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ALLOCATION MECHANISM FOR THIRD PARTY ACCESS TO THE ; SUNRISE ENERGY LPG IMPORT TERMINAL IN SALDANHA BAY

Sunrise Energy (Pty) Ltd

(Company Registration Number: 2005/027952/07)

PHASE 1: Loading and Storage Facilities in Saldanha Bay, Western Cape, South Africa.

• Construction License Number: PPL.sf.Fi/88/2009 • Operating License Number: PPL.sf.IF.F3/201/2015

Submission Date: 01 FebruarY 2018

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Table of Contents ACRONYMS ........... ... ... ............... ................. ............... ...... ....... .. ..... ............. ................. .. ......... .. .. ... .... ..... ............... 1

1. Introduction .... .. .... .... ... ..................... ................... .... ....... ........................... ................ ...... ..... ........................... 2

2. Tariff Schedule ............. ............ .................. ...... .. ... ... ........ ............................. ............ ... ................................. .. 4

3. Confidentiality ............................... ... ....... ... ...... .. .... . : .......... ... ............................ .... .... ............. ... ...................... 4

4. Adherence to Applicable Laws and Rules ...... ...... ...... ....... ......................... .............. .. .. ....... ............................ 5

5. Contractual Terms and Conditions of Use .......... ........ .... .. ......... ...................................................................... 5

5.1. Uncommitted Capacity ....................... ..... ... ..................... .. .... .... .. ................................ ..................... ...... 5

5.2. Capacity Scheduling and Planning .............. .. .. ...... .. .. .. ............. .......................... ....................... ............ 5

5.2.1. Initial notification ......................... .. .................... .................................. ....... .. .................................. 6

5.2.2. Ship Delivery Orders ........................... ...... ... ............................................. .................................... 6

5.2.3. Batching of Storage Vessels (Bullets) .......................................... .... ...... ........ ....... ........................ 6

5.2.4. Allocation Orders ........................ .... ...................... .. , ............................ : ...... .... ............... .... .... ... ..... 7

5.2.5. Road Dispatch Orders ... ..... ..... ... ... .... .... ... ..... .. .. ............... .... .......... .. .... .......... .... ........................... 7

5.3. Capacity of the Bullets .... ... ................. .. ........ ........ .................................................................... ............. 8

5.3.1. Metering .... .. ............... ................... , .................................... .. ....................................... ........ .... ...... 8

5.3.2. ·Quantity Dispute ......................... : .. .. ...... .. .. ......... ...... ........................ .... ...... ..... .............................. 8

5.4. Product Type and Quality Control ..... ...... .... ......................... .. ........................ .. .... ...... ............................ 8

5.4.1. Minimum Standards .......................... .. .. ......... ............................................................... .. .............. 8

5.4.2. Sampling Methods and Testing ..................................... ............. .. ................................................. 8

5.4.3. Slops Management .. ........................... .... ........ .... ................. ..... .................. ........... ....................... 9

5.5. Control and Care Transfer ...... ... ... ..... .................................. ....... ........................ ...... ................. ............ 9

5.5. 1. Entry/Exit Points and Allocation of Risks , ................................. .. ................................................... 9

5.5.2. Authenticity Verification .......... ......... ............... .... ..................................................... ........ .............. 9

5.5.3. Loss or Deterioration in Product Quality .... ................. ..................... .... .. .................... ......... .. ......... 9

5.6. Amendments to Documentation ........................................................ ............. ..... .. .. .......... .. .................. 1 0

6. Contractual Terms and Payment Conditions ...................................................... .. .... .......... .............. ............. 1 0

6.1. General ............................................................... ....................................................... ........................... 10

6.1.1. Invoice Format... ....... ....... ............ .................... .. .. ..... .. .... ... ..................... .. ........................... ......... 1 0

6.1.2. Timing of Invoice !ssuance ........................................... ... ... ......... .... ..... , ............ ........................... 10

6.1 .3. Date of Payment.. .......... .. ....... .. ........ .. .... ..................... ......... .. .......... .... ..... ....... .............. .. ............ 1 0

6.1.4. Method of Payment ............................... ......................... .................. .. .... .... .. ...... ......... ................. 1 0

6.2. Insurance Cover, Liability and Other Costs .................................................................. ......................... 1 0

6.3. Contract Default Mechanism ..................... .. ... .......... .......... .' ........... .... .................... .. ............................. 11

7. Technical Requirements for Access to the Storage Facility ...................................... .' .................................... 11

8. Process for Requesting Third Party Access .................. ..... .. .. ........................... .. ...... .................. ....... ............ 12

APPENDIX: Saldanha Bay MBM Information & Q88 Checklist ........................................ : .. .. ......... .. .. .. ........ .......... 14

Table 1 : Sunrise Energy Intake/Discharge Modes and Maximum Rates ... ........................ ............................................ 2

Table 2: Sunrise Energy Tariff Schedules* ........................................................... : ............... ..... ....... ................... ............... 4

Table 3 : Coupling Standard ......................................... ..... ............................................................. ..................................... 11

Figure '1 : Sunrise Energy Schematic Product Flow Scheme ...... ... .................................................................. ....... 3

ACRONYMS

B-BBEE

CPI

DCS

DOE

DTI

EFT

ERP

ETA

HSEQ

IDC

LPG

MBM

MOGS

NERSA

SARS

TMS

TNPA

VAT

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Broad-Based Black Economic Empowerment

