FPSO BEST PRACTICES Joint Industry Project JIP June

FPSO BEST PRACTICES Joint Industry Project (JIP) June 24, 2020

Clive Vaughan Senior Advisor • 39 -year track record in the Oil & Gas Industry • Experience from feasibility through to start-up and operational support • Developed and delivered new Front-End processes PAGE 2 © Endeavor Management. All Rights Reserved. www. endeavoreag. com 2

Bruce Crager Executive Vice President Expert Advisory Group • 46 years of Industry Experience • Multiple Senior Industry Roles • Involved with over 20 FPSO Projects PAGE 3 © Endeavor Management. All Rights Reserved. www. endeavoreag. com 3

Jeff Dice JIP Project Manager • 28 years experience as a structural engineer and project manager • Extensive experience with FPSO, TLP, Spar, and Semis • Combines operator and contractor perspectives with decisive, analytical talents PAGE 4 © Endeavor Management. All Rights Reserved. www. endeavoreag. com 4

Webinar Guidelines • Everyone is on mute • Submit questions on chat • Survey will be sent to all and those who respond will receive: • Slides from Today’s Webinar • Recording of Webinar • JIP Proposal PAGE 5 © Endeavor Management. All Rights Reserved. www. endeavoreag. com

UPSTREAM EXPERT ADVISORY GROUP Bridging the Gap Global Presence Expert Advisory Teams PAGE 6 Arctic Brazil Capital Project Effectiveness Construction and Installation Decommissioning Digital Due Diligence Field Development Mediation, Arbitration and Legal (MALS) Onshore Operational Effectiveness Revenue Generation Support Subsea Subsurface Advisory © Endeavor Management. All Rights Reserved. 200 35 Seasoned expert advisors. Average years tenure in the oilfield. >55 Number of technical disicplines covered. www. endeavoreag. com 6

FPSO INDUSTRY UPDATE COURTESY OF ENERGY MARITIME ASSOCIATES PAGE 7 7 PAGE © Endeavor Management. All Rights © Endeavor Management. All Reserved. Rights Reserved. www. endeavoreag. com www. endeavormgmt. com

Worldwide FPSOs by Status Courtesy of Energy Maritime Associates June 2020 PAGE 8 ©

FPSO Owners by Fleet Size Courtesy of Energy Maritime Associates June 2020 For Sale / For Sale Lease Available 11 5 Installed On Order Total 11 5 Lease 15 73 10 98 Lease/ Own 2 2 Note: 2 units under Lease/Own: SBM’s Fast 4 Ward #4 &#5 PAGE 9 © Endeavor Management. All Rights Reserved. www. endeavoreag. com Own 1 95 10 106 Total 32 168 22 222

FPSO Field Operators by Fleet Size PAGE 10 © Endeavor Management. All Rights Reserved.

FPSOs: Operator Owned vs. Contractor Owned Installed Lease/Own Lease Own Total 73 95 168 On Order 2 10 10 22 Total 2 83 105 190 % 1% 44% 55% 100% Courtesy of Energy Maritime Associates June 2020 PAGE 11 © Endeavor Management. All Rights Reserved. www. endeavoreag. com

FPSOs: Conversion vs. Newbuild vs. Redeployment Hull Type On Order Available Installed Conv 8 21 95 New 13 6 56 Redeploy 1 5 17 Total 22 32 168 Total 124 75 23 222 % 56% 34% 100% Courtesy of Energy Maritime Associates June 2020 PAGE 12 © Endeavor Management. All Rights Reserved. www. endeavoreag. com

FPSO Orderbook PAGE 13 © Endeavor Management. All Rights Reserved. Courtesy of Energy Maritime

FPSOs by Status and Region Courtesy of Energy Maritime Associates June 2020 Available, Installed,

JOINT INDUSTRY PROJECT OVERVIEW PAGE 1515 PAGE © Endeavor Management. All Rights © Endeavor Management. All Reserved. Rights Reserved. www. endeavoreag. com www. endeavormgmt. com

Need for FPSO Best Practices JIP Alignment § Collaborative across the industry—including between Operating Partners § Consider all Stakeholder concerns § Improve delivery time Execution § Reduce costs § Fit for Purpose solutions § More reliance on industry standards and specs Safety § More consistent operational procedures across the industry § Sharing of best safety practices PAGE 16 © Endeavor Management. All Rights Reserved. www. endeavoreag. com

Why Now for Sharing FPSO Best Practices ? • FPSOs still preferred concept • FPSO expertise leaving industry and JIP is an excellent way to capture key learnings • Industry needs low cost solutions and sharing could make non-commercial projects viable • Current industry slow down allows sharing across: • Operators • Leased FPSO Providers • Shipyards • Class Societies • Starting this year allows: • 50% Funding in 2020, 50% Funding to be in 2021 • Utilize current funds • Budget future funds PAGE 17 © Endeavor Management. All Rights Reserved. www. endeavoreag. com

