project finance market report 2016

Market Report Shipping & Offshore

June 2016

PART I – THE MARKET 03 Prologue 07 The Project Environment 10 Offshore Freefall 14 The Oil Market 17 The Tanker Market 19 The Dry Market 21 Projects Established 24 Projects Sold 25 Current Projects 26 Projects Estimated Returns 27 Fleet List 2016

PART II – THE PROJECTS 29 Aberdeen Offshore DIS 30 Asian Bulkers DIS 31 Bergshav Aframax AS 32 Bukit Timah Offshore DIS 33 CIT Grieg 34 CIT Thor 35 Dongguan Chemical Tankers DIS 36 European Venture DIS

TABLE OF CONTENTS

37 Feeder Container Vessel DIS 38 Feeder Container II DIS 39 Golden Kamsar DIS 40 Henrietta Product DIS 41 High Yield Shipping DIS 42 Homborsund Container DIS 43 Industrial Shipping DIS 44 Lesley Product DIS 45 MS Nordstjernen DIS 46 Octavian Bulker DIS 47 Orchard Offshore DIS 48 Panda Chemical II DIS 49 Saragol Tankers 1 DIS 50 Saragol Tankers 2 DIS 51 Seminyak DIS 52 Sentosa Offshore DIS 53 Singapore Offshore DIS 54 Southern Chemical DIS 55 Sudong Offshore DIS 56 Vestland Marine Seismic DIS 57 Platou Shipinvest I DIS 59 Head Office & Contacts

Dear Investors and Business Associates, During our 12 years in business, the project finance market has never been more challenging. We are looking for segments within the shipping and offshore industry that are generating a return on the investment that will attract investors to place their equity. The question is; Do they exist at all today? The traditional sale/leaseback project with owners selling their second hand vessels to free up cash and expand their business is hard to find. We need a charter market that can generate a positive cashflow to the shipowner after deducting financial and operating costs. At the same time, the investors need to be comfortable with the counterparty risk and the residual value exposure at the end of the charter, unless there is a put option/purchase obligation with a bankable counterpart. Our original business model is very flexible. During our years in business, we have financed long term and medium term bareboat lease, long term, medium term and short term time charters in addition to newbuilding and second hand asset plays. The sources of funds have been a mix of equity and debt finance, ranging from highly leveraged deals (90%+) to 100% equity finance. There are no restrictions on type or age of the assets and the size of investment has varied from USD 1 million up to USD 150 million in a single project. In order to keep the fixed funding cost competitive, we have also introduced various models including profit split on earnings and future asset values. Our team of corporate managers establish the buying/owning company and keep the investors and banks well informed with financial accounts and project updates. We have a sales team that follow up the projects with a liquid second hand market for buying and selling shares in the existing projects. We also make use of our large in-house network of shipbrokers to source new deals and sell existing projects when the charter contracts expires. In addition, we have access to the worlds largest research databases and analysis within the shipping and offshore industry. If we briefly look into the different shipping and offshore segments today, we see these challenges and opportunities. Dry Bulk A shrinking orderbook, high scrapping levels, horrible charter market and historically low ship values. Any sale/leaseback structure will generate an operating loss to the charterer unless the vessels have been fixed on a long term time charter contract prior to the slowdown in 2014. Many dry bulk owners are restructuring their debt and the counter party risk is high. The timing for asset play investments financed with 100% equity or possibly a soft loan is likely to be good. A reduced net fleet growth will turn the market sooner rather than later.

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MARKET REPORT 2016 – CLARKSONS PLATOU PROJECT FINANCE

Prologue Tankers A positive spot market in the crude sector. However, difficult to find long term time charters at attractive levels. The second hand values for 5-15 year old vessels have dropped 20-25% during the last 6 months, creating “asset play” opportunities with a good cashflow in the short term. We are able to finance 80-90% of the asset value with long term bareboat charter at a low fixed bareboat rate with a profit split element. Container vessels Similar situation as we see in the dry bulk market. A charter market that just cover operating costs and second hand values 30-50% below newbuilding parity. A large orderbook in the ultra large segment creates more challenges to the liner operators, but a shrinking orderbook in the feeder segment could open up for “asset play” opportunities. Many shipping banks are still struggling with distressed container fleets but some deals with soft loan structures at high debt levels are possible to develop. The fresh cash injections are only covering highly needed working capital and although the risk is high, the return could be very attractive if the timing is right. Offshore Opportunities - yes, but is the timing right yet? Still a large orderbook, many vessels laid up, a modern fleet with low scrapping numbers, and a “dead” charter market. Many offshore owners are looking for new sources of funds and many opportunity funds are looking for distressed offshore deals. However, most of the financial challenges have so far been sorted out between the senior lenders/bond holders and the owners. We are the largest offshore broker in the world and we talk to all the players in the market. We have already been proposed some distressed vessels at very low prices and expect to present some “special opportunities” in the near future. Other shipping segments We look at all floating assets, including cruise, ferries, RORO, cement, car carriers and chemical tankers. These are seen as industrial shipping segments with less cyclical markets. We will continue to monitor all opportunities and hope to see more activity in the coming months. If you are a shipowner looking for a flexible funding structure or you are an investor looking for direct investments in the shipping and offshore industry, we hope to serve you both with good solutions that creates value for both parties. In the meantime, we wish you all a good summer vacation. Kind regards, Clarksons Platou Project Finance

CLARKSONS PLATOU PROJECT FINANCE Clarksons Platou Project Finance AS (former RS Platou Finans AS) has since its inception in 2004 become one of the world’s major project finance companies that specialize in shipping and offshore related financial schemes in the interest of both shipowners and financial investors. The main objective is to identify attractive investment opportunities, which involve the purchase of shipping and offshore related assets along with secured employment, as well as present asset play cases when the timing is optimal. The strength of Clarksons Platou Project Finance lies not only with the highly qualified staff, but also with the vast shipping related resources available within the Clarksons Platou Group. Clarksons Platou Project Finance is an independent company within the Clarksons Platou Group utilizing the full potential of having close contact with shipbrokers, shipowners, ship managers, bankers, lawyers and consultants worldwide. CLARKSONS PLATOU PROJECT SALES In late 2014, Clarksons Platou Project Finance established a new division designated to sourcing equity and increasing liquidity of project shares in the second hand market. The new focus on sales will allow us to further increase our project activity and deal size. The team consists of three brokers and a compliance officer. Increasing the liquidity in the second hand market will provide added value to our existing investors and opportunities for new investors to enter existing projects. CLARKSONS PLATOU INVESTOR SERVICES Clarksons Platou Investor Services AS is a wholly-owned subsidiary of Clarksons Platou Project Finance, and assists private investors with establishing companies and business management. The wide scope of services offered include establishment and incorporation of AS, KS, ANS and DIS, accounting, and tax documentation, remittance and secretarial assistance. Clarksons Platou Investor Services has close connections with numerous well-known and respected companies and establishments such as lawyers, banks and chartered accountants of whom these services can be utilized by investors if so wished. Customers of Clarksons Platou Investor Services will, as per other investors, have access to interesting investment projects as proposed by Clarksons Platou Project Sales. The investors will establish a personal business-relationship with the assigned accountant so that they can request prompt assistance.

CLARKSONS PLATOU REAL ESTATE Clarksons Platou Real Estate AS is one of the leading players within Norwegian real estate project finance. The company is a fully integrated real estate corporate finance house specialized in sourcing, structuring and facilitating commercial real estate. The company’s geographical focus is on the Norwegian and Swedish real estate market. The company’s core actives are: Origination of interesting financial estate

opportunities Structuring and restructuring of real estate projects Structuring of development and opportunistic

projects Project financing of real estate projects Corporate finance assisting within the commercial

sector Asset management

CLARKSONS PLATOU PROPERTY MANAGEMENT Clarksons Platou Property Management AS is a professional manager and developer of industrial and commercial real estate. The company offers highly qualified services within all types of management for sophisticated real estate investors, tenants and suppliers. The company’s main focus is to contribute to value creation for the investors and the property itself by being hands-on throughout the lifespan of the investment. The company’s core activities are: Technical management Tenant relationship management Letting and commercial management Corporate management and reporting Building operations and maintenance Real estate development

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CLARKSONS PLATOU PROJECT FINANCE

Project Sales

Project finance

Investor ser.

LARS GJERDE Head of Sales

STIAN SKAUG-PAULSEN Senior Broker

ANDREAS W. BANG Broker

AXEL MOLTZAU AAS Joint Managing Partner

CHRIS. W. SVENSSON Joint Managing Partner

TRULS WIESE KOLSTAD Project Broker

HÅKON FREDERIC RØSAKER Project Broker

TROND HAMRE Senior Partner

LARS GJØRVAD Head of Compliance

BENJAMIN RYENG-HANSEN Managing Director

HEIDI MEYER WESTBY Office manager

ERIK KRISTIAN ANDRESEN Corporate Manager

ELISABETH RELBO Secretary

EVA LISE BJERKE Corporate Manager

KRISTIN VOLLAN Managing Director

JULIE MELGAARD RANVIG Accountant


Disclaimer - Important Information The material and the information (including, without limitation, any future rates) contained herein (together, the "Information") are provided by Clarksons Platou AS ("Clarksons Platou") for general information purposes. The Information is based solely on publicly available information and is drawn from Clarksons Platou's database and other sources. Clarksons Platou advises that: (i) any Information extracted from Clarksons Platou's database is derived from estimates or subjective judgments; (ii) any Information extracted from the databases or information services of other maritime data collection agencies may differ from the Information extracted from Clarksons Platous' database; (iii ) whilst Clarksons Platou has taken reasonable care in the compilation of the Information and believes it to be accurate and correct, data compilation is subject to limited audit and validation procedures and may accordingly contain errors; (iv) the provision of the Information does not obviate any need to make appropriate further enquiries; (v) the provision of the Information is not an endorsement of any commercial policies and/or any conclusions by Clarksons Platou and its 'connected persons', and is not intended to recommend any decision by the recipient; (vi) shipping is a variable and cyclical business and any forecasting concerning it may not be accurate. The Information is provided on "as is" and “as available” basis. Clarksons Platou and its ‘connected persons’ make no representations or warranties of any kind, express or implied about the completeness, accuracy, reliability, suitability or availability with respect to the Information. Any reliance placed on such Information is therefore strictly at the recipient's own risk. The opinions and estimates contained herein represent the view and judgment as of the dates specified (and in absence of such, as of the date of the report), and are subject to change without notice. Delivery of this report shall not create any implication that Clarksons Platou assumes any obligation to update or correct the Information. This Information is confidential and is solely for the internal use of the recipient. Neither the whole nor any part of the Information may be disclosed to, or used or relied upon by, any other person or used for any other purpose without the prior written consent of Clarksons Platou. Especially, the information is not to be used in any document for the purposes of raising finance whether by way of debt or equity. All intellectual property rights are fully reserved by Clarksons Platou, its ‘connected persons’ and/or its licensors. To the extent permitted by law, Clarksons Platou and its ‘connected persons’ shall not be liable to the recipient or any third party for any loss, liability or damage, cost or expense including without limitation, direct, indirect, consequential loss or damage, any loss of profit, loss of use, loss of or interruption in business, loss of goodwill, loss of data arising out of, or in connection with, the use of and the reliance on the Information whether in contract, tort, negligence, bailment, breach of statutory duty or otherwise, even if foreseeable. These exclusions do not apply to the liability of Clarksons Platou and its ‘connected persons’ for fraud or fraudulent misrepresentation. In this disclaimer 'connected persons' means, in relation to Clarksons Platou, its ultimate holding company, subsidiaries and subsidiary undertakings of its ultimate holding company and the respective shareholders, directors, officers, employees and agents of each of them. This disclaimer shall be governed by and construed in accordance with Norwegian law.