Consumer Price Index

Data and Communication Server

Department of Energy

Department of Trade and Industry

Electronic Fund Transfer

Enterprise Resource Planning I Emergency Response Plan

Estimated Time of Arrival

Health, Safety, Environmental and Quality

Industrial Development Corporation

Liquefied Petroleum Gas

Multi-Buoy Mooring

Mining Oil and Gas Services

National Energy Regulator of South Africa

South African Revenue Service

Terminal Management System

Transnet National Ports Authority

Value Added Tax

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1. Introduction

This document sets out the Sunrise Energy (Pty) Ltd (hereinafter referred to as 'Sunrise Energy' or 'the Licensee') allocation mechanism as required by the Regulations published under. GNR 342 Government Gazette No. 30905 of 4 April 2008 in terms of the Petroleum Pipelines Act, 2003 (Act No. 60 of 2003) and its operating licence. It has been compiled in accordance with the National Energy Regulator of South Africa (NERSA) Allocation Mechanism Guidelines for Third Party Access to Petroleum Storage Facilities (dd. 26 November 2009).

Sunrise Energy operates a 25-year licensed liquefied petroleum gas (LPG) Import Terminal in Saldanha Bay, Western Cape. The Terminal allows for the loading, offloading and storage of LPG, Propane and Butane.

Sunrise Energy is 60% owned by MOGS Oil and Gas Services (MOGS), 31% by the Industrial Development Corporation (IDC) and 9% by llitha Group Holdings. The Terminal is a Level 1 contributor to B-BBEE (latest certificate available on request).

The Terminal is in commercial operation from May 2017. The project is designed in a modular way to respond to growth in the South African LPG market demand. A second and third phases are expected to be developed at a later stage.

Phase 1, to which this manual relates, consists of the following:

A Storage Facility

• Five cylindrical bullets (horizontal tanks) each with an operational storage capacity of 1,100 tons and a throughput capacity of 3,300 tons per month, total throughput of 16,500 tons per month

• Three road tanker loading gantries

A Loading (Discharge) Facility

• A floating multi-buoy mooring (MBM) anchored in the Saldanha Bay harbour at approximately 33°01 '55" S 1 r59'35" E

• A 12-inch diameter approximately 3.2 km long undersea pipeline, from the MBM to reach land at approximately 33°00'24" S 18°00'34" E

• A 12-inch diameter approximately 2.1 km long pipeline buried on land from approximately 33°00'24" S 18°00'34" E to the onshore storage facility referred to above

TABLE 1 :SUNRISE ENERGY INTAKE/DISCHARGE MODES AND MAXIMUM RATES

Propane 550 80

Source: Sunrise Energy

The "Client" is Sunrise Energy's direct client or the importer of the product, also known as the Product Owner or Aggregator. The "Customer" is the person or company buying product from the Client.

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The Terminal is designed to maximise throughput.

The throughput capacities are negotiated based on the market requirements.

The products to be stored and dispatched during the throughput process will be offloaded from vessels via the MBM loading (discharge) facility located in Saldanha Bay. The vessels must meet the minimum requirements as per the attached MBM checklist. While connected to the MBM, a ship is anchored in approximately 10.4-metre deep water and tied to and held in position by four buoys at the bow and at the stern of the ship.

The pipelines are capable of handling flow rates of 550 m3 per hour for Propane and LPG at a minimum/maximum pressure of 14/17 bar and at a minimum/maximum temperature of oo I 40° Celsius.

Over land, LPG and Propane can be loaded out of the storage facility using:

• Road loading gantry (3 loading bays in phase 1, up to 6 bays in phase 3) at the nominal loading rate of 80 m3/hour, which can be upgraded to 138 m3/hour

• Future development- Rail loading, configuration to be determined based on market requirements

• Future development - Direct pipeline to local industry or third party users at 220 m3/hour (as required with or without vapour return)

FIGURE 1 : SUNRISE ENERGY SCHEMATIC PRODUCT F LOW SCHEME

.Toll!! Cop""ky iJf LPG BullEts •1G 5110 ion Total Tbrcmghplll Copaclty ~52 000 ton!month .R;tllloadiii•Ganlrie~ (future)

LPG Bonet• Plutse 115 soo ton•!

Roa<Uoadlns .Ganf!i••

~>ibl! fl: ~.----------U------*--1 ~ • UDdersea pipl!ina O•e~land pipeline

(3lt baysfbase 1, up to'6JI bays l'flast 3)

PUM (Piper"'• (appror. 1.2 iol>l (approi. 2.1 km) £nd Manifold)

lPG Cylinder Filins fadlty·

Pro•lsion for pipetine to Sulk Consumers

Source: Sunrise Energy

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Clients may use the allocation mechanism set out in this document as a guideline for the allocation of LPG and Propane at the Sunrise Energy Terminal storage facility. The document stipulates the following:

• Tariff schedule • Confidentiality • Adherence to applicable laws and rules • Contractual terms and conditions for use of the facility • Contractual terms and conditions for payment • Technical requirements for access to the storage facility • Process to follow to request third party access

2. Tariff Schedule

The maximum 2016 base tariffs (1st March 2015-29 February 2016) approved by NERSA are the following:

• Marine loading facility = R994 per ton • Storage facility = R 1,181 per ton

This tariff is applicable for products being received by ship and dispatched by road. Additional costs will be charged for rail and pipeline dispatch when it becomes available.