FPSO Best Practice Topics – Endeavor Topic Lead A. Strategic Decisions………………… Rich Keig B. Project Delivery…………. . Jeff Dice C. Mooring & Offloading…………… Mark Danaczko D. Hull Design………………. Brian Gibbs E. Process Module Design…………. Richard Thompson F. Vapor Gas and Water……………. . Richard Thompson G. Redeployment……………. David Tuturea H. Operational Considerations…… John Lovell PAGE 18 © Endeavor Management. All Rights Reserved. www. endeavoreag. com

A PAGE 1919 PAGE STRATEGIC DECISIONS © Endeavor Management. All Rights © Endeavor Management. All Reserved. Rights Reserved. www. endeavoreag. com www. endeavormgmt. com

Strategic Decisions Reservoir Characteristics & Location Country, Flag and Class / Industry Standards Contracts Technical Specification Operator Experience & Preference Own vs. Lease Industry Standards Cost & Schedule Implications PAGE 20 © Endeavor Management. All Rights Reserved. Contractors Experience & Preference www. endeavoreag. com

B PAGE 2121 PAGE PROJECT DELIVERY © Endeavor Management. All Rights © Endeavor Management. All Reserved. Rights Reserved. www. endeavoreag. com www. endeavormgmt. com

Project Delivery Contract Requirements & Technical Specification Team Makeup & Team Size Owner / Operator Team Contractor Teams Interface Management System Change Management System Engineering Deliverables Schedule PAGE 22 © Endeavor Management. All Rights Reserved. Component Deliverables Schedule www. endeavoreag. com

C PAGE 2323 PAGE MOORING & OFFLOADING © Endeavor Management. All Rights © Endeavor Management. All Reserved. Rights Reserved. www. endeavoreag. com www. endeavormgmt. com

Mooring and Offloading Considerations should include § Site-Specific Environmental/Metocean Conditions § Need to Disconnect FPSO for Iceberg/Hurricane Events ? § Requirement for the Risers/Umbilicals (size, number, pressure rating) § Type of Export Tanker (DP or Standard Tanker w/tug assist) § Capital and Operational Costs § Perceived Operational Risks PAGE 24 © Endeavor Management. All Rights Reserved. www. endeavoreag. com

Mooring and Offloading Discussion Industry has deployed a wide range of mooring/offloading options, including: • Spread Mooring Systems • Passive (naturally “weathervaning” ) • Active Turret-based Systems (thruster assist for position control) • Disconnectable Turret-based Mooring systems • Full Dynamic Positioning with no mooring lines • Direct Offloading to Tanker or via CALM Buoy System Based on reviewing existing FPSO installations, there does not appear to be a single or “standard” mooring/offloading solution for a given operating region. PAGE 25 © Endeavor Management. All Rights Reserved. www. endeavoreag. com

D PAGE 2626 PAGE HULL DESIGN © Endeavor Management. All Rights © Endeavor Management. All Reserved. Rights Reserved. www. endeavoreag. com www. endeavormgmt. com

Hull Selection: Newbuild vs. Conversion Threats and Challenges Newbuild Conversion Definition of success PAGE 27 § Inappropriate hull specification for FPSO service § Longer time to delivery § Need for propulsion system? § § § Condition, trading & maintenance history uncertain Uncertain remaining hull fatigue life Lack of options to meet double side requirements Corrosion protection – coatings and CP – need renewal strategy Adequacy and condition of cargo handling system § Early preparation of a comprehensive Statement of Requirements § Structured basis for conversion hull selection or newbuild design § Evaluation of conversion candidates: database review, inspections © Endeavor Management. All Rights Reserved. www. endeavoreag. com

E PAGE 2828 PAGE PROCESS MODULE DESIGN © Endeavor Management. All Rights © Endeavor Management. All Reserved. Rights Reserved. www. endeavoreag. com www. endeavormgmt. com

Process Module Design and Placement § Module Arrangement to reduce Risk to Crew Key Considerations § High Pressure Equipment Farthest from Crew Quarters § Module Sizing, Construction & Installation § Crew Safety § Number of Modules § FPSO Operability § Interfaces and Integration Considerations § Process Module/Hull Interfaces § Independent component installation on hull vs. larger modules § Operability Issues § Module Placement § Equipment placement within Modules PAGE 29 © Endeavor Management. All Rights Reserved. www. endeavoreag. com

Process/Hull Interface Issues • Different Design Methodologies between Marine and Process Systems • Different FEA Models • Different Specifications and Standards • Structural and Piping Interface Issues • Structural Elements to Attach Process Modules to Hull • Piping and Electrical Interfaces • Between Process Modules, Accommodations, and Hull Systems PAGE 30 © Endeavor Management. All Rights Reserved. www. endeavoreag. com

F PAGE 3131 PAGE VAPOR, GAS AND WATER © Endeavor Management. All Rights ©

Gas Disposition Common methods § Flaring, Venting, re -injection, use as fuel, gas conversion to liquid, or other options. HSE considerations § Impact on risk to crew and facilities § Impact on greenhouse gas emissions Operational Considerations § Reliability and Maintainability § Required crew competence to safely and effectively operate the system § What are benefits & downsides of each? PAGE 32 Opex vs Capex Interface issues § What effect does each method have on OPEX and CAPEX? § What effect does the method selected have on vapor recovery? § What are the tradeoffs? § Interface with the rest of the process facilities? . § Interface with the marine systems? © Endeavor Management. All Rights Reserved. www. endeavoreag. com