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Offshore

Tankers

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Other

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Bareboat 90 %

Timecharter 10 %

Total Projects By Employment

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Project Finance: Flexible capital in a challenging market

Those who have followed the shipping industry for a while, know how much can happen over the course of a year. This is certainly true since our last report was published. Since then, we have seen the Baltic Dry Index fall to its lowest historical level since 1985, and we have seen the number of offshore vessels in layup increase to about 400(!) vessels worldwide. Currently, of all of the major commodity shipping segments, tankers seem to be the only segment that is able to generate a sufficent cashflow to cover both operating expenses and financial costs. Furthermore, the negative development in earnings and the decline in vessel values, has created a major problem for traditional shipping banks around the world. In additon to major restructurings and defaults on loans, the banks have more or less closed their doors for new business, with the exception of top-tier clients, and isloated projects with long timecharters. The absence of traditional bank finance in todays market has made new transactions more lengthy, uncertain and challenging. At the same time the reduced access to capital has led to few newbuildings being ordered, and more focus on second hand market transactions, where Greek, Norwegian and Chinese cash buyers have been very active.

On the positive side, with market conditions at the lowest levels seen in 15-30 years we see that there is a record number of vessels scrapped, which is likely to continue as owners are not able to operate vessels with a profit. The combination of increased scrapping and record low newbuilding activity will hopefully have a normalising effect on the balance of the shipping markets. Since Februrary this year we have seen the dry-bulk market bottom out and return to a level just around OPEX. In today's market, we see that the advantage of the Norwegian KS market/Project Finance, is that the equity can be more flexible and more creative than traditional debt finance. For example, recent developments shows that private equity is entering the market offering debt finance at slightly higher margins and with profit-sharing arrangements. This is an interesting development, and a much needed source of capital for shipowners in today's depressing market.


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This year we have seen that the Norwegian KS market has been less active than in 2014/2015. The reason for this has not been a lack of investor interest and equity available, but rather the challenge of finding attractive investment projects in a very poor market. A few containership projects have been placed in the Norwegian KS market, but other than this there has been little activity. While many have been trying to do drybulk projects, it has been difficult to purchase quality Japanese built vessels, as there are sometimes in excess of 20 cash-buyers waiting in line to inspect and make offers. Although the first half of 2016 has been a period of with low activity in the Project Finance market, we believe the second half of the year will be more active as we see an increase in dealflow and quality projects before the summer. Clarksons Platou Project Finance currently has Corporate Management on 21 shipping projects today. Of these 90% of the projects are on bareboat charter, while the remaining 10% are on timecharter. This is a diversified portfolio of crude & product tankers, chemical tankers, offshore and containerships.

We have completed/sold 7 shipping projects this year. Of the 7 project sold, 4 generated an IRR between 6-50% p.a. over the investment period. Given the current market situation, this is a very satisfactory performance. There are now 4 employees in the Clarksons Platou Project Sales working on primary and secondary sales of shares in new and existing projects. So far this year, we have seen an increase in number of transactions in the second hand market, and established a bi-monthly circulation of second hand market activity to inform investors of what is for sale and buying interest in the existing projects. The Project Sales Department has also worked on organizing shipping and offshore seminars for our investors during the course of the last year, and this is something we will continue to focus on going forward. We look forward to a more active project finance market in the second half of 2016 and hope that the shipping markets will improve over the summer.


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Summary KS-houses 2005 - 2015 (Fearnleys, NRP, Pareto, Clarksons Platou)

Total Project PriceTotal Paid in CapitalTotal Uncalled Capital

Overview The oil price has dropped significantly since the second half of 2014, after three years above USD 100/bbl. Oil companies were overspending even at USD ~100/bbl and were targeting spending cuts already late 2013/start of 2014, before the oil price started sliding. E&P-spending (topline for oil services) has traditionally trailed the oil price. E&P spending in 2015 declined 20-25%, and a further 5-15% is expected for 2016. Consensus seems to believe that 2017 will be the final year with cuts, and that it will flatten out before increasing again in 2018. Legacy projects (already committed spending) are likely to prevent spending from dropping even further in 2016. At the same time, nearly all oil services sectors have seen very high growth in supply over the last couple of years, and orderbooks are still substantial compared to the current fleet. Meeting decreasing demand, the oil services industry are likely to struggle over the next 24 months. Utilization for both the Rig, OSV and Subsea space is coming down, and is likely to drop further especially in 2016. This will mean a sharp rate fall for new contracts, for most sectors likely to be close to OPEX. Also, oil companies are pushing for rate reductions on already negotiated contracts, in some cases with prolonged duration as a reward. Both new and existing contracts might be linked/indexed to the oil price development going forward. To reach acceptable rate levels, i.e. utilisation levels, one would need to see substantial lay-up/scrapping in many segments. On a global basis, floater rig count was down 23%, and the jack-ups down 20% in 2015 (November-15 vs November-14), and this trend will likely continue through 2016.

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Offshore freefall, an analysis of the OSV market

International OSV demand The decreasing global offshore activity in 2015 led to OSV demand coming down, and combined with fleet growth led to lower utilisation and lower rates. The global OSV fleet is estimated to have grown by 5.7 % percent in 2015. A further breakdown shows the PSV fleet grew close to 9% and the AHTS 4-9,999 bhp fleet (cargo work being the mainstay of this type of vessels) increased by 2.7% percent in 2015. Day rates across the globe were sharply down, with the NSEA starting the decline in H2 2014. The North Sea PSV market has remained challenging for owners in 2015 and H1 2016, with spot rates ranging between GBP 2.294-10.374,-* for 499-900m2 deck PSVs, and between GBP 2,770,- 9,077,-* for 900m2 PSVs (weekly numbers high and low). Term rates have also come down for all categories, continuing the downward trend started in H2 2014. While the spot market has been trading at/below OPEX for some time, there are signs that bids for long term work in the North Sea are getting closer to OPEX as well. The market has also seen a very low contracting level through 2015, with the number of PSV years fixed at its lowest level since the aftermath of the financial crisis in 2009. This is clearly illustrative of a softening market, where charterers face low risk of tightening capacity, and rather prefer to fix vessels on shorter-term contracts or utilize the spot market. Therefore, the number of spot contracts has been relatively high.

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Global PSV average term rates

North Sea 500-749m2 West Africa 500-749m2 Brazil 500-750 m2


Utilization has been falling steadily since the middle of 2014. More than 80 PSV's have been laid up, and owners are increasingly willing to do so as demand outlook is still weak. We estimate PSV utilization to have decreased 26% in 2015, averaging 76% through the year. Large PSV's achieved a utilization rate of 85%, 11% down from 2014-levels, while medium-sized vessels decreased to 65% compared to 90% in 2014. The smaller vessels also achieved lower utilization, averaging 62% for the year, compared to 88% in 2014. The fleet increased with 12 vessels, or approximately 5%. The number of lay-ups is likely to increase, and in December 2015 approximately 1/3 of the fleet was in lay-up. As term contracts are at OPEX levels, and laid-up vessels are still bidding for long term contracts, we expect term rates to be flattish through 2016. Spot rates have been volatile lately, due to both the before mentioned lay-ups and at times harsher weather conditions. Term rates in the US Gulf of Mexico across the PSV vessel categories declined by an average of 39% across the year. Demand was driven by a decreasing demand as oil companies cut capex over the line. Floaters on contract rose in the US Gulf from 42 units on contract in 2014 to 41 units on contract in 2015. At the same time the Jones Act effectively blocked international vessels from entering US waters, thus limiting supply growth, as well as aggressive stacking from USowners. One market, which has seen demand coming down quite sharply, is Brazil, as both the corruption scandal and economic problems for Petrobras has led to many vessels coming off their contract. Also, the blockage of international tonnage on behalf of Brazilian flagged vessels, has led many international vessels to leave the Brazilian market, and increase supply in other regions. The floater rig count dropped by 24% in 2015, from 62 to 47 floaters. Term rates for PSV's were on average down 35%.

Overall, average day rates through the year were down sharply in most regions, but with slight regional variations. OSV demand growth falling With the steep fall in oil prices and heightened capital discipline focus amongst the oil and gas companies, we expect future demand growth for OSV's to come down significantly. Demand for OSV's is driven by production support, rig support and, to some extent, offshore and subsea construction support. Continuous production support is by far the most important driver for OSV's, whereas rig support is the main driver for the AHTS segment. Rig support is anticipated to drop, thus contributing negatively. Future OSV demand needs to see the rig count increasing All segments within the offshore space are affected by the major oil companies’ increased focus on preserving cash, and with the current oil price, a limited number of projects are sanctioned. The level of fixing activity for rigs has been at a low level for a couple of years. Therefore, the backlog of the rig companies are coming down. With more than 130 JU's and more than 70 floaters under construction, utilization levels will stay low for both segments. Also, the number of rigs on contract in absolute terms is coming down over the line. As one of the most important drivers for PSV demand, this will reflect on the demand for the OSV's for the next couple of years. With a low sanctioning level of new projects, demand from construction support will be limited as well. Therefore, the demand for OSV's caused by production support (historically 50% of the demand), will be even more important than earlier, as this is likely to see limited demand cuts unless the P&A activity kicks off.