The tariff is indexed annually from 1st March of the corresponding yea_r in line with the consumer price index (CPI) and in accordance with the formula below:

Tariff FYn =Tariff FYn-1 * KCPin

Where:

FYn = Financial Year for which the tariff is being determined.

FYn_1 = Financial Year prior to which the tariff is being determined.

KCPin = CPIIndex value for the month before the last month of FYn-l divided by the CPI index a year prior to that month.

TABLE 2 : SUNRISE ENERGY TARIFF SCHEDULES* _

2017 01/03/2016-28/02/2017 1,055 1,254

2018 01/03/2017-28/02/2018 1,125 1,336

Source: Sunrise Energy, NERSA, CPIIndex: http://www.statssa.qov.za/publications/P0141/CPIHistorv.pdf

*All tariffs exclude VAT.

3. Confidentiality

The planning I nomination processes and operations, information of the Sunrise Energy Import Terminal and it's customers is deemed to be confidential. Accordingly, no Party may disclose

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confidential information pertaining to another Party, without written consent of the owner of the confidential information. Confidential information shall include, but not be limited to the details of Agreements between the third party and Sunrise Energy, the information handed over during the course of negotiations, as well as the details of planning volumes, operating procedures, and so forth.

4. Adherence to Applicable Laws and Rules

The third party warrants that it is and will always be in compliance with all laws and policies applicable to the distribution and handling of LPG products, including, but not limited to, all South African Revenue Service (SARS), Department of Energy (DoE), NERSA and Department of Trade and Industry (DTI) requirements.

The agreements are also subject to the terms and conditions of the Terminal Operators Agreement between Sunrise Energy and Transnet National Ports Authority (TNPA) as specified by the Ports Act.

The third party must at all times adhere to Sunrise Energy's site Health, Safety, Environmental and Quality (HSEQ) rules.

In addition, the third party indemnifies and holds harmless Sunrise Energy to any claims arising out of such non-compliance.

5. Contractual Terms and Conditions of Use 5.1. Uncommitted Capacity

The word 'uncommitted capacity' means capacity determined by the Energy Regulator that is not required to meet contractual obligations.

Uncommitted capacity in the context of this document refers to the 'throughput capacity'.

The allocation rule principle for any uncommitted capacity will be the following:

• 'First come, first serve' principle: The first party to enquire regarding uncommitted capacity will be granted the first option to such capacity, provided that existing customers have had the opportunity to exercise their right of first refusal for their contracted capacity.

• 'Use-it-or-lose-it' principle: Should a client consistently not utilise committed capacity in accordance with the contractual agreement between Sunrise Energy and the client, Sunrise Energy will, after consultation with the Client, and by mutual agreement and in accordance with the conditions specified in the Commercial Agreement, be authorised to allocate the unused capacity to third parties who have requested additional capacity.

Applications for unallocated capacity must be commercially, operationally and technically feasible. Strict adherence to Sunrise Energy's safety rules, regulations and procedures will be required and failure to adhere thereto may result in the refusal of further operations for the relevant third party and cancellation of the contract, if already in place.

Sunrise Energy will not discriminate between customers or classes of customers in accordance with section 21 of the Petroleum Pipelines Act, 2003 (Act No. 60 of 2003).

5.2. Capacity Schedul~ng and Planning

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After the necessary contractual arrangements have been put in place, the following process should be followed regarding the planning and scheduling of the utilisation of additional uncommitted capacity at the Sunrise Energy Import Terminal.

5.2.1. Initial notification

Twenty days prior to the delivery date, a Client shall provide Sunrise Energy with:

• A three-day delivery range to be narrowed to a two-day range from the first day of the· vessel's time of arrival at the MBM

• provision of the ship Q88, • The quality and quantity of the products to be delivered • The plan to remove the product from the bullet within 1 0 (ten) days, in the event of the

throughput contract

Clients shall provide Sunrise Energy with full instructions in writing at least 15 (fifteen) days prior to the first day of the delivery slot to allow Sunrise Energy to prepare for the operation and for the preparation of the necessary documentation.

5.2.2. Ship Delivery Orders

The delivery of a shipment will be confirmed with at least 1 0 (ten) business days in advance of the three-day delivery range, by provision of the name of the Client's nominated ship, a valid certificate of origin, the expected date of the ship's arrival in port and the quality and estimated volume of the product to be delivered. Sunrise Energy shall review the information provided and confirm the order with the Client. The Order Quantity will be provisional only and the actual quantity offloaded will depend on the ullage available as per the contracted capacity at the time that the ship arrives in Saldanha Bay.

Prior to offloading, the quantity and quality of the product on the ship will be verified by the Independent Surveyor/Inspection company. The product will only be offloaded if it meets the SANS 1774 specifications, the ullage available and Sunrise Energy requirements.

During ship offloading, several samples of the offloaded product will be taken (via the sample point located on the import pipeline, upstream of the storage vessel inlet manifold). The quality information from the most representative samples will be averaged and a Certificate of Analysis will be produced by the Independent Surveyor/Inspection company who will operate the on­site Laboratory on an independent basis, for the product offloaded.