Vapor and Water Disposal Vapor recovery Water disposal PAGE 33 § § § What effect does vapor recovery have to reduce greenhouse gases? Carbon tax considerations? What is the state of the art for venting and vapor recovery? HSE considerations Interface issues with gas disposition system/process and marine systems. CAPEX vs OPEX What is the state of the art related to new and low-cost technologies? Is old and heavy more robust than new technology? HSE considerations. Flag State/Coastal State/Class Regulations--both current and future. System flexibility--Can the system be turned down or up if the injectivity is not as expected? § Reservoir considerations such as rate, pressure, solids content, fluid compatibility and changing reservoir requirements over time. § § § © Endeavor Management. All Rights Reserved. www. endeavoreag. com

G PAGE 3434 PAGE REDEPLOYMENT © Endeavor Management. All Rights © Endeavor Management. All

Redeployment Advantages Threats & Challenges PAGE 35 § § § Faster track to first oil at new location Potential low-cost development § § § § Lack of advance strategy and planning for potential future redeployments Uncertainty surrounding timing and availability Specification gaps could be substantial for meeting new field requirements Regulatory/Class permits/approvals not understood Excessive topsides modifications may be needed Extensive hull life extension work may be required Mooring, risers and umbilical issues not understood May be more suitable for Extended Well Test or Early Production System Shorter start-up and commissioning period if properly planned Crew experienced in operation & maintenance of process system may be able to move with vessel © Endeavor Management. All Rights Reserved. www. endeavoreag. com

How to Achieve Redeployment Success • Take advantage of FPSO repurposing flexibility in early strategic planning, consider potential future deployment locations in original design specifications • Understand regulatory constraints surrounding potential future moves during initial vessel acquisition process. • Provide suitable system by system commissioning/handover plan and process including a well documented handover package and 3 D model for the initial FPSO project. • Achieve the right level of Operations input and assistance PAGE 36 © Endeavor Management. All Rights Reserved. www. endeavoreag. com

H PAGE 3737 PAGE OPERATIONAL CONSIDERATIONS © Endeavor Management. All Rights © Endeavor Management.

Operational Best Practices The Premise The Rationale PAGE 38 § Multiple operators and FPSO contractors simultaneously develop their own specific operational procedures § Most procedures are generally similar from one operator and contractor to another § Essential functions of an FPSO are the same or similar wherever they are and whatever the design § Millions of man hours can be saved by establishing common operational procedures § Improved operational efficiency § Greater certainty of routine safety practices § Efficient transfer of crewmember skills between FPSOs © Endeavor Management. All Rights Reserved. www. endeavoreag. com

JIP PROCEDURES AND COMMERCIAL INFORMATION PAGE 3939 PAGE © Endeavor Management. All Rights ©

JIP Information § Cost per participant of $79, 000 § Payment: Half at Inception, Half after Final Report § Schedule of 5 months to complete JIP § JIP Methodology--Endeavor Advisors will: • Serve as Lead for each of the 8 topics • Develop initial Best Practices based on Participant Input and Endeavor Advisor Experience • Confirm Best Practices with participating companies as appropriate • Draft the Best Practice for each topic for Participant review PAGE 40 © Endeavor Management. All Rights Reserved. www. endeavoreag. com

Example of JIP Methodology Operational Considerations (Topic H) Stage One • General review of existing Operating Procedures as developed and used by different Owners and Operators Stage Two • Compare and contrast results of Stage One • Work with Operators and Owners to agree optimum framework and content of Best Operating Procedures Stage Three • Develop Guidelines for Operating Procedures for FPSOs (Examples below) Operating Procedures Safety Management System Stage Three PAGE 41 Maintenance Management Standardized System Training Matrices Crew Job Regulatory Crew Descriptions Compliance Management & Training • Identify field specific operational issues © Endeavor Management. All Rights Reserved. www. endeavoreag. com

Other Topics • JIP budget based on 10 Participants • If Participants prefer to change some of the topics, this can be done by unanimous approval of all Participants • If more than 10 Participants join: • money can be refunded per share to other Participants • more topics can be added as agreed by the Participants • Possible other topics for inclusion as JIP topics • Brownfield Upgrades While Operating • Benefits and Extent of Pre-FEED and FEED for FPSO Projects PAGE 42 © Endeavor Management. All Rights Reserved. www. endeavoreag. com

PAGE 43 Day 03, Thursday, September 1, 2016 Session VII: FPSO Best Practices Panel

THANK YOU Bruce Crager bcrager@endeavormgmt. com Clive Vaughan cvaughan@endeavormgmt. com Jeff Dice jdice@endeavormgmt. com Contact www. endeavoreag. com 800 -846 -4051 950 Echo Lane, Suite 200, Houston, TX 77024 info@endeavormgmt. com @Endeavor. Mgmt www. linkedin. com/endeavormgmt