefaction plants and existing projects ramping up capacity
• IEA predicts global energy demand will increase by 30% between by 2040. Natural gas
represents 25% of the world’s energy mix
• LNG grows seven times faster than pipeline gas trade and is expected to account for 50%
of globally traded gas in 2035 (up from 32% today)
• Both total consumption and the number of countries importing LNG are expected to
increase significantly over the next 10-15 years from 39 to 90 countries
LNGC fleet
development
• The LNG shipping market is expected to tighten significantly with an estimated decrease in
available tonnage of 57 vessel equivalents in the period until 2020 on conservative
assumptions
• 90% of the LNGC newbuildings built by 2020 are committed on long term charters
Activity in LNG
chartering market
continues to grow
• While activity in the LNG chartering market continues to grow, the average charter durations
fall
• Short-term fixtures (>6 months) picked up in 2016 as charterers began covering term
requirements from new project start ups
• Higher spot rates for MEGI propulsion vessels (estimated to be approx. USD 16-18k per
day premium for MEGI vessels)
1
2
3
15 | 2017 15 | 2017 2017 | 15
242 240 238 240 246 268
297 337
373 404 418
-
100
200
300
400
500
600
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Mt LNG Middle East Atlantic Asia-Pacific
LNG Trade to Increase by Over 50% by 2021
Supply by Region, 2011-2021
Sources: Affinity, IEA
Demand by Region, 2011-2021
11%
56%
Forecast Actual
242 239 238 239 247
267 297
337 373
404 418
0
100
200
300
400
500
600
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Mt LNG South America North America Europe Middle East Africa Asia-Pacific
56%
11%
Forecast Actual
16 | 2017 16 | 2017 2017 | 16
Total export
capacity
additions of
115+ mtpa by
2020
14
6.5
38 10
17
6 6
6
5
2
4
2
1
0
20
40
60
80
100
120
140
-
10
20
30
40
50
2017 2018 2019 2020
mtpa mtpa
United States Australia Russia Malaysia Indonesia Equatorial Guinea Camaroon Cumlative Capacity
Source: Reuters
Supply Growth Driven by New Exports from U.S. and Australia
New LNG Export Capacity Under Construction
17 | 2017 17 | 2017 2017 | 17
Source: Fearnley LNG
FSRU Projects: Existing, Planned and Proposed
5%
3%
7%
13%
16%
22%
0%
5%
10%
15%
20%
25%
-
50
100
150
200
250
Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017
Routes (monthly avg.) Y-o-Y growth in tonne miles
New LNG Supply Set to Generate Incremental Tonne Miles
Growth in Trade Routes and Tonne Miles
18 | 2017 18 | 2017 2017 | 18
-
20
40
60
80
100
120
140
160
US$ ‘000/day ST Assessed Spot Charter Rates TFDE Assessed Spot Charter RatesTerm Fixtures: Existing Tonnage Term Fixtures: Newbuild Tonnage
(60)
(40)
(20)
-
20
40
60
Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-17 Jan-18 Jan-19 Jan-20
# Vsls Period of low to zero structural
availability
Speculative orders get
delivered Thin
Orderbook
245 212 202 202 201 209 205 200 185
-
50
100
150
200
250
US$ million
Minimum 26-Month
Construction Time Ne
wb
uild
Pri
ce
s
Str
uctu
ral A
va
ilab
ility
S
po
t &
Te
rm R
ate
s
Uncommitted NB Deliveries
1 3 1 1 1 2 1 1 -
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Earliest Yard
Delivery
Available
Only 11 Uncommitted
Newbuilds on the Orderbook
Shipping market
starts to tighten
183
NB Prices
lowest since
2008
When Will LNG Shipping Market Be Short?