On completion of ship offloading, the quantity of the product delivered will be certified by the Independent Surveyor/Inspection company. Several sources of measurement will be used to determine the Offloaded Quantity, including:

• Mass measurement (primary source) • Vessel inventory calculations • Surveyor/ship readings

The agreed Offloaded Quantity (as well as the Quality) will be recorded in the ERP system as a Lot. A Ship Delivery Confirmation Report will be issued to the Client as a record of the ship offloading transaction.

5.2.3. Batching of Storage Vessels (Buffets)

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Batching refers to the process of verifying that the contents of a storage vessel ("bullet") complies with the applicable quality and other technical requirements and is ready to be dispatched from Sunrise facility. In order to batch a storage vessel, the vessel will be circulated and a sample of the content will be taken and analysed by the Laboratory Technician (via the sample point downstream of the Vessel Transfer Pump). The Laboratory Technician will produce a Certificate of Analysis of the vessel contents, reporting the physical properties against the SANS specifications. ·

Once a Certificate of Analysis is obtained, the vessel will be recorded as "Batched" in the Terminal Management System {TMS). The Batched Vessel will be tagged on the Data and Communication Server (DCS) as such. Any dispatch of product from the Sunrise facility must be from a Batched Vessel so that a Quality Certificate can be associated with the product.

5.2.4. Allocation Orders

Clients who sell product to their customers shall issue allocation orders to Sunrise Energy, which shall enable Sunrise Energy to assign client stock ("allocation quantity") to various customers or transfer stock between customers in the Sunrise ERP. This will not result in a financial transaction in the Sunrise system.

The Sunrise ERP System will validate that the allocation quantity is less than the total stock available to the client on the day of the order.

5.2.5. Road Dispatch Orders

Road dispatch orders are applicable to the dispatch of product via road tankers and may be received directly from the customer or via the Client. The order will only be accepted by Sunrise Energy if the customer has sufficient allocated quantity available.

Road dispatches must be scheduled three days ·in advance. Unscheduled road dispatches can be accommodated on the day only if there is capacity to do so and after planned orders have been fulfilled.

The Sunrise Operations Planner will confirm the requested date of dispatch in accordance with the Dispatch Order based on operations planning, including the availability of a Batched Vessel for the dispatch of the appropriate product and the number of Tankers that can be accommodated on a specific day. Customers will be requested to indicate the time of arrival of the Road Tanker. In the initial eleven (11) months of operation, where only LPG mix will be handled by the Terminal, Tankers will be queued at the facility as per the agreed truck schedule. Once there is a requirement to load other products (i.e. Propane), time slots will be allocated in the agreed truck schedule.

Customer Dispatch Orders cannot be processed or accepted without prior verification of the Tankers (Tractor and Trailer), as well as the Drivers, that will be used to transport the product. To this end, the Customer must ensure that their nominated carriers have registered their Tankers and Drivers on the Sunrise Energy database. This will include the provision of all valid documentation, licences and safety certificates specified by Sunrise Energy, as well as the tare weights of the tankers, tank volumes and gross vehicle weights.

If a Tanker does not arrive on the scheduled day, the order will be cancelled and the customer will be required to place a new dispatch order for an alternative date.

Road Tankers will be loaded by weight (using weigh scale measurements). The allowable load quantity will automatically be calculated by the TMS, based on the tanker specification weights

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recorded in the Sunrise database. This will prevent overfilling of tankers or manual filling by means of tri-cock measurement.

The actual quantity loaded will be recorded by the TMS and the results sent to the ERP for inventory management.

. On completion of loading, the tanker driver will collect the final load paperwork from the gatehouse, which will include the Bill of Lading and Dangerous Good Declaration, including the product Quality Information.

5.3. Capacity of the Bullets

Phase 1 consists of a total volume of 5 X 1,1 00 ton bullets with an operational capacity of 5,500 tons.

All measurements are done in mass terms (e.g. kilograms, tons, and so forth).

5.3.1. Metering

Sunrise Energy utilises Coriolis (Mass) Meters for custody metering of the product offloaded from the ship into the receiving bullets. When product is received from the ship, this is used as the primary measurement, however the value. is checked and verified against the bullet inventory changes. An Independent Surveyor signs off on the agreed quantity offloaded from the ship.

For Road Dispatch operations, the quantity of product dispatched is measured by means of Weighbridges. The empty weight of the road tanker is measured before and after loading, with the net quantity being equivalent to the quantity loaded and dispatched.

Certificates of calibration are available on request.

5.3.2. Quantity Dispute

Any losses below or equal to 0.5% are industry norms and will not be the liability of Sunrise Energy. Any losses above the 0.5% threshold must be proven and an auditing process will determine whose liability it is.

Please contact the Sunrise Energy for information on other types of liabilities.

5.4. Product Type and Quality Control

5.4.1. Minimum Standards

The facility will initially, for the first eleven (11) months, handle LPG only. Thereafter, it will accommodate Propane and Butane. All products must comply with SANS 1774:2016. In addition to the SANS specifications for LPG, Sunrise Energy requires that the Propane content of the LPG be between 60% (minimum) and 70% (maximum) by weight.

