Cost Benefit Analysis for STS Transfer Operation

8.8.1

Scenario 1 - Charter of One (1) LGC as Storage and One (1) Pressurized as Shuttle

Scenario 1 - STS Transfer operation is conducted at Linggi Port using LGC of 30,000 MT (60,000 cbm) as storage and 1,800 MT (4,000 cbm) as shuttle tanker in transferring 18,333 MT of LPG (60% / 40%) to Westports via 10 shipments of 1,764 MT / shipments and 1 shipment of 693 MT.
Cost for 52.3 days 1 Refrigerated Tanker (i) Time Charter PCM (ii) Bunker Storage @ 2 tons HFO USD 593 / MT Total Daily Rate 2 Pressurized Tanker (i) Time Charter PCM Daily Rate 3 Cost of Bunker Pressurized (i) Bunker Sea (6.4 days @ 10 tons / day USD 593) (ii) Bunker port (21 days @ 2 tons / day USD 855) (iii) Bunker idle (24.9 days @ 1.5 tons / day USD 855) Total Cost / MT @ 18,333 4 5 STS Cost @ USD 11 / MT (22,000 MT) Port Charges (Pressurized Only) 11 shipments (i) Marine Consolidated Charges (USD 1,376 per ship call) (ii) **Conventional Charges Total Cost / MT @ 18,333 Total STS Transfer Cost:
Table 8.12: Total Operating Cost for Scenario 1

Cost / MT

540,000.00 35,580.00 575,580.00 19,186.00 1,003,428.00 54.73

261,000.00 8,700.00 455,010 24.82

37,952.00 35,910.00 31,934.00 105,796.00 5.77 242,000.00 11.00

15,136.00 45,806.95 60,942.95 3.32 99.65

**Conventional Charges:
Item Port charges Dangerous Good Wharfage Dangerous Good Fire Fighting SFO - Att MISC FIRE JPO - Att MISC FIRE NCO - Att MISC FIRE FE & Equip Quantity 18,333 MT 18,333 MT 14 hours 14 hours 28 hours 14 hours Rate (USD) 1.15 / MT 1.00 / MT 8.60 / Hour 5.70 / Hour 4.30 / Hour 18.60 / Hour Amount 21,082.95 18,333.00 120.40 79.80 120.40 260.40 Total Total 21,082.95 18,333.00 1,324.40 877.80 1,324.40 2,864.40 45,806.95 Per vessel call Remarks Per MT Per MT

Cost Benefit Analysis for STS Transfer Operation

8.8.2

Scenario 2 Charter of One (1) VLGC as Storage and One (1) Pressurized as Shuttle

Scenario 2 - STS Transfer operation is conducted at Linggi port using VLGC of 50,000 MT (100,000 cbm) as storage and 1,800 MT (4,000 cbm) as shuttle tanker in transferring 18,333 MT of LPG (60% / 40%) to Westports via 10 shipments of 1,764 MT / shipments and 1 shipment of 693 MT.
Cost for 52.3 days 1 Refrigerated Tanker (i) Time Charter PCM 594,000.00 35,580.00 629,580.00 20,986.00 1,097,568.00 59.87 Cost / MT

(ii) Bunker Storage @ 2 tons HFO USD 593 / MT Total Daily Rate 2 Pressurized Tanker (i) Time Charter PCM

261,000.00 8,700.00 455,010.00 24.82

Daily Rate 3 Cost of Bunker Pressurized (i) Bunker Sea (6.4 days @ 10 tons / day USD 593)

37,952.00 35,910.00 31,934.00 105,796.00 5.77 242, 000.00 11.00

(ii) Bunker port (21 days @ 2 tons / day USD 855) (iii) Bunker idle (24.9 days @ 1.5 tons / day USD 855) Total Cost/MT @ 18,333 4 5 STS Cost @ USD 11 / MT (22,000 MT) Port Charges (Pressurized Only) 11 shipments (i) Marine Consolidated Charges - (USD 1,376 per ship call) (ii) **Conventional Charges