The AHTS Market The North-Sea AHTS market (>10,000bhp) The North Sea AHTS market have remained challenging in 2015 and H1 2016, with spot rates typically ranging between GBP 3.850-63.505,-* for 16-19.999 BHP AHTS's, and between GBP 4,818,-66,500,-* for the largest class of AHTS's. The market for long term AHTS contracts, historically a very small market, has almost vanished this year. Term rates have also come down for all categories, continuing the downward trend started in H2 2014. The rates for this segment have also been close to OPEX for large periods throughout the year, but with more spikes than the PSV market. Utilization has come down from 71.6% to 54.8% for the medium class and from 70.8% to 53.8% for the larger vessels. More than 40 vessels have been laid-up. Usually, weather conditions have been highly important, leading to periods of unforeseen tightening of the market balance and coherent spot rate spikes. This year, the spikes have been fever, and shorter lasting. Tough times ahead Looking ahead, the North Sea AHTS market clearly appears challenging. A significant number of rigs have come off contract since H2 2015, and many more are scheduled to come off firm contracts both on the Norwegian and UK side of the North Sea through 2016. As for the rest of the world, North Atlantic fixing activity has also been depressed YTD 2016. We do not rule out the potential for further suspensions and/or early contract terminations in 2016. The strong oil price drop has reduced oil companies’ spending on exploration drilling, and we expect the number of North Sea exploration wells to come down in 2016. Sanctioning of new field developments is also likely to remain subdued as long as the oil price remains low, which will impact development drilling. Against this backdrop, we expect few contract options to be exercised, accompanied by depressed fixing activity.

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There are also a highly limited number of new contracted rigs expected to enter the North Sea and start drilling during 2016. We see a net decline of 11 rigs on the NCS by end-16 if no new contracts are awarded, i.e. five newbuilds to start drilling, while 16 come off firm contracts. There is a potential net decline of 17 rigs on UKCS through 2016, i.e. 20 rigs coming off contracts, while three new rigs potentially starts drilling. Simultaneously, we have seen contracts being cancelled and suspended in The NSEA, by Statoil, ConocoPhillips and Chevron. Furthermore, we are seeing reduced demand for the large AHTS vessels,with Petrobras recently cancelling tenders and vessels already on contract is being cancelled. More vessels coming off contracts internationally will likely find their way to the North Sea spot market, as vessel owners have few other places to trade large AHTS vessels. Arctic campaigns (e.g. Greenland, Russia) have in the previous years absorbed significant capacity in the high-end AHTS market, but such campaigns also seem highly unlikely for the foreseeable future. The international markets for large AHTS vessels largely mirror developments in the North Sea, but are more tilted towards jack-up support, rig towage, FPSO support and offshore construction support. The same forces affecting the North Sea market is, however, expected to also impact international markets, with reduced rig activity being of particular importance. As for the North Sea, we expect utilization and rates to come down, and vessels to come off contracts. The prospects for medium-sized AHTS vessels seem the least depressed, as the renewal of the jackup fleet will continue in the period going forward. However, the larger AHTS vessels, which are mostly in service with conventionally moored floaters, may face some headwind due to a softer floater market. Smaller sized AHTS vessels are not seen to have the same demand drivers in place. These vessels are often too small, for example, to support the new and larger jackups that are being delivered. At the same time this asset class is meeting increased competition from PSVs and therefore we expect day rates to remain largely unchanged through 2016. We believe that the demand for oil services will come back first for the shallow water segments, as these typically have a lower break even cost. Also, these fields are often managed by NOC's, whom have been less aggressive in cutting investments thus far in the cycle. We are therefore somewhat more optimistic on the jack-up rigs than on the floaters going forward. When it comes to offshore regions, we are more positive towards the Middle East and the South-East Asia. The Middle East is shallow water, and dominated by the large NOC's. Also, the lifting cost here is acceptable at oil price levels around USD 50/bbl. There also seem to be somewhat more optimism in South East Asia, with long term rig tenders out in the market by oil companies wanting to use the current weak market to secure cheap rigs. Once these are fixed, long term contracts for OSV supporting these units will likely follow.

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Global AHTS term rates

Wafr 5,000 BHP WAfr 12,000 BHPWAfr 16,000 BHP Far East 5,000 BHPFar East BHP 12,000 North Sea 16,000 BHPBrazil16,000 BHP


Utilization and day rates expected to drop With demand growth expected to fall sharply and fleet growth estimated to remain high, we expect utilization and charter rates to drop further in 2016. We have already started to see this materialize, with long term charter contracts increasingly entered into at rates close to OPEX. Our estimates naturally vary somewhat across regions and vessel specifications, but with the rig count expected to come down in all areas, there are no regions where we expect positive rate development during 2016. Remaining fleet growth might be mitigated by delays The current market situation involves significant overcapacity in the OSV sector, especially for the PSV fleet. We are coming from a period of very strong fleet growth, where the majority of newbuilding orders were placed in Asia, and perhaps it’s not so strange that it’s time for a breather. Take PSVs > 1,000 dwt and AHTSs < 10,000 bhp as an example; from 2005 to 2015 we recorded the fleet grew 130 percent globally as 1770 vessels were added to the fleet(!). This is a significant amount, and tells a story of a very active newbuilding market. OSV fleet growth further looks set to remain high, with the orderbook scheduled for delivery in 2016 (and beyond) currently standing at about 450 vessels, of which 270 are PSVs and 180 are small AHTS (4,000-9,999 BHP) (Jan 2016). Compared to the existing fleet of around 3,000 OSV's, this corresponds to a continued fleet growth of roughly 15 percent. Historically, we have seen a net slippage of around 30%, which should imply that a fair share of deliveries will be pushed out in time. Increased market uncertainty across oil services, financing challenges, speculative orders and orders placed at inexperienced yards, e.g. in Asia, should also lead to some cancellations going forward, as well as deliveries being further postponed. Improving productivity as the yards in general gain more experience, combined with easing pressure along the supply chain, should to some extent counter these effects. In sum, we assume net slippage to be roughly in line with previous years, i.e. around 30 percent. Surprisingly, ordering activity for OSV newbuilds remained high throughout 2014, in spite of the market starting to come down during the second half of the year. In total, we estimate 271 OSV's to have been ordered, consisting of 191 PSVs and 80 small AHTS vessels. This implies an ordering activity roughly in line with previous years, with 290 OSVs ordered in 2013 and 273 OSVs in 2012. However, 2015 saw a much lower ordering activity, with less than 70 vessels being ordered across both OSV and AHTS. OSV focused yards prove they can win contracts for Fisheries and Aquaculture, as these segments are getting increasingly complex, with synergy effects from OSV construction. Specialized vessel projects against solid contracts and non-OSV orders help ensure some backlog for yards trying to survive the down-cycle. We do not foresee any uptick in ordering activity for next year, but one might see specific vessels being ordered against firm contracts.

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Speculators are owners of 30-40% of the orderbook. There is reason to suspect that many of these units never will be delivered, as most of the speculators do not have either the money or the capacity to take delivery and operate these vessels. Therefore, there are a number of vessels presently ready for delivery in China, as many market players are trying to delay deliveries as far as possible. For example, we currently count 138 PSVs either ready for delivery or scheduled for delivery within the next three months, creating a depressing outlook for next year. We have already seen some Chinese yards going bankrupt, and expect more to come. With regards to resale, we recorded 8 small AHTS (4,000-7,999 bhp) and 14 medium sized PSVs (600-849 m2) in December 2014 – pretty much exactly one year ago. Today, of the same tonnage, we count more than 40 small AHTS and 50 medium sized PSVs. Total 2015 2016 2017+ In service On Order

AHTS 4-7,999 BHP 123 65 53 5 1255 10 %

AHTS 8-9,999 BHP 46 10 23 13 211 22 %

AHTS 10-15,999 BHP 44 8 32 4 331 13 %

AHTS 16-19,999 BHP 12 1 4 7 120 10 %

AHTS 20,000+ BHP 12 3 2 7 86 14 %

A H T S T o tal 237 87 114 36 2003 12 %

PSV <500 m2 23 9 14 0 412 6 %

PSV 500-749 m2 77 35 42 0 533 14 %

PSV 750-899 m2 99 34 62 3 189 52 %

PSV 900+ m2 73 22 40 11 401 18 %

P SV T o tal 272 100 158 14 1535 18 %

T o tal Orderbo o k 509 187 272 50 3538 14 %

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OSV Fleet Growth

AHTS PSV


Overview The drop in oil prices to below $30 in Q1 should mark the low point for this cycle. Over the coming six months it should become increasingly clear that fundamentals have turned the corner and are improving. That should underpin a more sustained price recovery. The 2015 price crash has more parallels with the relatively short-lived collapse of 1998 than the prolonged depression from 1985. We do not see the market as structurallyimbalanced and fundamentals have begun to respond to the price plunge. Demand growth doubled last year while supply is set to flatten this year. Despite the ballooning inventory overhang, we see long-term fundamentals as strong; Capacity utilization is very high, demand growth is decent while supply growth is slowing sharply. We expect that prices over time will reflect these changes and rise as a cyclical tightening of fundamentals gets underway. Our price forecast (Brent) is $50 for 2016, $70 for 2017 and $80 for 2018 Cyclical status and outlook; All about 1998 rather than 1985 Oil prices have a history of moving in long cycles, which makes determining the driving forces all-important. There have been five oil price collapses during the past 30 years. Two have been unambiguously demand driven; 2008 (Financial Crisis) and 1997 (Asian Crisis) one has been unambiguously supply driven; 1985 (Opec’s shift to chase higher market share via netback pricing). The 1998 decline, meanwhile, contained both higher Opec production and a weak global economy. Both of these elements have been key drivers in the latest price drop.

The oil market; Surprise supplies

…due to a lack of spare capacity The main parallel that we see between 1998 and today is the lack of spare capacity. In both cases, Opec spare capacity was low, below 3 mbd. In contrast, spare capacity was some 15 mbd when the cartel decided to go for higher market share, via netback pricing, in 1985. If correct, the implication is that the bottom of the current cycle should be “V”–shaped and short, rather than prolonged. Inventories are sky-high, but are not a leading indicator, contrary to E&P spending While the market evidently is in surplus at present with global oil inventories at an all-time high, this can best be described as a problem of stock and is a backward looking metric. The key determinant going forward will be the development of flows, as determined by changes in market fundamentals. Demand has already responded forcefully, growing twice as fast as expected last year. This year is seeing the start of a significant supply response. In short, we expect the market to move into deficit from the second half of the year and onwards. Not only will that begin to eat away at the inventory overhang, we expect it to also shift the market’s attention from the current “glut” and back to (lack of) spare capacity. The result, we expect, should be a significant re-pricing back into the $50-70 range which we expect will be dominant over the next two to three years. Q1 reversal all about sentiment. Q2 will be acid test for fundamentals Last year’s recovery attempt failed in June, and instead accelerated into a “spiral of death”. We foresee a different pattern this year because we believe fundamentals have begun to improve. The basis for improvement is only a relative one in 1H, with “real” improvement having to wait until 2H but it will be a start. Under such conditions market sentiment is key, and that improved towards the end of Q1.