As explained above sampling and analysis will be required on vessel arrival. Should product not meet the specification, third parties/suppliers will be informed immediately. Remedial action plans will be negotiated. -

5.4.2. Sampling Methods and Testing

The following fixed sampling points are provided at the Terminal:

• On the import line- for the sampling of product transferred from the ship to the bullets.

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o Discharge of each transfer pump- bullets are circulated, sampled and tested and then batched if the physical properties meet SANS specifications.

A Technician from the Independent Surveyor/Inspection company will install the sample cylinders into the samplers and will witness all sampling. The Independent Surveyor/Inspection company operating the onsite laboratory will be responsible for testing the product sampled and will provide Sunrise Energy with a Certificate of Analysis to confirm that the product is within SANS specification limits.

5.4.3. Slops Management

No slops management is required for this type of product.

5.5. Control and Care Transfer 5. 5. 1. Entry/Exit Points and Allocation of Risks

Aggregators, Sunrise Energy's Clients, wiil consolidate orders from customers and accordingly bring in shipments of product to meet these orders .. The Aggregator/Ciient will then issue allocation orders to Sunrise based on their customers' orders. This means that Sunrise Energy will be able to allocate or assign product to customers based on instruction from its clients. Customers will only be able to receive LPG from the loading gantries if Sunrise Energy has received from the Aggregator/Ciient a valid allocation order for the customer.

The products shall be deemed to have been delivered by the Client to Sunrise Energy at the MBM:

.- Iimmediately upon the products passing the connecting flange of the pipeline at the MBM connected to the manifold of the ship.

The products shall be deemed to have been delivered by Sunrise Energy to the Customer at the gantry when the product passes the Sunrise Energy Terminal gantry flange connecting to the customer road truck.

From the point of delivery and until redeliverY of the products, Sunrise Energy will be responsible for rendering the services in terms of the LPG Handling and Throughput Agreement. Sunrise Energy shall not be liable or responsible for any services rendered to the customer by third party service providers or loss or damage caused to the products before the point of delivery and after redelivery of the products.

5.5.2. Authenticity Verification

Customers will nominate carrier companies to load and dispatch product on their behalf. Prior to picking up product from Sunrise Energy, Customers will inform Sunrise Energy of their carrier company details. Carrier companies will need to pre-register their tankers and drivers with Sunrise Energy, failing which they will not be allowed onto site. Sunrise Energy will verify the credentials, licences, and relevant certificates to ensure that the Tank~rs/Drivers comply with all relevant safety standards. Additionally, Drivers will need to undergo site-specific safety inductions.

Furthermore, Sunrise Energy will inspect all tankers prior to loading and will not allow loading to proceed if any safety concerns are identified.

5.5.3. Loss or Deterioration in Product Quality

The operating and maintenance procedures in place will ensure that no loss and deterioration of product occurs due to incorrect operations. These procedures will provide mitigations and ensure that equipment will always be maintained to ensure normal operating conditions.

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Security and fire safety proceedings must be complied with at all times.

5.6. Amendments to Documentation

The word 'amendments' means changes to documentation of a planned delivery or changes to documentation after a delivery to a storage facility.

If there is an amendment to documentation, procedures specific to the signed contract will be followed.

6. Contractual Terms and Payment Conditions 6.1. General

6.1.1. Invoice Format

The invoice from Sunrise Energy will contain the following information, where applicable:

• Contracting party name & address • Date of invoice • Applicable invoice period • Quantity of LPG (take-or-pay), Propane and/or Butane in kilograms (kg) - handled by

Sunrise Energy during applicable invoicing period • Throughput • Applicable tariff in R/kg • Sub-total amount in Rands, excluding 14% VAT • 14% VAT amount • Total amount including 14% VAT

6.1.2. Timing of Invoice Issuance

On the 1st day of every month.

6.1.3. Date of Payment

Payment will be due as per negotiated terms and conditions stated in the specific Contract Agreements.

6. 1.4. Method of Payment

All payments to Sunrise Energy must be made by electronic fund transfer (EFT) into Sunrise Energy bank account.

The third party shall use the customer account number allocated by Sunrise Energy to the Applicant as the reference for such payment.

Other terms and conditions (such as upfront payment, deposit or other terms of payment) will be as per agreed negotiated terms and conditions at the time of contract signature.

6.2. Insurance Cover, Liability and Other Costs

Insurance cover for the product will be the responsibility of the Client whilst the product is in the custody of Sunrise Energy.

The Clients and Sunrise Energy shall not during the currency of their agreement nor after its termination hold either party liable for any loss, damage or injury sustained by the other or its agents, servants, employees or independent contractors, except where otherwise provided in

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the agreement, or where such loss, damage or injury results from the gross negligence or intentional act or omission of that party.

Neither third party seeking storage nor Sunrise Energy shall be liable for any indirect or consequential loss or damage (including but not limited to loss of production, loss of revenue, loss of profits, loss of customers, loss of contracts, and Joss of custom, goodwill and/or reputation) suffered by the other party.

All additional costs will be for the account of the client seeking storage:

• Training costs i.e. all training required • Sampling, testing and analysis costs • Costs incidental to the negotiations, preparations and execution of the service

agreement • All agreed installation costs associated with increased storage capacity, should third

parties request increased storage.

6.3. Contract Default Mechanism

If the third party has made no payment for outstanding debt or no alternative arrangements are made within three (3) working days after notification by the Licensee, the acceptance and delivery of product will be suspended.