15,136.00 45,806.95 60,942.95 3.32

Total Cost / MT @ 18,333 Total STS Transfer Cost:

Table 8.13: Total Operating Cost for Scenario 2

104.78

**Conventional Charges:
Item Port charges Dangerous Good Wharfage Dangerous Good Fire Fighting SFO - Att MISC FIRE JPO - Att MISC FIRE NCO - Att MISC FIRE FE & Equip Quantity 18,333 MT 18,333 MT 14 hours 14 hours 28 hours 14 hours Rate (USD) 1.15 / MT 1.00 / MT 8.60 / Hour 5.70 / Hour 4.30 / Hour 18.60 / Hour Amount 21,082.95 18,333.00 120.40 79.80 120.40 260.40 Total Total 21,082.95 18,333.00 1,324.40 877.80 1,324.40 2,864.40 45,806.95 Per vessel call Remarks Per MT Per MT

Cost Benefit Analysis for STS Transfer Operation

8.8.3

Scenario 3 Charter of One (1) VLGC as Storage and Shuttle

Scenario 3 - STS Transfer operation is conducted at Linggi Port using VLGC of 50,000 MT (100,000 cbm) as storage and transferring of the cargo to Westports via 9 shipments of 2,037 MT / shipments.

Cost for 48 days 1 Refrigerated Tanker (i) Time Charter PCM 2 Total Daily Rate 3 Cost of Bunker (i) Bunker Sea (3.5 days @ 50 tons / day @ USD 593) 103,775.00 27,360.00 62,415.00 193,550.00 594,000.00 594,000.00 19,800.00 950,400.00

Cost/MT

51.84

(ii) Bunker port (8 days @ 4 tons / day @ USD855) (iii) Bunker idle (36.5 days @ 2 tons / day @ USD855) Total Cost/MT @ 18,333 4 5 STS Cost* Port Charges (VLGC Only) 9 shipments (i) (ii) Marine Consolidated Charges (USD 10,779 per ship call) **Conventional Charges

10.56 0

97,011.00 44,644.95 141,655.95 7.73

Total Cost / MT @ 18,333 Total STS Transfer Cost:

70.13

Table 8.14: Total Operating Cost for Scenario 3

*Cost of STS to be absorbed by Supply Vessel

**Conventional Charges:
Item Port charges Dangerous Good Wharfage Dangerous Good Fire Fighting SFO - Att MISC FIRE JPO - Att MISC FIRE NCO - Att MISC FIRE FE & Equip Quantity 18,333 MT 18,333 MT 14 hours 14 hours 28 hours 14 hours Rate (USD) 1.15 / MT 1.00 / MT 8.60 / Hour 5.70 / Hour 4.30 / Hour 18.60 / Hour Amount 21,082.95 18,333.00 120.40 79.80 120.40 260.40 Total Total 21,082.95 18,333.00 1,083.60 718.20 1,083.60 2,343.60 44,644.95 Per vessel call Remarks Per MT Per MT

Cost Benefit Analysis for STS Transfer Operation

8.8.4

Scenario 4 Charter of VLGC and Shuttle tanker to transport Summit monthly usage and sell off the balance of 11,133 MT

Scenario 4 - Summit brings in 22,000 MT of refrigerated LPG from Qatar and Summit monthly usage is 7,200 MT / month. Hence, potential LPG mix for sale to open market is 18,333 MT - 7,200 MT = 11,133 MT. If Summit is able to sell the balance of its monthly production, then Summit has to transfer 7,200 MT of cargo to Westports via 5 shipments of 1,440 MT / shipments over a period of 30 days. Thus the charges will be as follows:
Cost / 30 days 1 Refrigerated Tanker (i) Time Charter PCM 594,000.00 35,580.00 629,580.00 20,986.00 629, 580.00 34.34 Cost / MT