Macro sentiment has improved. Saudi “line-in-sand” sends important signal Panic over weakening growth has been replaced by cautious optimism in the wake of better economic data from the US and the Eurozone and promises of more stimuli from central banks, including China. Saudi Arabia’s attempt to draw a line in the sand at $30 has been another important development affecting market sentiment. While talk of Russia and Saudi Arabia striking a deal to “freeze” production at peak levels in an oversupplied market, was initially scoffed at, history has shown that previous Opec production agreements have started with players far apart but have eventually narrowed and resulted in a supply deal. The return of Iran production makes a supply deal much more difficult for political reasons, indeed our Base Case is that there will be no deal, but we also believe that Opec production will not come close to last year’s 1.5 mbd increase. Iran’s exports will likely rise only gradually and we expect to see declines in other countries, notably Venezuela, through the year. Fundamentals improving, at the margin On the oil fundamentals’ side, things have begun to improve, albeit at the margin only, so far. Global supply growth has come down to around 1.5 mbd (y-y), which, although still significant, is less than half the rate of the previous six months. The change is driven by the shift from growth to decline in the US, but minor declines have begun to show up elsewhere, notably in Latin America. In line with an improved macro sentiment, oil demand figures have also shown a rebound, indicating that the weather rather than a marked weakening of the macro climate was the driver of weakness in the winter months. Gasoline demand has rebounded sharply in the US and is growing very strongly in China and India. Q2 will serve as an acid test for recovery. We expect a lower-than-normal inventory build as demand will decline by less than normal from Q1, partly because of that mild winter . With an expected decline in oil production, the inventory build should surprise on the low side. A key feature should be the start of a significant drop in US crude oil inventories. The buildup having taken place this year, making media headlines every week, is driven by rising imports not by production, which is falling. When Asian refinery demand returns in Q2, competition for US import barrels will increase which in turn should lead to upward pressure on prices. In our view this should be seen as an early step in the long process of rebalancing market fundamentals and a stepping stone to a genuine market tightening starting in 2H, a development which should support a price recovery.

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2017-2018; Effect of spending cuts to depress global supply In our view, “the game” in the oil market the next few years will be all about supply. We expect demand gains to be relatively steady at 1.0-1.5% p.a., as rapid growth in living standards of emerging markets will continue to drive transportation growth. Demand in the mature OECD economies is set to peak on an absolute basis and begin to decline, but it will be a moderate drop, no collapse. Barring a new global recession, which of course cannot be ruled out, we expect global gains to be relatively steady. Changes are expected to be much bigger for supply than demand Much larger variations can be expected on the supply side of the market, in our opinion. Global capital expenditure in production and exploration has gone through its “biggest drop ever”, according to the IEA, and is set to fall further this year. While service costs of course also are coming down and productivity has gone up, particularly in the highly dynamic North American market, we find the spending declines and observable crisis in the service industries difficult to square with the IEA’s medium-term view of a one-year decline in output (2016) and a return to the same growth outlook they held a year ago from 2018 onwards. Historically, supply cycles have been relatively long, lasting on average 5-7 years from peak to trough. The IEA has already dramatically altered its view on 2016 over the past year, going from an expected increase of +0.5 mbd to an expected decline of -0.7 mbd in its latest forecast. In this context we will be surprised if the current downturn is over already in 2017. The US shale revolution has led to a two-tiered oil market in terms of project development and economics. Where traditional non-Opec production has been capital-intensive, long lead-time projects, US shale is seen as variable cost and short-lead times. Indeed, US supply takes the biggest hit with a 0.5 mbd decline this year before flattening out and beginning a rebound in 2018.

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Oil Production (Output in mbbl/d)


Non-Opec, non-US production expected to drop in 2017-18 What this effectively means, however, is that current forecasts assume that non-Opec producers ex US will continue to grow through in 2017 and 2018. We see this development as unlikely based on the decline in spending and rig activity and the expected coming increase in depletion as the impact of less in-field drilling sets in. The decline in US production is expected to continue through 2017 before bottoming and commencing a rebound in 2018 which is expected to grow gradually stronger towards 2020. The crucial difference with the 2013-2015 period is that the world will need whatever oil the US is capable of producing in the next upturn in order to compensate for declines elsewhere. We assume non-Opec production will decline by 1.0 mbd this year and by somewhat less in 2017 before commencing a rebound. Combined with our demand growth scenario outlined above the call-on-Opec crude will rise from 32 mbd in 2016 to more than 35 mbd in 2018. The difference will have to be covered by commercial inventories. We expect inventories to begin a sustained decline from current all-time highs in the second half of this year and estimate that they should fall to the low end of the five year range by the end of 2018. The decline in inventories is expected to return the market’s attention to the low level of spare capacity in the global production chain, triggering a risk in the supply risk premium on top of tight fundamentals.

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Brent Price (USD /bbl)


At cruising altitude but beware of turbulence The tanker market has entered 2016 with a tailwind powered by strong fundamentals: Capacity utilization is near the spike-triggering 90% mark, trade growth is at a multi-year high and distances are lengthening. Fleet growth is picking up, but moderately and from a low level, so far. While 2016 has the looks of another strong year, we believe investors should be prepared for a different journey than in 2015. Fleet growth is on the rise while trade growth is expected to moderate. Fleet utilization should still remain high but the freight market is vulnerable to how the oil inventory overhang will be absorbed. Stronger oil demand and floating storage is good news, while lower production and inventories is not. The long-term outlook (towards 2020) has improved, in our view. The low oil price environment should redraw the oil trade map in favor of the Middle East, which will make it favorable for tankers. On the fleet capacity side, we expect that continued challenging capital markets will restrict ordering. Ongoing slippage and increasing fleet replacement needs should serve to further limit fleet growth. All-in-all, prospects appear unusually good for a well-balanced market in the medium-term. The New Year starts on a slower note as high inventories level the playing field As expected, the market turned in a strong fourth quarter finish as Middle East exports surge again with much of it heading to the US, where seaborne imports increased y-y for the first time in six years. The New Year has started on a softer note with freight rates hitting “air pockets” for no apparent reason. In our view, this is a result of the “new normal” in the oil market, where refiners sitting on record-high inventories have a higher degree of flexibility than normal, allowing them pull back from the spot market for longer periods than normal in order to prevent from overheating. The predictable result is a build-up of spot tonnage and downward pressure on rates. This goes on until charterers decide to come down off the fence and then the pendulum swings in the other direction

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The Tanker market

2015; A banner year, but time to look ahead While 2014 had been a year of exceptionally low fleet growth leading to tightening market fundamentals, 2015 was the year of demand. We estimate that tonnage demand, including volume, trading distances and productivity factors, rose by around 7%, more than twice the growth rate seen in 2014. Fleet growth picked up somewhat but remained well below trend at 2.5%. Fleet utilization thus rose by around 4%-pts to nearly 90%, the highest level since 2008. Oil trade is driven by production and 2015 was the best year in a decade in that regard, with world oil production rising by more than 3 mbd (3.5%). Of particular importance for the tanker market was the shift in geographical locations which took place; Higher Middle East output explained about 50% of the increase, as Iraq and the Saudi Arabia took to the pumps, making it a very “shipping intensive” year. In volume terms, Europe was the biggest gainer with an increase of 0.6 mbd (prel. estimate), as its refineries sharply raised utilization to meet higher local demand and boost exports in a growing world market. Chinese imports were a close second, powered by a strong demand response and further additions to its strategic oil reserves. The decline in seaborne imports to the US continued for its sixth straight year, but, importantly, the rate of decline showed markedly to around 6%, less than half of the decrease in the previous two years. Average trading distances increased only modestly, owing to a large drop in MEG-US exports, but floating storage emerged as a key support factor. Contrary to 2009/’10, however, logistics rather than price speculation has been the main driver. Measuring the level of floating storage is challenging, but we estimate that between 1% and 2% of the total tanker fleet has been employed in storage, mostly on VLCCs. Finally, we find little evidence that higher average speed, the supposed “grim reaper” for the tanker market, has had much impact. While average ballast speed for the VLCCs picked up markedly through the winter, there was little change for other segments (which spend more time in port, on average).


Fleet growth; On the upswing but moderately so far Following two years of sharply slower fleet growth, the trend turned up last year but the level remained modest in a historical perspective. The total fleet (including product tankers) grew by 2.5%, as deliveries remained at a very low 17 mdwt. The crude fleet grew by a very modest 1.5%, concentrated in VLs and Suezmaxes, while crude aframaxes declined. The clean fleet, on the other hand, continued its rapid expansion, growing by 5% from the year earlier, as LR2s and MRs both expanded by nearly 10% each. Scrapping and phase-outs declined markedly in line with the increase in freight rates and hit an “all-time” low on both an absolute and relative basis at 3.2 mdwt, less than 1% of the fleet. Market likely to flatten as fundamentals gradually normalize The tanker market is coming off two years of significant tonnage deficits but is now likely to gradually return to a more even playing field. Most obvious, significantly higher deliveries will boost fleet growth, to 4-5% p.a. in 2016 and 2017. Tonnage demand growth, on the other hand, is expected to normalize following the spectacular gain seen over the past eighteen months. That still means growth, but in a lower, and more normal, 4% range. Macro and oil market uncertainties weigh… The year has opened with a new round of macro uncertainties, triggering the worst start of the year “ever” in global stock markets and fresh downturn for globalcommodity prices. A clearer verdict for “weaker growth” is hard to imagine. Yet, we do not see the data actually released from the US, China and the Euro as consistent with a developing recession and we thus stick with a scenario of a gradually improving world economy. Improving oil demand played a big role in the strong trade growth figures seen during the past year and remains a key issue for 2016. The IEA is forecasting a sharp deceleration of demand growth from 1.7 mbd to 1.2 mbd as the effect of the sharp price decline fades. History has shown, however, that the impact of lower prices can take two to three years to fully play out. We thus believe there is still a case for oil demand to outperform expectations, although not to the extent it did last year when growth turned out to be nearly twice as high as was expected at the start of the year.