The Licensee shall inform the third party both telephonically and in writing of the suspension of operations and that no dispatch orders can be processed.

Should a third party wish to re-activate th.eir suspended account they must make a payment directly into Sunrise Energy's bank account and fax or email through a remittance advice.

Once the payment has been verified the third party is tore-perform the 'Know Your Customer' process.

7. Technical Requirements for Access to the Storage Facility

As per clause 5.5.2, Tankers must be compliant and pre-registered with Sunrise Energy prior to entry to site.

For safety reasons, Sunrise Energy has implemented the following coupling standard on site for the loading (and offloading) of road tankers:

TABLE 3: COUPLING STANDARD

Source: Sunrise Energy

Dry-Disconnect

BS EN 13175:2014 or equivalent

Vapour: DN50 {2")- male on tanker and female on loading arms/hoses

Liquid: DN80 {3") -male on tanker and female on loading arms/hoses

NPT {threaded) or flanged

Tankers loading product at Sunrise Energy on an ongoing basis are encouraged to convert their liquid loading and vapour connections to meet the above specification as soon as possible.

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There are three road loading bays on site. Two of the three bays will be fitted with Dry­Disconnect couplings meeting the above standard. The third bay will, in the short term, allow for loading via the traditional EVER-TITE® couplings, under stringent safety measures put in place by Sunrise Energy.

Any product thatthe Client needs to be handled at the Sunrise Energy Import Terminal needs to be imported via ship. Sunrise Energy shall subject the vessels to its own vetting procedures, as stipulated in Annexure B of the LPG Handling and Throughput Agreement.

The following section stipulates the technical requirements for access to the Storage Facility and dispatch by road:

a) All vehicles to obtain a Safe Loading Pass prior to Entry/Loading/Discharging on site, valid for a period of 12 months

b) All drivers must be inducted and trained on site specific safety rules and regulations: > General site induction > Emergency Response Plan (ERP) training > Basic fire fighting training > LPG properties and handling training > Transfer processes and procedures > HSSE practices in product handling and control > Control of Electrostatic discharges .> Road transport related policies i.e. drug and alcohol policy, seatbelt policy, cell

phone policy c) Safe discharge and loading procedures must be followed at all times

All drivers must be in possession of the following Licenses/Certificates:

> Valid Code 14 Dangerous Goods driver's license > Copy of Valid Medical Fitness Certificate to be presented to Field Operations

Manager with on first Discharge/Loading > Valid PDP

Any vehicle entering Sunrise Energy's facilities is required to adhere to the National Road Traffic Act (1996) and Regulations, particularly with reference to carriers of hazardous goods.

Any vehicles entering Sunrise Energy facilities are required to sign in on entry. Such signature may include any relevant indemnities.

Technical requirements for dispatch by rail or pipeline will be develop~d in a future phase.

8. Process for Requesting Third Party Access

All applications for LPG and Propane uncommitted capacity allocation shall be addressed in writing to the Commercial Director of Sunrise Energy, Mr. Arthur Martin:

• Phone: +27 21 913 7000 • Address:

Ground Floor Vineyards Square North Vineyards Office Estate 99 Jip de Jager Drive. Bellville 7530

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Applications should include the following:

• Full name, registration number and contact details of the company • LPG and Propane quantity to be imported and handled in tons and the intended time

periods of throughput (i.e. start and end dates- DD/MMNYYY) • State prospective vessel name and estimated time of arrival (ETA) • Intended method of dispatch with respective quantities (road only) o The applicant must also provide confirmation of their capacity to procure, handle and

distribute LPG products and must comply with, but not limited to, the following criteria: o Applicants must be registered as Wholesalers of Petroleum Products as set out

in the Petroleum Products Act, 1977 (Act No.120 of 1977) (as amended). o Applicants must be in a position to prove financial stability and Sunrise Energy reserves

the right to verify the details provided.

Should Sunrise Energy be in a position to accommodate the request, the potential customer shall be notified within fifteen (15) working days of receipt of the request. The potential customer will then be requested to complete a 'Know Your Customer' Form, and conclude a Commercial Agreement on the terms and conditions as specified by Sunrise Energy. The 'Know Your Customer' Form and Commercial Agreement shall be supplied by the General Manager- Commercial.

Existing Clients have the right of first refusal. Currently, there is no uncommitted capacity. Should prospects of any uncommitted capacity arise, Sunrise Energy will approach the market and seek Clients prepared to make long-term commitments. Details of those arrangements will be negotiated at the time and cannot be foreseen.

13

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APPENDIX: Saldanha Bay MBM Information & Q88 Checklist

h l 3

S~ktlntta Bay MBM Information & QB8 Cl:lee~list

SAlDANHA BAY MBM INFORMATION~ REQUIREMENTS, RESTRICTIONS & QS8

CHECKLIST

SUNRISE EN.ERG¥ - SALDANHA BAY MBM TE.RMINAL QUESTIO,NAlRE

Nominated LPG T~nker I The auachad questionnaire $hall accorr~pany each v~e-l nominatkm. and Shall be completed fn full by the Master.