19 | 2017 19 | 2017 2017 | 19
Tightening LNG Shipping Market on the back of New Supply
Overview of incremental LNGC vessel demand and supply through 2020
Source: Arctic Shipping
• The LNGC market is expected to tighten significantly with an estimated decrease in available tonnage of 56 vessel
equivalents in the period until 2020 on conservative assumptions
• There is substantial upside to these estimates as the current low ordering activity makes it highly uncertain that 10/35
newbuild vessels will be ordered with 2019/20 delivery
107
23
49
179
35
214
16
101
5
35
57
0
50
100
150
200
250
United States Australia Rest of World Vesselrequirement
Scrapping Demand afterrenewal
Delivered 2017to date
Orderbook Yard capacity'19
Yard capacity'20
Net decrease inavailabletonnage
# v
essels
63m tons
x
1.7vsl/ton
31m tons
x
0.75vsl/ton
38m tons
x
1.3vsl/ton
20 | 2017 20 | 2017 2017 | 20
Right Ships at the Right Time
Only 11 open LNGCs out of 101 through 2021
Source: FLEX LNG
# Vessels Most of the vessels on the LNGC orderbook are committed to long
term charters
• Currently, there are 101 LNGC newbuildings under construction
• 90% of the LNGC newbuildings built by 2020 are committed for
long term charters
FLEX LNG owns 6 out of the 11 open LNG newbuildings, four of
which delivers in 2018 and two in 2019
• Limited ordering – only 13 LNGC newbuildings contracted over
the last 18 months
• Ramp up of LNG global supply is expected to drive strong
demand for term charters of modern tonnage
• Incremental LNGC demand 30-50 vessels by 2020
• Most of the recent long-term charters have been MEGI or X-DF
vessels
28
41
19
2
1
5
5
0
5
10
15
20
25
30
35
40
45
50
2017 2018 2019 2020
Long Term Employment Uncommitted
21 | 2017 21 | 2017 2017 | 21
The LNG market is growing rapidly and 30-50 additional vessels are
expected to be required by 2020
• New export projects will add 25-30 mtpa of LNG per year over the
coming four years
• The current orderbook is insufficient to meet this demand for
LNGC
FLEX LNG is well positioned with six high spec MEGI newbuildings
delivering in 2018-2019 to provide customers with superior
transportation efficiency
• Further newbuildings will be considered as the market evolves
• The chartered-in vessels allows FLEX LNG to build a market
presence and establish operational experience ahead of its
owned fleet
• Building relationships with Charterers creates opportunities for the
forthcoming newbuildings
FLEX LNG Shipping Strategic Summary
U.S.’s first LNG export project : Cheniere’s Sabine Pass
Qatar's LNG production to boost from 77 to 100 mtpa within 5-7 years
22 | 2017 22 | 2017 2017 | 22 22 | 2017
03
22 | 2017
03
22 | 2017
03 MEGI Propulsion
23 | 2017 23 | 2017 2017 | 23
41%
8%
5%
42%
2%
39%
2%
59%
26%
74%
2010 2015 2022
-
10
20
30
40
50
'72
'73
'74
'75
'76
'77
'78
'79
'80
'81
'82
'83
'84
'85
'86
'87
'88
'89
'90
'91
'92
'93
'94
'95
'96
'97
'98
'99
'00
'01
'02
'03
'04
'05
'06
'07
'08
'09
'10
'11
'12
'13
'14
'15
'16
'17
'18
'19
'20
'21
'22
ST DFDE/TFDE Other XD-F MEGI
LNGC Engine Evolution
Phasing out Steam Vessels: Technology Shift Leading to Increased Efficiency and Carrying Capacity
Source: FLEX LNG
Trend Towards Modern Vessels is Visible in the Orderbook
LNGC Fleet and Orderbook by Propulsion
24 | 2017 24 | 2017 2017 | 24
A Three Tier Market has Emerged that Favors Modern LNGCs
LNG brokers began publishing assessed two-stroke (MEGI and X-DF) spot charter rates in Jan 2017
Sources: Arctic Shipping, Affinity, Clarkson