Compounding the challenge posed by inventory overhang If oil demand continues to grow while production declines, the long buildup of oil inventories is likely to go into reverse eventually. The impact on the freight market is likely to be two-fold; In the short-term, the reaction will most likely be negative. Trade will slow, possibly decline, and tonnage presently employed for floating storage will return to active trading. In the longer-term, however, the decline in non-Opec production will create more room for Opec oil, which is positive for tankers. We expect these factors to be of greater importance for 2017 than for 2016, but awareness and monitoring should begin now. Trade growth to slow in line with global oil production… The oil market is likely to undergo a significant change in 2016 as the supply side begins to react to the sharp drop in prices. Non-Opec production is expected to fall by around 0.5 mbd (1%), a sharp turnaround from average production increases of around 2 mbd for each of the past two years. Lower US production will lead the decline, and a consequent rebound in seaborne imports should thus buffer the impact on tanker demand, but overall trade growth will slow. Opec production, which was the key driver of trade growth in 2015, is also unlikely to repeat that performance. Spare capacity has returned to its low point for the past decade and it is thus hard to foresee a sharp rise in production similar to 2015. Other producers are at capacity and could just as well see some declines as the impact of falling oil prices bite. The exception, of course, is Iran, which is set to increase its presence in the world oil market following the removal of sanctions. The timing and scale of higher Iranian oil exports is subject to many unknown factors, but consensus among analysts is for a relatively rapid increase of about 0.5 mbd, anything beyond that may not be online until late in the year. For other Opec members, notably Venezuela, Nigeria and Libya who are heavily impacted by the low oil price, production could possibly drop.


Recovery in rates – although from extremely low levels Freight rates have recovered significantly over the last two months compared with the extreme low levels witnessed in the first quarter of this year. However, the current earnings are only covering more or less operating costs for most sizes. Spot rates for Capesizes and Panamaxes have climbed from less than $3,000 per day in February to approximately $7,000 and $5,000 per day, respectively. Supramax tonnage obtain currently close to $6,000 per day, while Handysize earning is around $5,000 per day. This is up from around $2,500 in February. Asset values also seems to have stabilized and in some segments we have even noticed slightly firmer prices recently. Stronger Chinese imports The seaborne dry bulk activity has recovered over the last few months after a lackluster start of the year. The main reason is elevated imports to China. When comparing the first 4 months with the same period of last year, Chinese iron ore imports were nearly 7 percent higher, while bauxite and soybean imports escalated by 23 percent and 12 percent, respectively. Coal imports however, were down 2 percent and grain imports dropped by 14 percent. In total, Chinese dry bulk imports rose 4.6 percent. Dry bulk imports to other Asian countries showed in total a moderate drop in iron ore and coal, while we registered higher steel products imports to several countries. Elsewhere we noticed an upswing in fertilizer imports to Brazil, but a drop in the US urea imports. Coal imports to Europe continued to drop and were 20 percent lower year on year. Iron ore imports to Europe fell 11 percent. Grain and soybean transportation from major exporters rose about 15 percent during the first 4 months. South American export rose about 50 percent, while Russian grain exports jumped nearly 30 percent. North American shipments however, fell around 5 percent. In total, global dry bulk trade is estimated to have increased only marginally during the first 4 months of this year measured against the comparable period last year.

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When is it Time for a dry bulk recovery?

Fleet trend Deliveries of new ships totaled nearly 23 mill dwt during the first 5 months of this year. This was 35% less than the scheduled deliveries according to the orderbook. Removals were slightly above 20 mill dwt, The size of the fleet was 2% larger than in the same period last year. Market prospects Even though the world economy is expected to improve over the following years, there is still a downside risk to this scenario in the short term perspective. Relatively slow growth in demand for raw materials is still negatively affecting commodity prices, especially in minerals. This is impacting economic activity in a couple of emerging market economies which are heavily dependent on export of raw materials. However, the most important factor for dry bulk demand will be China’s economic performance and especially China’s import requirements for iron ore and coal. China’s steel consumption is expected to decrease further this year. Export of steel products are expected to remain stable. However, potential trade issues whereby several countries are considering to introduce import tariffs on Chinese steel, might reduce exports. Therefore, steel production in China could decrease further. On these assumptions, growth in demand will fall short of the fleet expansion this year, leading to lower fleet utilization than in 2015. We should however, expect some volatility in earnings over the remainder of the year. Seasonality, trading patterns and productivity factors will all have potential implications on tonnage demand in shorter periods. In 2017 and 2018, tonnage demand is expected to gradually grow at a higher rate than the fleet size and thereby result in a recovery from late 2017 through 2018. The main risk elements for a slower than expected recovery in dry bulk fundamentals will be a slower than expected economic growth in China and less coal imports to India. Upside potentials for a quicker recovery will be a reduction in yards ability to deliver newbuildings and not least a stronger than expected stimulative economic policy in China resulting in stronger growth in raw materials imports.


China’s iron ore imports will therefore to a large extent be determined by how much of the domestic iron ore high cost capacity will be phased out and subsequently replaced by imports. Even though iron ore prices saw surprisingly high increase earlier this year, the forward prices are expected to decrease going forward. It is therefore plausible to expect an increase in closures of Chinese iron ore mines. Therefore, we forecast some 30 - 40 mill tons increase per year of iron ore imports to China in the coming years. For other importing countries, we do not foresee any dramatic changes compared to last year. One vital factor for dry bulk demand will be the trend in Chinese coal imports. If we assume electricity demand will climb 2 – 3% per year, the main question will be at what pace will the capacity of alternative electricity increase. Expansion of hydro power capacity will be limited over the following years as the Chinese government has scaled down on the new hydro dam projects. Even though capacity of other renewables will expand significantly, these will still be relatively small in the total energy mix. It is therefore plausible to expect stabilization of coal consumption in 2016 and 2017. As for a stabilization in coal imports, it will to a large extent be determined by the Chinese government’s policy to support domestic coal mining. We believe imports will stabilize, at least for this year. In the longer term, however, there is probably higher downside risk than upside potential in coal imports. One upside potential in coal trade is in higher Indian imports. Expanding steel production coupled with increasing number of coal-fired power plants, will generate higher growth in coal demand. Although Indian government has carried out successful reforms to boost domestic coal mining, coal imports will continue to grow as India will not be able to procure all of its coal requirements domestically.

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Elsewhere in Asia, there are a few new coal-fired power plant projects, namely in Japan, Indonesia, Vietnam etc. under construction which should give some boost to coal trade. Trade of other dry bulk commodities, especially in the minerals sector, can be best explained in relation to the economic growth. Bauxite exports will continue to grow from expanding production capacities in Australia and West Africa. As for the nickel ore trade, there is limited potential for a recovery as new projects are not in the pipeline in the medium-term. Grain and soybean exports are expected to remain steady over the following months. Fertilizer trade is expected to increase, especially to India and Brazil. In our base case scenario, we predict seaborne dry bulk trade to increase in the region of 1% in 2016 followed by 2 – 3% escalation p.a. in 2017 and 2018. Growth in real tonnage demand is not expected to deviate significantly from the volume growth. Sailing distances in grain, soybeans and some industrial commodities are expected to rise, while we foresee relatively small changes in iron ore and coal. Ship sailing speed is not anticipated to increase significantly until freight rates reach much higher levels. Fleet trend The fleet is anticipated to expand between 1 and 2% this year, followed by less than 1% increase p.a. in 2017 and 2018. We assume deliveries to total around 45 - 50 mill dwt in 2016, slowing to 35 - 40 mill dwt in 2017 and some 25 mill dwt in 2018. However, extremely difficult financial situation in the dry bulk industry might result in fewer deliveries than forecasted. Removal volumes are expected to reach 45 mill dwt this year, followed by 29 mill dwt in 2017 and 20 mill dwt in 2018.

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The Baltic Dry Index (Excluding levels above 4000)


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PROJECTS ESTABLISHED 2004 NO. OF VSLS. ESTABLISHED CURRENCY TOTAL PROJECT

PRICE PAID IN CAPITAL

UNCALLED CAPITAL

TOTAL COMMITTED CAPITAL

Aries (Ugelstad) Supply I KS 1 April 2004 NOK 201 046 770 42 300 000 15 000 000 57 300 000 Ross Cape DIS 1 October 2004 USD 17 350 000 3 850 000 1 000 000 4 850 000 International Container Ships KS 2 November 2004 USD 66 260 000 12 260 000 4 150 000 16 410 000 J.B.U OBO I KS 1 December 2004 USD 36 580 000 7 780 000 5 000 000 12 780 000

No. of vessels 5 Total NOK 201 046 770 42 300 000 15 000 000 57 300 000 No. of projects 4 Total USD 120 190 000 23 890 000 10 150 000 34 040 000

Total EUR 0 0 0



UNCALLED CAPITAL


Eidsiva Trucker KS 1 February 2005 EUR 10 900 000 2 470 000 2 000 000 4 470 000 Mount Faber KS 4 April 2005 USD 80 900 000 13 325 000 0 13 325 000 Norwegian Shipping DIS April 2005 USD 19 200 000 13 700 000 5 500 000 19 200 000 Goliat Roro KS 1 May 2005 EUR 9 000 000 1 960 000 1 500 000 3 460 000 Global Cable KS 2 June 2005 USD 12 320 000 2 870 000 3 000 000 5 870 000 Bergshav Chemical KS 2 July 2005 EUR 20 470 000 4 470 000 2 200 000 6 670 000 Volstad Supply I KS 1 August 2005 NOK 262 620 000 75 050 000 20 000 000 95 050 000 Scandinavian Bulkers KS 5 September 2005 EUR 28 926 000 6 776 000 6 000 000 12 776 000 Volstad Supply II KS 1 November 2005 NOK 262 620 000 75 050 000 20 000 000 95 050 000 Agder Ocean Reefer KS 3 November 2005 USD 27 750 000 6 150 000 0 6 150 000 Celine I OBO DIS 1 November 2005 USD 12 470 000 1 970 000 3 000 000 4 970 000 Cement Ship II DIS 1 November 2005 USD 19 800 000 5 575 000 4 000 000 9 575 000 Multipurpose Bulkers DIS 4 December 2005 EUR 27 145 000 4 695 000 4 500 000 9 195 000 SBS Tempest KS 1 December 2005 NOK 134 300 000 29 300 000 10 000 000 39 300 000 SBS Torrent KS 1 December 2005 NOK 141 175 000 31 975 000 10 000 000 41 975 000 Green Pacific DIS 3 December 2005 USD 30 590 000 6 090 000 8 000 000 14 090 000