Mast~, Owners and Chatlefi;i!i'$ at~ 10 oonllrm !hal lhE:Y have taken th~e po!nl$ lntt) (:Qil$~on !n ~ ptep~fiing of mQQring and et;tg(l opera.tlx'lns

~um tOA aii'Qwed I$ approximately 174 rnel!e$..

Minimum LOA allowed Is 97 metres $lll;rj~t to Pircrs df,scretton.

Cargo and Balfast Handling

The S\lnrlse Entl!rgy MBM facll!tY is de$fgned nomiilally f(lr a ma:iim~m 35,000 m¢ d~lgn~ SUIIl1met Dl$pf.$cement. Sa.ldanha Bay MBM max dept!\ 1$ 13.0 mwes Chart Da.!Um­~om draft W 'lle$$el 10.4 me~rl"ls·

The vessel Is b) main:taln at au times, a mln.lmum ol 25%. of SDWT on boa:rd ~s cargo or ballast.

. While moored at the MBM, the vessel's trim fs not tn ~ceed 3.5 metr>$$. During adVl;ltSe we$let the Discllat~ AdVisor may r~urt~ thE! ~sseloo nave less trim.

What is1he maximum and normal opera~tng dlsdlarge pressure at lhe ~ip's m~n!fold: What Is the maximum dl$charg.e pressure in terms of the De11:ponent I Owners H~ Charter Party:

E$timated !lme r¢qulred for sflippf:ng operatiClns an oomp!e!ion of bt:Jik d ischarge.

Discharging will be through one $Ubmarfne hose Siring with 1he fo!l.owJ.ng restr)(:l:[(lns: Maximum discharging rate ls 714 cllbic mwe-s per Mlir. Average dlscltarge rate ls approximately 550 c:ubie metres: per hour$tlbject to malntelning a m!nimum CJf 14 B:ar at lhe rrnmi[Q.ld.

Ched<~ - Yes I Nl;> :by lhe Master prltll' lP and the Di$Charge AdvisOr <ii'l rece!ptof the nomlnatl<'ln Mas~ 088 Ref DA

1.

1.4 8.18

1.21

2.

5.

5:10

5.14 etc

14

P25

flaJdanha Bay MBM lnfor,malion & Q88 Cheekli$1

VeSS(ll must comply with OCIMF reccmme:ndatioo:sln respe:ct of .adequatef!J'I~ pads, bi!.\'S cr ltlimllar fae~i!i~ ~t omear the m;('!l'ilf<tld t'O enable '!he cargo h~{$} lo be twng off prQpetly by !tl'll;l.ans of hanging-off chalns. Reference: OCIMP ReoommendatiQns IQr 011 TankersAtsiX>liated !:f;Juipment, fQllfth Edition 1991; ~n 6 - ~ck Flttling$.

D1stance from rail lQ manif.ol(lto be mtrrimum 4. m.e.tres. OCIMF r~mtl'l!;ln(lat!Q;n 4.5 me~$ f-Qf SP:M (!Jlei'<ltiQI'l$.

LfJG line~ 1 x 8 inch hQse string and 12 inch plp;lline to shore~ a inch oonnectiQn. The m~irold c('Jnf:il1ictlcns. must be ~pable of a~pllng an S.", ASME 3Q(!Ib 4 c.:~ !!itUddoo Qam.lo~ CPupUng.

Forward: Vessels w be· ~quipped wilh two anchPf Y.lil'ldlasses · capOOie of wQddng lndependenlly d cne another. V-e$$~S ¢0 ~

equrppoo wilh4 x 220m x 64mm JXtEypi'Qpyl~ne mooring H'tfllil$ (or Dynema. elo. equlvafenl) wl1h MBL of approxlm~t.ely 63mt = .2 per moormg l:luoy {~~' Aft: Ther~ mtist b(l $1;1rtlclent wind-les art ~o make fast 4 Bne$ from the $T~m <Jf 'lh~ vessiilt V~$$el$ to be equipped with 4 x :22Qm x 6'4mm p:Qiypmpylene filiOQrll'lg! rope-s {Qr O)ln-ema. ete eql!.llvaleRI} \'ldth MBL of approxfmttt¢~y Gamt ~ 2 per mooring buoy t2)• All lines to be fla"Ked out and r~ady fQr US.e ~t .appropriate reads prior to pllot boardir:Ig. flooring wt'es are not $uilabfe tor MBM operaUon~

Minimum etan~ capae~y on the port side manifold - SWl 5 tonnes.

INFORMATION

,.. .AM SOL>

5.30

5.36

7.

7.5 7.3

7.21

~tAN IUAIIHE 5Cit.VnQNS

Tanker's office!$ and crew irdlooated dOil$S tor i$PS,.t;er!hing & mooring, (:{ana opel";ltiO~, lfl:;flkfng r~ MJS {tug's tines) artd unmooring. Pllot l~r rfgg~ on port & stbd s~ wllh $1.lltab!~ mal'rila man ropes (as p~r SOLAS & TNPA ~!11alions). Comblna\lon ladder If applioa.bi<L

Only dayHgh~ mooring is ](~Efrmllte\L MQoling $haD not c;Qmmenr::e l~<tter ·ut~an 2.5 hour;; prfl)r to SUil$et. taler lfll)Qrlng wiD be $1Jbject to Pl!Qt's diSCJ'etlbn. Only dayDght unmooring is p(lrmittad. Unmooring shall not comment::e e.arfl~'#"than 0.5 hoiJrs p r1or lQ $t,mrf$e or later than 1 hoor prrono sun$~t. later unmooring will be stll;Jject to Pil~;Jl's di!1lcrellon.