(ii) Bunker Storage @ 2 tons MFO USD 593 / MT Total Daily Rate 2 Pressurized Tanker (i) Time Charter PCM

261,000.00 8,700.00 261,000.00 14.24

Daily Rate 3 Cost of Bunker Pressurized (i) Bunker Sea (1.5 days @ 10 tons / day @ USD 593)

8,895.00 17,100.00 23,726.00 49,721.00 2.71 242,000.00 11.00

(ii) Bunker port (10 days @ 2 tons / day @ USD 855) (iii) Bunker idle (18.5 days @ 1.5 tons / day @ USD 855) Total Cost/MT @ 18,333 4 5 STS Cost @ USD 11 / MT (22,000 MT) Port Charges (Pressurized Only) 5 shipments (i) (ii) Total Cost/MT @ 18,333 Total STS Transfer Cost: Marine Consolidated Charges (USD 1,376 per ship call) **Conventional Charges

6,880.00 18,385.00 25,265.00 1.38 63.67

Table 8.15: Total Operating Cost for Scenario 4

**Conventional Charges:
Item Port charges Dangerous Good Wharfage Dangerous Good Fire Fighting SFO - Att MISC FIRE JPO - Att MISC FIRE NCO - Att MISC FIRE FE & Equip Quantity 7,200 MT 7,200 MT 14 hours 14 hours 28 hours 14 hours Rate (USD) 1.15 / MT 1.00 / MT 8.60 / Hour 5.70 / Hour 4.30 / Hour 18.60 / Hour Amount 8,280.00 7,200.00 120.40 79.80 120.40 260.40 Total Total 8,280.00 7,200.00 602.00 399.00 602.00 1,302.00 18,385.00 Per vessel call Remarks Per MT Per MT

Cost Benefit Analysis for STS Transfer Operation

8.8.5

Scenario 5- Charter of one VLGC as storage and shuttle to transport Summits monthly usage and sell off the balance of 11,133 MT

Scenario 5 - Summit brings in 22,000 MT of refrigerated LPG from Qatar and Summit monthly usage is 7,200 MT / month (360 MT / day @ 20 days working). Hence, potential LPG mix for sale is 18,333 MT - 7,200 MT = 11,133 MT.

STS Transfer operation is conducted at Linggi Port using VLGC of 50,000 MT (100,000 cbm) as storage and transferring of the cargo to Westports via 4 shipments of 1,800 MT over 30 days.
Cost for 30 days 1 Refrigerated Tanker (i) 2 Time Charter PCM 594,000.00 594,000.00 19,800.00 594,000 32.40 Cost/MT

Total Daily Rate

Cost of Bunker (i) (ii) Bunker Sea (2.4 days @ 50 tons / day @ USD 593) Bunker port (8 days @ 4 tons / day @ USD 855) 71,160.00 27,360.00 33,516.00 132,036.00 7.21 0

(iii) Bunker idle (19.6 days @ 2 tons / day @ USD 855) Total Cost/MT @ 18,333 4 5 STS Cost* Port Charges (VLGC Only) 4 shipments (i) Marine Consolidated Charges (USD 10,779 per ship call) (ii) **Conventional Charges Total Cost/MT @ 18,333 Total STS Transfer Cost:

43,116.00 17,804.00 60,920.00 3.32 42.93

Table 8.16: Total Operating Cost for Scenario 5

**Conventional Charges:
Item Port charges Dangerous Good Wharfage Dangerous Good Fire Fighting SFO - Att MISC FIRE JPO - Att MISC FIRE NCO - Att MISC FIRE FE & Equip Quantity 7,200 MT 7,200 MT 14 hours 14 hours 28 hours 14 hours Rate (USD) 1.15 / MT 1.00 / MT 8.60 / Hour 5.70 / Hour 4.30 / Hour 18.60 / Hour Amount 8,280.00 7,200.00 120.40 79.80 120.40 260.40 Total Total 8,280.00 7,200.00 481.60 319.2 481.60 1,041.60 17,804.00 Per vessel call Remarks Per MT Per MT