Total EUR 96 441 000 20 371 000 16 200 000 36 571 000



UNCALLED CAPITAL


Norwegian Shipping II DIS January 2006 USD 8 000 000 5 200 000 2 800 000 8 000 000 SBS Typhoon KS 1 January 2006 NOK 167 050 000 36 650 000 25 000 000 61 650 000 Japan Offshore DIS 3 April 2006 USD 37 150 000 8 150 000 3 000 000 11 150 000 Aries (Ugelstad) Supply II KS 1 April 2006 NOK 155 000 000 33 000 000 21 000 000 54 000 000 European Venture DIS 2 April 2006 USD 46 325 000 9 965 000 5 000 000 14 965 000 NFC Offshore DIS 4 April 2006 USD 74 500 000 24 480 000 8 000 000 32 480 000 Oceanlink Offshore DIS 1 May 2006 USD 13 250 000 2 750 000 2 500 000 5 250 000 Panda Chemical Oil DIS 1 June 2006 USD 19 545 000 4 345 000 1 500 000 5 845 000 Western Chemical KS 3 July 2006 EUR 32 775 000 7 095 000 5 750 000 12 845 000 Singapore Offshore DIS 5 August 2006 USD 129 100 000 8 500 000 8 000 000 16 500 000 Oceanlink Offshore II DIS 1 August 2006 USD 12 000 000 2 250 000 2 250 000 4 500 000 Japan Offshore II DIS 3 September 2006 USD 39 075 000 8 775 000 7 825 000 16 600 000 NFC Offshore III DIS 2 October 2006 USD 46 046 000 14 186 000 8 666 000 22 852 000 Japan Offshore III DIS 2 October 2006 USD 47 340 000 10 540 000 9 430 000 19 970 000 Oceanlink Offshore III DIS 2 October 2006 USD 28 500 000 5 200 000 9 600 000 14 800 000 Agder Ocean Reefer II DIS 2 November 2006 USD 19 500 000 4 500 000 4 500 000 Northern Offshore DIS 2 November 2006 USD 39 000 000 8 400 000 6 740 000 15 140 000 Norwegian Product DIS 2 November 2006 USD 32 865 000 7 265 000 6 500 000 13 765 000 Global Cable II DIS 2 December 2006 USD 45 400 000 9 400 000 6 000 000 15 400 000


Total EUR 32 775 000 7 095 000 5 750 000 12 845 000

Projects established per year


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UNCALLED CAPITAL


Ross Chemical DIS 5 February 2007 USD 119 100 000 25 100 000 12000000 37 100 000

Atlantic Guardian DIS 1 February 2007 USD 42 880 000 8 100 000 8 000 000 16 100 000

NFC Panamax DIS 1 March 2007 USD 24 650 000 4 650 000 4 650 000

Orchard Offshore DIS 4 March 2007 USD 43 800 000 7 800 000 2 125 000 9 925 000

Raffles Offshore DIS 1 March 2007 USD 45 945 000 12 445 000 4 500 000 16 945 000

Norwegian Offshore DIS 4 April 2007 USD 65 470 000 21 900 000 6 000 000 27 900 000

Med Ethylene DIS 2 May 2007 USD 27 875 000 6 275 000 4 500 000 10 775 000

Ullswater Subsea DIS 1 May 2007 USD 48 820 000 12 820 000 5 000 000 17 820 000

European Venture II DIS 1 July 2007 USD 11 370 000 3 370 000 6 000 000 9 370 000

Tioman Offshore DIS 1 July 2007 USD 51 150 000 11 150 000 11 150 000

Sentosa Offshore DIS 4 July 2007 USD 46 350 000 8 300 000 8 300 000

Southern Chemical DIS 3 July 2007 EUR 88 200 000 10 350 000 10 000 000 20 350 000

Bovey Offshore Ltd 4 August 2007 USD 43 600 000 10 500 000 10 500 000

Asian Bulkers DIS 3 October 2007 USD 142 875 000 49 075 000 49 075 000

Short Sea Shipping DIS 4 November 2007 EUR 24 800 000 4 550 000 4 500 000 9 050 000

Ross Chemical IV DIS 2 November 2007 USD 53 000 000 18 000 000 18 000 000

Dongguan Chemical Tankers DIS 1 November 2007 USD 32 750 000 7 150 000 7 000 000 14 150 000

Pantheon Chemical DIS 1 November 2007 EUR 31 000 000 5 160 000 5 500 000 10 660 000

No. of vessels 43 Total NOK

No. of projects 18 Total USD 799 635 000 206 635 000 55 125 000 261 760 000

Total EUR 144 000 000 20 060 000 20 000 000 40 060 000



UNCALLED CAPITAL


Marineline Chemical DIS 3 February 2008 USD 79 850 000 12 680 000 12 680 000

Edda Accommodation DIS 1 February 2008 EUR 126 500 000 44 000 000 12 000 000 56 000 000

NFC AHTS Limited 2 March 2008 USD 70 520 000 24 600 000 24 600 000

Bukit Timah Offshore DIS 3 May 2008 USD 125 269 250 29 269 250 29 269 250

Mountbatten Offshore DIS 2 May 2008 USD 109 134 000 25 134 000 25 134 000

Bovey Offshore Ltd. 4 May 2008 USD 42 650 000 14 475 000 14 475 000

Semakau Producer DIS 1 July 2008 USD 20 400 000 20 400 000 20 400 000

European Venture III DIS 1 July 2008 USD 17 720 000 5 720 000 5 000 000 10 720 000

Golden Kamsar DIS 1 August 2008 USD 67 294 000 17 294 000 12 500 000 29 794 000

Jimbaran DIS 1 September 2008 USD 54 200 000 9 035 000 9 035 000

Seminyak DIS 2 September 2008 USD 108 963 000 18 618 000 14 000 000 32 618 000

JBUS Offshore DIS 2 September 2008 USD 60 000 000 27 000 000 27 000 000

Oceanlink Reefer III DIS 1 September 2008 USD 20 200 000 5 200 000 5 000 000 10 200 000

Agder Ocean Reefer KS 7 October 2008 USD 53 500 000 10 000 000 7 000 000 17 000 000


No. of projects 14 Total USD 829 700 250 219 425 250 43 500 000 262 925 250

Total EUR 126 500 000 44 000 000 12 000 000 56 000 000



UNCALLED CAPITAL


Leighton / ICON 3 July 2009 USD 135 000 000 10 000 000 10 000 000

ICON Victorious 1 USD 42 500 000 37 750 000 37 750 000

Diving Bell 1 USD 10 000 000 8 000 000 8 000 000


No. of projects 3 Total USD 187 500 000 55 750 000 55 750 000

Total EUR


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PRICE PAID IN CAPITAL UNCALLED

CAPITAL TOTAL COMMITTED

CAPITAL Octavian Bulker DIS 1 July 2009 USD 37 400 000 16 000 000 16 000 000 Shanghai Bulker DIS 1 USD 9 000 000 1 670 000 1 670 000 Saragol Tankers 1 DIS 1 USD 48 237 500 17 737 500 17 737 500 Saragol Tankers 2 DIS 1 USD 54 312 500 18 812 500 2 000 000 20 812 500

No. of vessels 4 Total NOK No. of projects 4 Total USD 148 950 000 54 220 000 2 000 000 56 220 000

Total EUR 0 -




CAPITAL Northern Supply DIS 2 May 2011 USD 88 000 000 20 800 000 19 280 000 40 080 000 Redfish Offshore 2 November 2011 USD 45 000 000 9 000 000 9 000 000


Total EUR




CAPITAL Singapore Supply DIS 1 March 2012 USD 42 700 000 10 240 000 8 580 000 18 820 000 Industrial Shipping DIS 7 March 2012 EUR 25 950 000 5 750 000 5 750 000 Vestland Marine PSV DIS 1 April 2012 USD 1 650 000 1 650 000 1 650 000 MS Nordstjernen DIS 1 November 2012 NOK 6 000 000 6 000 000 6 000 000

No. of vessels 10 Total NOK 6 000 000 6 000 000 6 000 000 No. of projects 4 Total USD 44 350 000 11 890 000 8 580 000 20 470 000

Total EUR 25 950 000 5 750 000 5 750 000




CAPITAL Feeder Container Vessel DIS 1 USD 4 300 000 4 300 000 4 300 000 Sudong Offshore DIS 1 October 2013 USD 26 000 000 8 200 000 8 200 000 Panda Chemical II DIS 1 USD 4 315 000 1 815 000 2 000 000 3 815 000


Total EUR




CAPITAL Vestland Marine Seismic DIS 1 February 2014 USD 1 550 000 1 550 000 1 550 000 High Yield Shipping DIS 1 April 2014 USD 6 000 000 6 000 000 6 000 000 CIT-Grieg Lygra 1 June 2014 USD 49 000 000 49 000 000 49 000 000 CIT-Grieg Minerva 1 June 2014 USD 17 100 000 17 100 000 17 100 000 DSV Alliance DIS 1 June 2014 USD 21 500 000 10 112 500 10 112 500 Aberdeen Offshore DIS 1 November 2014 USD 71 464 000 32 464 000 32 464 000 Lesley Product DIS 1 November 2014 USD 2 355 000 2 355 000 2 355 000

No. of vessels 7 Total NOK No. of projects 7 Total USD 168 969 000 118 581 500 0 118 581 500

Total EUR




CAPITAL Bergshav Aframax AS 2 January 2015 USD 10 000 000 7 500 000 2 500 000 10 000 000 CIT-Thor Magni 1 February 2015 USD 21 500 000 21 500 000 21 500 000 Homborsund Container DIS 1 April 2015 USD 4 900 000 4 900 000 4 900 000 Henrietta Product DIS 1 April 2015 USD 10 400 000 8 400 000 8 400 000 CIT-Thor Modi 1 May 2015 USD 21 500 000 21 500 000 21 500 000 CIT Thor Frigg 1 May 2015 USD 21 500 000 21 500 000 21 500 000 Feeder Container II DIS 2 September 2015 USD 15 525 000 15 525 000 15 525 000 CIT-Thor Freyja 1 September 2015 USD 21 500 000 21 500 000 21 500 000