EnvlrQnmenta! nmlt.!l!llons: fQr moorlng: Wlnd .speed 14 m/$ "' 2.7 Kll(lt$ Wav;:; height 1 •. 5 m

Wavrt) per!Qd 12 $eOOnd$

15

P26

Saldanha Bay MBM tnfOi"tr''l!dion & oaa Checklist

Total LPG l!n~ fenglh .1$ ~pproximal~ly 5400 :ll'li;lllfi;J$ (3200 m si:lb$ea. 2100 m onshore, 98 m P.LEM and S~Jbmarln& hose $tt'lng). Mooring , PLEM - M.atket to be 35m aU ~~nd 30 to 35 m to port of rn~l'llfo!d

Mfixlmum .$hUtdown pres$ure - [ ... PSI I( •••• : Bar)]. mnnlmum ®hora valv~$hUtdt:lWn time 1$ 30$(l~nd$.

Trn:re are no fresh wat~r facillttie$ a! the Saldanh-a Bay MBM.

The ~ssel mu$:t providle fO('ld accommods.Uon for at least 8 shore personnel for the du.:ration that lhe vess~ wiD be maored at the .MBM- Dl$charge Advisor, Sur'lteyor, Tanker Team. TNPA Berthlng Team

9.$ INFORMATION REQUIRED FROM SKIP~

That the v~el compile$ with ii.U reqorr.emJ;Jn!:$.

Tt\EJ qti<mllty c~ ~go and/or balli!!St on heard. Which !~nl<s are avallabfe for disei:Iarglng. The arriVal draft and esMmaled sailing draft

The calcula!ad arrival and departure s!abnhty data.

Ma$ter I$ lO QO.M'Ifm he WDI i:Otnply with SOUth Afr1~n ISP$ Pre-arrival prooedtm;;e In aooord~rtee with SAMSA regula~nns.- See SAMSA Merlne Notice No. 28 of 2016

Name and rank of SSO

Terminal S..:eurity lnfonnation

T~al Assls~nt Port Fa.dlfty Securit~ Dlscharg~ Adv1$ot omcer:

Det.aits of any d~rects, whk:h may ai,iversely· affect tl-lla· va~'$ ma;noouvrabmty, si.ab!Bty. lnb;lgrfty a.ndlor opera!Jona! s•ty. Oefic!enctes 'lh~t a;ri$e alter the QOO Is oomple~d moot be repl)~d 1.0 bQt'h Surwlse Efl~rgy and the Discharrge Adllf$Dr rmmediately

16

P27

Annexure 2: Sunrise Energy Allocation Mechanism Assessment Report

Storage Capacity Allocation Mechanism - Sunrise Energy Page 9 of9

ALLOCATION MECHANISM ASSESSMENT REPORT

Licensee Name: Sunrise Energy {Pty) Ltd

Date Allocation Mechanism Received: 1 February 2018

Facilitlities Covered:

Name of Facility Saldanha Bay

Name of Assessor : Talulani Mapholi

Licence Number P PL. sf. If. F3/201/2015

Conclusions S,))M;/: f.o PP'S 6~r i'\oL::J ,

ANNEXURE 2

Allocation Mechanism were assessed for compliance with the relevant regulations and meet the requirements of regulations 3(8) and

3(9)

Signature Assesor :~ ~

Signature Acting HoD: Hf~L . Date: t2o M""l ~IR Date: '2.(., Apn'/ 'lotS .

Allocation Mechanism Sunrise Energy (Pty) Ltd Page 1 of2

"tt N (X)

Allocation Mechanism Assessment Findings

Regulatory Compliance Requirement

Regulation 3(8): a. the tariff schedule. An allocation mechanism contemplated in sub-regulation b. contractual terms and (6) must include - . conditions for use and

payment. c. technical requirements for

access to the storage facility.

d. processes to be followed by third parties when requesting access.

Regulation 3(9): An a. be commercially allocation mechanism reasonable. contemplated in sub-regulation b. be operationally (6) must-

reasonable.

c. apply on a first come, first serve principle.

d. apply a use-it-or-lose-it principle;

e. not discriminate on any grounds as contemplated in Section 21 1 of the Act.

f. be technically feasible. _

Allocation Mechanism Complies? (Yes/No) Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes ------

Comments (Applicable sections in the Allocation Mechanism document)

Section 2. Tariffs submitted and NERSA approved multi-year tariffs for storage and loading on 3 February 2016 Section 6

Sections 5 & 7. Includes marine loading checklists.

Sections 5, 6 & 8.

Sections 2, 4, 5, 6, 7 & 8. The commercial terms and conditions are similar to other Allocation Mechanisms noted to date. Sections 1, 4, 5, 7 & 8. Includes a description of the facility operations. Technically, access to the storage capacity can only take place via the marine loading facility (MBM). Specific reference in Section 5.1, p.5

Specific reference in Section 5.1 , p.5

Specific reference in Section 5.1 , p.5

Section 7

Allocation Mechanism Sunrise Energy (Pty) Ltd Page 2 of 2

"'tJ !'..)

co