Cost Benefit Analysis for STS Transfer Operation

8.8.6

Scenario 6 Summit bring in 44,000 MT and Charter of One VLGC and One Pressurized tanker for Summits monthly usage and sell off 29,467 MT for open market

Scenario 6 - Summit brings in 44,000 MT of refrigerated LPG from Qatar and Summit monthly usage is 7, 200 MT / month (360 MT / day @ 20 days working). Hence, potential LPG mix for sale is 36,667 MT 7,200 MT = 29,467 MT. If Summit is able to sell the balance of its monthly production, then Summit has to transfer 7,200 MT of cargo to Westports via 5 shipments of 1,440 MT / shipments over a period of 30 days. The balance of cargoes will be sell off in the open market within 30 days. Hence the charges will be as follows:
Cost for 30 days 1 Refrigerated Tanker (i) Time Charter PCM 594,000.00 35,580.00 629,580.00 20,986.00 629,580.00 17.17 (ii) Bunker Storage @ 2 tons MFO USD 593 / MT Total Daily Rate 2 Pressurized Tanker (i) Time Charter PCM 261,000.00 8,700.00 261,000.00 7.12 Daily Rate 3 Cost of Bunker Pressurized (iii) Bunker Sea (1.5 days @ 10 tons / day @ USD 593) (iv) Bunker port (10 days @ 2 tons / day @ USD 855) (v) Bunker idle (18.5 days @ 1.5 tons / day @ USD 855) Total Cost/MT @ 36,667 MT 4 5 STS Cost @ USD 11 / MT (44,000 MT) Port Charges (Pressurized Only) 5 shipments (i) (ii) Total Cost/MT @ 36,667 MT Total STS Transfer Cost:
Table 8.17: Total Operating Cost for Scenario 6

Cost / MT

8,895.00 17,100.00 23,726.00 49,721.00 1.36 484,000.00 11.00

Marine Consolidated Charges - (USD 1,376 per ship call) Conventional Charges

6,880.00 18,385.00 25,265.00 0.69 37.33

**Conventional Charges:
Item Port charges Dangerous Good Wharfage Dangerous Good Fire Fighting SFO - Att MISC FIRE JPO - Att MISC FIRE NCO - Att MISC FIRE FE & Equip Quantity 7,200 MT 7,200 MT 14 hours 14 hours 28 hours 14 hours Rate (USD) 1.15 / MT 1.00 / MT 8.60 / Hour 5.70 / Hour 4.30 / Hour 18.60 / Hour Amount 8,280.00 7,200.00 120.40 79.80 120.40 260.40 Total Total 8,280.00 7,200.00 602.00 399.00 602.00 1,302.00 18,385.00 Per vessel call Remarks Per MT Per MT

Cost Benefit Analysis for STS Transfer Operation

8.8.7

Scenario 7- Summit importing 44,000 MT and charter one VLGC as storage and shuttle. 29,467 MT to be sell off in the open market within 30 days

Scenario 7 - Summit brings in 44,000 MT of refrigerated LPG from Qatar and Summit monthly usage is 7, 200 MT / month (360 MT / day @ 20 days working). Hence, potential LPG mix for sale is 36,667 MT 7,200 MT = 29,467 MT. STS Transfer operation is conducted at Linggi Port using VLGC of 50,000 MT (100,000 cbm) as storage and transferring of the cargo to Westports via 4 shipments of 1,440 MT over 30 days.

