The Rising Tide of Liquid Cargo on the

Inland WaterwaysSupply and Demand

Outlook for the Tank Barge Market

Ken EriksenSenior Vice President

May 1, 2014St. Louis, MO

@keriksen

Prepared for

Liquid Barge Commodities

2

New Found Oil Reserves Coming to the SurfaceA old technology brings gushing liquid gold

3

0

2,000

4,000

6,000

8,000

10,000

12,000

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

Th

ou

san

d B

arre

ls p

er D

ay

US Crude Oil Production

New Found Oil Reserves Coming to the Surface – Shale Plays and Refineries

4

Liquid Tank Barge Commodity Volumes

Distribution of Tons

178.3 million tons

Distribution of Ton-Miles

53.6 billion ton-miles

Historically chemical products and crude petroleum have been lower volume moves, but chemical has been longer distance while crude (and food and farm) shorter distance moves.

5

Liquid Commodity Movements – Surging Crude PetroleumCrude drives higher, others remain anemic.

6

0

20

40

60

80

100

120

140

199

0

199

1

199

2

199

3

199

4

199

5

199

6

199

7

199

8

199

9

200

0

200

1

200

2

200

3

200

4

200

5

200

6

200

7

200

8

200

9

201

0

201

1

201

2

201

3

201

4

Mil

lion

To

ns

Year

Domestic Barge Traffic TonsCrude Petroleum Petroleum & Coal Prod. Chemical Prod. Food & Farm Prod.

Going the Distance with Tank Movements

Longer distances emerging for crude shipments while other liquid remain static.

7

0

200

400

600

800

1,000

1,200

1,400

0

100

200

300

400

500

600

700

199

0

199

1

199

2

199

3

199

4

199

5

199

6

199

7

199

8

199

9

200

0

200

1

200

2

200

3

200

4

200

5

200

6

200

7

200

8

200

9

201

0

201

1

201

2

201

3

201

4

Ave

rag

e M

iles

Fo

od

& F

arm

Pro

d.

Ave

rag

e M

iles

Year

Domestic Barge Traffic Average Miles LiquidTank Crude Petroleum Petroleum & Coal Prod.

Chemical Prod. Food & Farm Prod.

Liquid Commodity Movements – Surging Crude PetroleumCrude drives higher, other remain anemic.

8

0

5

10

15

20

25

30

35

40

199

0

199

1

199

2

199

3

199

4

199

5

199

6

199

7

199

8

199

9

200

0

200

1

200

2

200

3

200

4

200

5

200

6

200

7

200

8

200

9

201

0

201

1

201

2

201

3

201

4

Bil

lio

n T

on

mil

es

Year

Domestic Barge Traffic TonmilesCrude Petroleum Petroleum & Coal Prod. Chemical Prod. Food & Farm Prod.

Barge Supply and Demand

9

Liquid Tank Barge Fleet Expanding

Shifting fleet profile, younger fleet emerging.

10

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

198

7

198

8

198

9

199

0

199

1

199

2

199

3

199

4

199

5

199

6

199

7

199

8

199

9

200

0

200

1

200

2

200

3

200

4

200

5

200

6

200

7

200

8

200

9

201

0

201

1

201

2

201

3

Nu

mb

er

Tan

k B

arg

es

by

Typ

e

Year

Composition of Tank Barge Fleet by Type

Small (10,000bbl or less)

Independent &Specialty

Semi-Integrated (>20,000 bbl)

Jumbo (10,001to 20,000 bbl)

Informa Economics, Inc., Barge Fleet Profile

0

25

50

75

100

125

150

175

200

225

250

275

300

1969

1970

1971

1972

1973

1974

1975

1976

1977

1978

1979

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

44+43 42 41 40 39 38 37 36 35 34 33 32 31 30 29 28 27 26 25 24 23 22 21 20 19 18 17 16 15 14 13 12 11 10 9 8 7 6 5 4 3 2 1 0

Nu

mb

er o

f Ta

nk

Bar

ges

Age (Number of Years)

Age Profile of 2013 Tank Barge Fleet

22% of the Fleet >25 yrs. 70% of the Fleet <20yrs.

Informa Economics, Inc., Barge Fleet Profile

Liquid Tank Barge Fleet Pressure Indices

Tonnage versus Ton-Miles? Fleet dynamics, capacity utilization tied to distances traveled.

11

-40

-20

0

20

40

60

80

100

120

140

198

7

198

8

198

9

199

0

199

1

199

2

199

3

199

4

199

5

199

6

199

7

199

8

199

9

200

0

200

1

200

2

200

3

200

4

200

5

200

6

200

7

200

8

200

9

201

0

201

1

201

2

201

3

201

4

Ind

ex (

1998

= 1

00)

Year

Tank Barge Utilization on Tonmile BasisTonnage Tank Barge Informa's Barge Pressure Index

-20

0

20

40

60

80

100

120

140

198

7

198

8

198

9

199

0

199

1

199

2

199

3

199

4

199

5

199

6

199

7

199

8

199

9

200

0

200

1

200

2

200

3

200

4

200

5

200

6

200

7

200

8

200

9

201

0

201

1

201

2

201

3

201

4

Ind

ex (

1998

= 1

00)

Year

Tank Barge UtilizationTonnage Tank Barge Informa's Barge Pressure Index

Liquid Tank Barge Fleet to Expand Further to Keep Pressure Steady

12

0

700

1,400

2,100

2,800

3,500

4,200

-300

-200

-100

0

100

200

300

198

9

199

0

199

1

199

2

199

3

199

4

199

5

199

6

199

7

199

8

199

9

200

0

200

1

200

2

200

3

200

4

200

5

200

6

200

7

200

8

200

9

201

0

201

1

201

2

201

3

201

4F

Siz

e o

f Ta

nk

Fle

et

Nu

mb

er o

f Ta

nk

Bar

ges

Year

Annual Tank Barge New Builds and Retirements

New BuildsRetirementsTank Fleet Size

Informa Economics, Inc., Barge Fleet Profile

The Rising Tide of Liquid Cargo on the

Inland WaterwaysSupply and Demand

Outlook for the Tank Barge Market

Ken EriksenSenior Vice President

May 1, 2014St. Louis, MO

@keriksen

Prepared for