Assumptions: Sabine Pass – Tokyo Bay Round-Trip, HFO price $330/ton,
Estimated boil-off savings based on 0.12% for TFDE vs 0.09% for MEGI
USD/day
Comparison of LNG Ship Types on UTC Basis*
MEGI Equivalent Spot Charter Rates(1) COMPANY SNAPSHOT Three Tier Broker Assessments
0
0.2
0.4
0.6
0.8
1
ST 138k TFDE 160k X-DF 174k MEGI 174k
$ / mmbtu
45,000
61,910
7 530
1,212 2,000 3,938
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
DFDE 160kcbm spot
rate
Fuel savings Boil-offsavings
ReducedOPEX
Sizeadjustment
(+9%)
MEGIequivalentspot rate
USD/day
-
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
ST TFDE MEGI/X-DF Assessment
There are currently ten MEGIs on the water (all under term TC contracts)
25 | 2017 25 | 2017 2017 | 25
U.S. Gulf - Far East via
Panama 9,279 nm
U.S. Gulf -
Northwest Europe
4,961 nm
Arabian Gulf –
East Asia
5,760 nm
Arabian Gulf - Northwest
Europe
via Suez 6,377 nm
0.50 0.30
0.18 0.26 0.16 0.10
0.34 0.20 0.13
0.30 0.18 0.11
0.19
0.17
0.15 0.18
0.16 0.14
0.19 0.16
0.14
0.19
0.16 0.14
1.09
0.95
0.83 0.58
0.52 0.45
0.74
0.66
0.58
0.67
0.59
0.52
0.02
0.01
0.01
0.01
0.01
0.01
0.01
0.01 0.01
0.01
0.01
0.21
0.20
0.20
0.21
0.20
0.19
0.0
0.5
1.0
1.5
2.0
2.5
145k ST 160k TFDE 180k MEGI / X-DF 145k ST 160k TFDE 180k MEGI / X-DF 145k ST 160k TFDE 180k MEGI / X-DF 145k ST 160k TFDE 180k MEGI / X-DF
U.S. Gulf - Far East via Panama U.S. Gulf - NW Europe Arabian Gulf - Northwest Europe via Suez Arabian Gulf - East Asia
Boil Off Port Charges Charter Hire Fuel Canal Fees
US$ / mmbtu
2.01
1.63
1.37
1.23
0.85
0.70
1.49
1.17 1.05 1.04
0.79
0.95
N.B. US$70,000 per day applied as charter hire across vessel classes, LNG boil-off priced at US$5.50 / mmbtu
UTC Breakdown by Trade Route
Source: Poten & Partners
Unit Transportation Cost (UTC) Analysis - Critical Trade Route Summary
Critical Trade Routes Summary
26 | 2017 26 | 2017 2017 | 26
0.10 0.17 0.26
0.15 0.16
0.18
0.49 0.40 0.28
-
0.10
0.20
0.30
0.40
0.50
0.60
0.70
0.80
0.90
1.00
180k MEGI Newbuilding 5 Yr Old 160k TFDE 10 Yr Old 145k ST
Dominant Vessel Classes
Fuel
Charter Hire
Port Charges
Boil Off
Source: Poten & Partners
…However MEGI Vessels Offer a Substantial Competitive Advantage
UTC Equivalent Breakdown of Charter Rates for Dominant Vessel Technologies Over 7 Year Term
58,400
35,800 18,500
16,600
18,700
15,500
-
10,000
20,000 30,000
40,000
50,000
60,000
70,000
80,000
90,000
100,000
180k MEGI Newbuilding 5 Yr Old 160k TFDE 10 Yr Old 145k ST
Dominant Vessel Classes
Est. Average OpexRate
Est. Average CapexRate
Source: Poten & Partners
Gross Charter Rate (US$ ‘000 / day)
Operating UTC (US$ / mmbtu)
0.74 0.74 0.74
54,500
75,000
34,000
$
69,300
51,100
$
UTC Equivalent
Charter Rate
IRR Equivalent
Charter Rate
Operating UTCs Based on Balancing Charter Rates - Round Trip U.S. – NW Europe Basis
27 | 2017 27 | 2017 2017 | 27 27 | 2017
04
27 | 2017
04
27 | 2017
04 FSRU Market Development
28 | 2017 28 | 2017 2017 | 28
Significantly Reduced Construction Time
• Both Egyptian FSRUs were implemented in 5 months
from FID to commissioning
• Construction time for newbuilding ~ 28 – 30 months
Reduced Cost
• About half the investment CAPEX of a traditional onshore terminal
Flexibility
• FSRUs are usually chartered for a fixed period
• Most FSRUs can be traded as LNG Carriers
• Seasonal demand peaks
Reduced Footprint
• Near shore or offshore locations
• Does not occupy large and valuable coastal real estate
Become a local LNG Hub
• Coastal break bulk distribution
• Bunkering services
What are the Key Benefits of an FSRU?