The balance of cargoes will be sold off in the open market within 30 days.
Cost for 30 days 1 Refrigerated Tanker (i) 2 Time Charter PCM 594, 000 .00 594, 000.00 19, 800.00 594, 000 16.20 Cost/MT

Total Daily Rate

Cost of Bunker (iii) Bunker Sea (2.4 days @ 50 tons / day @ USD 593) (iv) Bunker port (8 days @ 4 tons / day @ USD 855) (v) Bunker idle (19.6 days @ 2 tons / day @ USD 855) 71,160.00 27,360.00 33,516.00 132,036.00 3.60 0

Total Cost/MT @ 36,667 MT 3 4 STS Cost* Port Charges (VLGC Only) 4 shipments (vi) Marine Consolidated Charges (USD 10,779 per ship call) (vii) Conventional Charges Total Cost/MT @ 36,667 MT Total STS Transfer Cost:

43,116.00 17,804.00 60,920.00 1.66 21.46

Table 8.18: Total Operating Cost for Scenario 7

**Conventional Charges:
Item Port charges Dangerous Good Wharfage Dangerous Good Fire Fighting SFO - Att MISC FIRE JPO - Att MISC FIRE NCO - Att MISC FIRE FE & Equip Quantity 7,200 MT 7,200 MT 14 hours 14 hours 28 hours 14 hours Rate (USD) 1.15 / MT 1.00 / MT 8.60 / Hour 5.70 / Hour 4.30 / Hour 18.60 / Hour Amount 8,280.00 7,200.00 120.40 79.80 120.40 260.40 Total Total 8,280.00 7,200.00 481.60 319.2 481.60 1,041.60 17,804.00 Per vessel call Remarks Per MT Per MT

Cost Benefit Analysis for STS Transfer Operation

8.9

Comparison of Cost of Each Scenario

The summary of all the 7 scenarios presented is simplified in Table 8.13: Comparison of each scenario.
Scenario Vessel Type Imported LPG Volume (MT) Storage Vessel Type Storage Vessel Capacity (MT) Total Storage Days Shuttle Vessel type Shuttle Vessel Capacity (MT) No of Shipment Avg Volume per Shipment (MT) STS Operation Charges (TAG Marine) Commercial LPG Volume (60:40) / Summit LPG Trading LPG Trading Volume Potential LPG Trading Income @ USD 10 / MT Total STS Cost (USD) / MT CIF (USD) Total (USD) / Landed Cost Expected LPG 2011 (current practice) Surplus Scenario 1 VLGC 22,000 LGC 30,000 52.3 Pressurized 1,800 11 1,666.64 Scenario 2 VLGC 22,000 VLGC 50,000 52.3 Pressurized 1,800 11 1,666.64 Scenario 3 VLGC 22,000 VLGC 50,000 48 Na Na 9 2,037 Scenario 4 VLGC 22,000 VLGC 50,000 30 Pressurized 1,800 5 1,440 Scenario 5 VLGC 22,000 VLGC 50,000 30 Na Na 4 1,800 Scenario 6 VLGC 44,000 VLGC 50,000 30 Pressurized 1,800 5 1,440 Scenario 7 VLGC 44,000 VLGC 50,000 30 Na Na 4 1,800

Yes 18,333 No Na Na 99.65 45.00 144.65

Yes 18,333 No Na Na 104.78 45.00 149.78

Na 18,333 No Na Na 70.13 45.00 115.13

Yes 7,200 Yes 11,133 111,330 63.67 45.00 108.67

No 7,200 Yes 11,133 111,330 42.93 45.00 87.93

Yes 7,200 Yes 29,467 294,670 37.33 35.00* 72.33

No 7,200 Yes 29,467 294,670 21.46 35.00* 56.46

80 (64.65)

80 (69.78)

80 (35.13)

80 (28.67)

80 (7.93)

80 7.67

80 23.54

Table 8.19: Comparison for each Scenario

*CIF cost to SEA Region (Full VLGC Cargo)

Based on the above comparative table, Scenario 2 is record the highest LPG landed costs and Scenario 7 show the least landed costs. It is no doubt charter only one vessel acted as both storage and shuttle is the cheaper option for STS operations.