Total EUR


24


Projects Sold

# Projects sold Vessels Established Currency Total Project Cost IRR Sold 1 Diving Bell 1 July 2009 USD 10 000 000 N/A N/A 2 ICON Victorious 1 July 2009 USD 42 500 000 N/A N/A 3 Leighton / ICON 3 July 2009 USD 135 000 000 N/A N/A 4 Redfish Offshore 2 November 2011 USD 45 000 000 N/A N/A 5 Ross Chemical DIS 5 February 2007 USD 119 100 000 N/A N/A 6 Short Sea Shipping DIS 4 November 2007 EUR 24 800 000 N/A N/A 7 International Container Ships KS 2 November 2004 USD 66 260 000 95 % * 2005 8 Aries (Ugelstad) Supply I KS 1 April 2004 NOK 201 046 770 66 % 2007 9 Aries (Ugelstad) Supply II KS 1 April 2006 NOK 155 000 000 64 % 2007

10 Celine I OBO DIS 1 November 2005 USD 12 470 000 57 % 2007 11 Goliat Roro KS 1 May 2005 EUR 9 000 000 -25 % * 2007 12 Green Pacific DIS 3 December 2005 USD 30 590 000 N/A 2007 13 J.B.U OBO I KS 1 December 2004 USD 36 580 000 37 % 2007 14 Japan Offshore DIS 3 April 2006 USD 37 150 000 70 % * 2007 15 Japan Offshore II DIS 3 September 2006 USD 39 075 000 733 % * 2007 16 Japan Offshore III DIS 2 October 2006 USD 47 340 000 49 % * 2007 17 NFC Offshore DIS 4 April 2006 USD 74 500 000 477 % 2007 18 NFC Offshore III DIS 2 October 2006 USD 46 046 000 26 % * 2007 19 Northern Offshore DIS 2 November 2006 USD 39 000 000 153 % 2007 20 Ross Cape DIS 1 October 2004 USD 17 350 000 41 % 2007 21 Global Cable KS 2 June 2005 USD 12 320 000 28 % 2009 22 Semakau Producer DIS 1 July 2008 USD 20 400 000 19 % 2009 23 Eidsiva Trucker KS 1 February 2005 EUR 10 900 000 -100 % * 2010 24 NFC AHTS Limited 2 March 2008 USD 70 520 000 -5 % * 2010 25 Scandinavian Bulkers KS 5 September 2005 EUR 28 926 000 0 % 2010 26 Bergshav Chemical KS 2 July 2005 EUR 20 470 000 -48 % * 2011 27 European Venture II DIS 1 July 2007 USD 11 370 000 20 % 2011 28 JBUS Offshore DIS 2 September 2008 USD 60 000 000 3 % 2011 29 Mountbatten Offshore DIS 2 May 2008 USD 109 134 000 -8 % * 2011 30 Norwegian Offshore DIS 4 April 2007 USD 65 470 000 0 % 2011 31 Oceanlink Offshore DIS 1 May 2006 USD 13 250 000 16 % 2011 32 Oceanlink Offshore II DIS 1 August 2006 USD 12 000 000 35 % 2011 33 Pantheon Chemical DIS 1 November 2007 EUR 31 000 000 N/A 2011 34 Ross Chemical IV DIS 2 November 2007 USD 53 000 000 N/A 2011 35 SBS Tempest KS 1 December 2005 NOK 134 300 000 30 % 2011 36 Shanghai Bulker DIS 1 August 2010 USD 9 000 000 55 % 2011 37 Tioman Offshore DIS 1 July 2007 USD 51 150 000 10 % 2011 38 Volstad Supply I KS 1 August 2005 NOK 262 620 000 27 % 2011 39 Volstad Supply II KS 1 November 2005 NOK 262 620 000 38 % 2011 40 Western Chemical KS 3 July 2006 EUR 32 775 000 -60 % * 2011 41 Edda Accommodation DIS 1 December 2008 EUR 126 500 000 N/A 2012 42 Multipurpose Bulkers DIS 4 December 2005 EUR 27 145 000 N/A 2012 43 Norwegian Shipping DIS 1 April 2005 USD 19 200 000 15 % 2012 44 Oceanlink Reefer III DIS 1 September 2008 USD 20 200 000 N/A 2012 45 Agder Ocean Reefer II DIS 2 November 2006 USD 19 500 000 N/A 2013 46 Agder Ocean Reefer KS 3 November 2005 USD 27 750 000 N/A 2013 47 Cement Ship II DIS 1 November 2005 USD 19 800 000 19 % 2013 48 Jimbaran DIS 1 September 2008 USD 54 200 000 -100 % * 2013 49 Norwegian Shipping II DIS 1 January 2006 USD 8 000 000 8 % 2013 50 Oceanlink Offshore III DIS 2 October 2006 USD 28 500 000 N/A 2013 51 Raffles Offshore DIS 1 March 2007 USD 45 945 000 16 % 2013 52 Vestland Marine PSV DIS 1 April 2012 USD 1 650 000 30 % 2013 53 Agder Ocean Reefer KS 7 October 2008 USD 53 500 000 -67 % * 2014 54 Atlantic Guardian DIS 1 February 2007 USD 42 880 000 N/A 2014 55 Bovey Offshore Ltd 4 May 2008 USD 42 650 000 17 % 2014 56 Bovey Offshore Ltd 4 August 2007 USD 43 600 000 17 % 2014 57 European Venture III DIS 1 July 2008 USD 17 720 000 24 % 2014 58 Global Cable II DIS 2 December 2006 USD 45 400 000 21 % 2014 59 Marineline Chemical DIS 3 February 2008 USD 79 850 000 -100 % * 2014 60 Med Ethylene DIS 2 May 2007 USD 27 875 000 4 % 2014 61 Mount Faber KS 4 April 2005 USD 80 900 000 32 % 2014 62 Norwegian Product DIS 2 November 2006 USD 32 865 000 3 % 2014 63 Panda Chemical Oil DIS 1 June 2006 USD 19 545 000 -53 % * 2014 64 SBS Torrent KS 1 December 2005 NOK 141 175 000 23 % 2014 65 SBS Typhoon KS 1 January 2006 NOK 167 050 000 21 % 2014 66 RTS Panamax DIS 1 April 2007 USD 24 000 000 N/A 2014 67 Feeder Container Vessel DIS 1 May 2013 USD 4 300 000 23 % 2015 68 Northern Supply DIS 2 May 2011 USD 88 000 000 N/A 2015 69 Octavian Bulker DIS 1 July 2009 USD 37 400 000 -29 % 2015 70 Singapore Supply DIS 1 March 2012 USD 42 700 000 N/A 2015 71 Ullswater Subsea DIS 1 May 2007 USD 48 820 000 N/A 2015 72 DSV Alliance DIS 1 June 2014 USD 21 500 000 -100 % * 2016 73 Orchard Offshore DIS 4 March 2007 USD 43 800 000 18 % 2016 74 Singapore Offshore DIS 5 August 2006 USD 129 100 000 18 % 2016 75 Vestland Marine Seismic DIS 1 February 2014 USD 1 550 000 7 % 2016 75 Vessels financed and sold: 128 USD/EUR 1:1 (USD/NOK 8.20): ~$3 000 000 000

*Cash-on-cash return

25

Existing Projects & Segment

Offshore # Total project price European Venture DIS 2 USD 46 325 000 Bukit Timah Offshore DIS 3 USD 125 269 250 Sentosa Offshore DIS 1 USD 46 350 000 Sudong Offshore DIS 1 USD 26 000 000 Aberdeen Offshore DIS 1 USD 71 464 000

8

Tankers # Panda Chemical II DIS 1 USD 4 315 000 Southern Chemical DIS 2 EUR 88 200 000 Dongguan Chemical Tankers DIS 1 USD 32 750 000 Seminyak DIS 2 USD 108 963 000 Bergshav Aframax AS 1 USD 17 500 000 Saragol Tankers 1 DIS 1 USD 56 000 000 Saragol Tankers 2 DIS 1 USD 49 000 000 Lesley Product DIS 1 USD 2 355 000 Henrietta Product DIS 1 USD 10 400 000

11

Drybulk # Asian Bulkers DIS 3 USD 48 000 000 Golden Kamsar DIS 1 USD 67 294 000 Industrial Shipping DIS 6 EUR 34 000 000

10

Containers # Feeder Container II DIS 2 USD 15 500 000 High Yield Shipping DIS 1 USD 6 000 000 Homborsund Container DIS 1 USD 4 750 000