Onshore vs. FSRU: Cost Comparison
Source: Thyssenkrupp
USD millions 3 mtpa, 180k m3 storage
Component Onshore
Terminal
FSRU
(newbuilding)
Jetty including piping 80 80
Unloading lines 100 N/A
Storage Tanks (180k cbm) 180 in FSRU
FSRU vessel N/A 250
Process plant 100 in FSRU
Utilities 60 in FSRU
Onshore interphase and
infrastructure
N/A 30
CAPEX 520 390
Contingency 30% onshore, 10%
FSRU
156 36
Owners Cost 74 54
Total CAPEX 750 480
29 | 2017 29 | 2017 2017 | 29
The FSRU market is poised to grow substantially over the next five
years
• Growth of LNG supply, low LNG prices, energy deficits, security
of supply issues and fuel switching due to mandated emissions
reductions are prime drivers
• NB FSRU are flexible, efficient and cost competitive compared
to conversions (with current yard prices)
• Based on the current supply-demand outlook, there is potential
for 12-15 new FSRU projects contracted by 2021
FLEX LNG has a highly experienced commercial and technical
team to succeed in the FSRU market
• FLEX LNG is actively pursuing FSRU opportunities and plan to
establish a presence in the FSRU market
• FLEX LNG will consider placing orders for NB FSRU to meet
the demand of fast track projects
• FSRU newbuildings can be delivered in 27-30 months
FLEX LNG FSRU newbuildings will have state of the art design
incorporating latest technologies and lessons learned
• Newbuilding prices of FSRUs have fallen and compete
favourably with conversion economics
LNG Imports: FSRUs vs. Land-Based Terminals
FSRU Gaining Market Share Over Traditional Import Terminals
Sources: Reuters, Affinity Shipping
Market Share: FSRU vs. Onshore Terminals
10% 10% 10%
10% 13% 14%
14% 16%
17% 19% 20%
(100)
100
300
500
700
900
1,100
2010 '11 '12 '13 '14 '15 '16 '17 (E) '18 (E) '19 (E) '20 (E)
Mtpa
Onshore Regas Capacity Floating Regas Capacity
30 | 2017 30 | 2017 2017 | 30
Up to 34 FSRU Projects Expected Operational by 2020
There are 21 active FSRU projects globally and 13 awarded projects (expected to begin operations in the next 3 years)
Sources: FLEX LNG, Affinity Shipping
Awarded FRSU projects:
2017: Russia, Pakistan
2018: Pakistan (2), Bangladesh,
Ghana, Uruguay, Puerto Rico
2019: Chile, Turkey, India
2020: Brazil
FLEX LNG team has
been involved in 13 of
the 21 existing FSRU
projects globally
Existing
Awarded
Existing &
Active:
21
Awarded:
13
Proposed:
50+
31 | 2017 31 | 2017 2017 | 31
FLEX LNG – NextDecade Alliance About NextDecade
FLEX LNG and NextDecade signed an HoA in December 2016 to
create a full value chain solution for LNG to international customers
• FLEX LNG will provide FSRU and dockside solutions to assist
LNG importing customers
In July 2017, NextDecade signed a MoU with the Port of Cork for a
new FSRU and associated LNG terminal infrastructure
• As Owners of the FSRU, FLEX LNG would charter out the unit
under a long-term contract FLEX LNG will provide FSRU and
dockside solutions to assist LNG importing customers
NextDecade is a leading US-based development and managment
company of onshore and floating LNG projects
• NextDecade’s key project is the Rio Grande LNG export project
under development in Brownsville, Texas
• The Rio Grande LNG export project is expected to have a
capacity of six liquefaction trains, each with a nominal LNG
capacity of 4.5 mtpa, yielding a total capacity of 27 mtpa
• FERC approval application filed in 2015, FID targeted for Q2 2018
with first cargo expected in 2022
Strategic Partnership with NextDecade
Next Decade’s proposed Rio Grande liquefaction terminal, Brownsville, Texas Port of Cork, Ireland
32 | 2017 32 | 2017 2017 | 32 32 | 2017
05
32 | 2017
05
32 | 2017
05 Summary
33 | 2017 33 | 2017 2017 | 33
LNG Carriers
FSRUs
FLEX LNG has a modern and efficient fleet of LNGCs available from 2018 offering Charterers
significant fuel savings and reduced boil-off rate over older vessels
• FLEX LNG has established proven operational capabilities and developed relationships with
key Charterers in the LNG market by chartering in and trading third party LNGCs
Majority shareholder Geveran Trading has a long history in the LNG industry and is committed
to building FLEX LNG into a major provider of LNGCs and FSRUs
• As part of the Fredriksen Group, FLEX LNG benefits from a wide range of commercial and
technical expertise, strong financial backing and access to competitive financing
The FSRU market is forecasted to grow substantially over the coming years, driven by growth
in LNG supply, low LNG prices and fuel switching driven by emission cuts
• Based on the current LNG supply-demand outlook, there is potential for 12-15 new FSRU
projects contracted by 2021
The FLEX LNG team has significant experience in developing and operating FSRU projects
globally
• FLEX LNG is actively pursuing opportunities in the FSRU market and is engaged in
discussions with multiple counterparties across various projects
Summary
The LNG market could experience significant shortage of tonnage from 2018
34 | 2017 34 | 2017 2017 | 34
Thank You November 2017