4

Other # MS Nordstjernen DIS 1 NOK 8 000 000 Platou Shipinvest I DIS USD

1

Total $/euro 1:1 1 049 035 250 Projects 22 Vessels 34


26

Projects' estimated returns


Clarksons Platou Project Finance Secondhand Opportunities Estimated Returns

Project Established Paid in Capital

Accumulated Dividends

Accumulated in % of Paid in Capital

Estimated Share Price per 1%

Estimated IRR Seller

Estimated IRR Buyer

Aberdeen Offshore DIS November 1, 2014 USD 7 000 000 N/A 0 % $ 120 000 4,12 % 11,32 % Bergshav Aframax February 20, 2014 USD 6 500 000 3 200 000 49 % $ 40 000 15,63 % 12,54 % Bukit Timah Offshore DIS May 1, 2008 USD 29 269 250 21 250 000 73 % $ 280 000 10,82 % 20,19 % Dongguan Chemical Tankers December 1, 2007 USD 7 150 000 4 700 000 66 % $ 48 000 4,49 % 20,63 % European Venture DIS April 1, 2008 USD 9 965 000 14 090 000 141 % $ 40 000 10,17 % 23,38 % Feeder Container DIS May 1, 2013 USD 4 300 000 6 560 000 153 % $ 57 000 20,70 % SOLD Feeder Container II DIS September 15, 2015 USD 15 525 000 650 000 4 % $ 145 000 -3,30 % 11,60 % Golden Kamsar DIS August 1, 2008 USD 23 694 000 8 500 000 36 % $ 150 000 0,00 % 20,26 % Henrietta Product DIS June 30, 2015 USD 8 400 000 1 700 000 20 % $ 82 000 12,60 % 10,30 % High Yield Shipping DIS January 1, 2014 USD 6 000 000 1 055 000 18 % $ 59 000 8,80 % 10,10 % Homborsund Container DIS June 30, 2015 USD 4 750 000 N/A 0 % $ 50 000 2,04 % 15,53 % Industrial Shipping DIS May 1, 2012 USD 5 750 000 355 515 6 % € 40 000 -29,90 % 12,72 % Lesley Product DIS October 1, 2014 USD 2 350 000 610 000 26 % $ 23 500 17,47 % 12,20 % Nordstjernen November 23, 2012 NOK 6 000 000 3 000 000 50 % kr 86 000 10,00 % 10,00 % Octavian Bulkers DIS September 1, 2010 USD 16 000 000 14 525 000 91 % $ 130 250 -2,07 % SOLD Orchard Offshore DIS March 1, 2007 USD 7 800 000 19 842 500 254 % $ 14 500 18,07 % SOLD Panda Chemical II DIS November 1, 2013 USD 1 815 000 N/A 0 % $ 25 000 13,19 % 15,78 % Saragol Tankers I DIS June 1, 2007 USD 18 500 000 N/A N/A $ 185 000 N/A 21,00 % Saragol Tankers II DIS December 1, 2007 USD 26 000 000 N/A N/A $ 260 000 N/A 20,90 % Seminyak DIS September 1, 2008 USD 36 168 000 N/A 0 % $ 60 000 N/A Selling Sentosa Offshore DIS July 1, 2007 USD 8 300 000 14 450 000 174 % $ 28 000 15,09 % 24,51 % Singapore Offshore DIS August 1, 2006 USD 7 850 000 21 118 367 269 % $ 38 000 18,56 % SOLD Southern Chemical DIS July 1, 2007 EUR 16 350 000 1 540 000 9 % $ 60 000 -11,3 % 21,82 % Sudong Offshore DIS October 1, 2013 USD 8 200 000 1 375 000 17 % $ 70 000 0,9 % 24,14 % Vestland Marine Seismic DIS February 1, 2014 USD 1 550 000 1 708 000 110 % $ 11 080 6,82 % SOLD

27

Company fleet list

Clarksons Platou Project Finance Fleet List

Project Vessel Type Vessel Name DWT/TEU/BHP/M2 Built Yard Charter Type

Aberdeen Offshore DIS PSV FS Cygnus 750m2 2014 Simek Yard, Norway BB

Asian Bulkers DIS Supramax MV Svenner 58000 2010 Dayang, China TC

Asian Bulkers DIS Supramax MV Slettnes 58000 2010 Dayang, China TC

Asian Bulkers DIS Supramax MV Svinoy 58000 2010 Dayang, China TC

Bergshav Aframax AS Aframax Tanker Stealth Berana 115000 2010 Samsung Heavy Industries TC

Blue Mountain Tankers DIS IMO II/III Product Tanker Oceanic Indigo 11000 2011 Penglai Bohai Shipyard Co. Ltd. TC

Blue Mountain Tankers DIS IMO II/III Product Tanker Oceanic Crimson 13000 2008 Jinse Co. Ltd., Korea TC

Blue Mountain Tankers DIS IMO II/III Product Tanker Oceanic Coral 13000 2008 Jinse Co. Ltd., Korea Spot

Blue Mountain Tankers DIS IMO II/III Product Tanker Oceanic Cyan 13000 2008 Jinse Co. Ltd., Korea TC

Bukit Timah Offshore DIS AHTS Swiber Else-Marie 10800 BHP 2009 China BB

Bukit Timah Offshore DIS AHTS Swiber Anne-Christine 10801 BHP 2009 China BB

Bukit Timah Offshore DIS AHTS Swiber Mary-Ann 10802 BHP 2010 China BB

Dongguan Chem. Tankers DIS IMO II Chemical Tanker Toreach Pioneer 8200 2008 Zhejiang Haifeng Shipbuilding BB

European Venture DIS PSV GSP Queen 2 x 3978 BHP 2006 Jaya Yard, Singapore BB

European Venture DIS PSV GSP King 2 x 5440 BHP 2005 Jaya Yard, Singapore BB

Feeder Container II DIS Container Feeder Vessel MV Portofino 1700 TEU 2002 Szczecin, Poland BB

Feeder Container II DIS Container Feeder Vessel MV Ponente 1700 TEU 2002 Szczecin, Poland BB

Golden Kamsar DIS Kamsarmax Golden Eclipse 79600 2010 Jinhaiwan Shipyard, China BB

Henrietta Product DIS Product Tanker Henrietta PG 9847 2001 Frisian Shyd, Netherlands BB

High Yield Shipping DIS Container Feeder Vessel MSC Positano 2300 TEU 2003 Daewoo, South Korea BB

Homborsund Container DIS Containership Dolphin Strait 1100 TEU 2003 CSC Jinling, China TC

Industrial Shipping DIS MPP Single-Decker Transforza 4117 2000 Severnav S.A, Romania BB

Industrial Shipping DIS MPP Single-Decker Transsonoro 4160 2000 Severnav S.A, Romania BB

Industrial Shipping DIS MPP Single-Decker Transrisoluto 4145 1997 Bodewes Volharding B.V Netherland BB

Industrial Shipping DIS MPP Single-Decker Transvolante 4117 2000 Severnav S.A, Romania BB

Industrial Shipping DIS MPP Single-Decker Translontano 4160 2000 Severnav S.A, Romania BB

Industrial Shipping DIS MPP Single-Decker Transdistinto 4160 2000 Severnav S.A, Romania BB

Lesley Product DIS Product Tanker Lesley PG 6249 1998 Appledore Shipbuilders, UK BB

MS Nordstjernen DIS Veteran Passenger Ship MS Nordstjernen 570 1956 Blohm & Voss, Germany BB

Panda Chemical II DIS Product Tanker Panda PG 6725 2004 Sedef Shipyard/ Istanbul BB

Saragol Tankers 1 DIS Product Tanker LR MV Luengo 73626 2007 New Century Shipbuilding Co. BB

Saragol Tankers 2 DIS Product & Crude Oil Tanker MT Mucua 114000 2008 New Times Shipbuilding BB

Seminyak DIS Chemical Tanker MT Sira 19998 2008 Japan TC

Seminyak DIS Chemical Tanker MT Simoa 40354 2004 Korea TC

Sentosa Offshore DIS AHTS Swiber Sandefjord 5000 BHP 2009 Malaysia/China BB

Southern Chemical DIS Chemical Tanker Alicudi M 40083 2004 Korea BB

Southern Chemical DIS Chemical Tanker Lipari M 3400 2002 Italy BB

Sudong Offshore DIS AHTS Lewek Swan 12240 BHP 2005 Pan United, Singapore BB

CIT-Grieg Dry bulk vessel Star Lygra 50741 2013 Hyundai Mipo BB

CIT-Grieg Dry bulk vessel Star Minerva 50741 2008 Oshima SB BB

CIT-Thor Magni Seismic Support Vessel Thor Magni 1100 2015 Besiktas, Turkey BB

CIT-Thor Modi Seismic Support Vessel Thor Modi 1100 2015 Besiktas, Turkey BB

CIT-Thor Frigg Seismic Support Vessel Thor Frigg 1100 2015 Besiktas, Turkey BB

CIT-Thor Freyja Seismic Support Vessel Thor Freyja 1100 2015 Besiktas, Turkey BB


This Market Report has been prepared by Clarksons Platou Project Finance AS (”CPPF”).The information contained herein has been obtained from sources believed to be reliable and in good faith. Although CPPF has endeavoured to present a consistent and correct picture of the projects, CPPF can not guarantee or be held financially or legally responsible for the accuracy, completeness or correctness of the information contained in this report. Please note that the estimates shown are based on estimates made by CPPF. The estimates are based on fair assumptions supported by objective data. The estimates are subject to risks, uncertainties and other factors that may cause actual events to differ materially from any anticipated development. Included in this report are various “forward-looking-statement”, including statements regarding CPPF or others intent, opinions, belief or current expectations of the projects with respect to (A) The target market, (B) evaluation of the companies' markets, competition and competitive position, (C) trends and market movements which may be expressed or implied by financial or other information or statements herein. Any reference to past performance or forward-looking-statements should not be used as a reliable indicator of future performance or future yield/return. This Market Report and its contents is the property of CPPS and CPPF and can not be distributed to any other party without the prior written consent of CPPS or CPPF.

The projects

29

KEY FIGURES (Date of analysis 30.06.2016) Project Broker: Chris W. Svensson, Corporate Manager: Eva Lise Bjerke

THE VESSEL(S)

COMMERCIAL DETAILS

INFO MEMORANDUM BASE CASE

CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: October 2014 Estimated share value per 1 % 120,000

Paid in capital: USD 17,000,000 Last reported sale pr 1 % N/A

Uncalled capital : USD 0 Estimated IRR Buyer : 11.32%

Accumulated dividends: USD N/A Estimated IRR Seller : 4.12%

Estimated Expiry: Q4 2024 Latent tax liability vessel pr. 1% 12,500

Latent tax liability debt pr. 1% 2,200

Aberdeen offshore dis

Vessel(s) name: FS CYGNUS

Type: PSV UT755 LC

DWT: 3,150 Yard: SIMEK, Flekkefjord, Norway

Built: November 2014

Class: DNV GL

Flag: British

Corporate management: Clarksons Platou Project Finance AS Disponent owner: OMP Management AS Project price: USD 34,800,000 Paid in capital: USD 17,000,000 Uncalled capital: USD 0 Bareboat charterer: Fletcher Shipping Ltd. Commencement of charter: 14 November 2014 Expiry of charter: 13 November 2021 Daily bareboat rate: USD 11,246/d

Estimated Residual: USD 26,000,000 Estimated IRR: 14%

2015 2016E 2017E 2018E 2019E Operating revenue 2,145,000 546,500 859,000 5,519,000 5,105,000 Operating expenses -657,000 -160,000 -160,000 -163,000 -165,000 Net operating cashflow 1,488,000 344,000 699,000 5,356,000 4,943,000 Purchase/Sale of vessel 0 0 0 0 0 Interest earned 0 0 0 0 1,027,000 Interest expenses -703,000 -704,000 -718,000 -695,000 -363,000 Paid in capital 0 0 0 0 0 Drawdown/ Repayment long term debt -1,576,000 -393,000 0 -3,754,000 -1,289,000 Net financial items -2,279,000 -1,097,000 -718,000 -4,449,000 -625,000 Net projected cash flow 791,000 -753,000 -19,000 907,000 4,318,000 Estimated dividend 0 0 0 0 -4,229,000

Cash USD 350,000 Implicit vessel value USD 24,970,000 Accounts Receivable USD 3,721,000 Total assets USD 29,041,000 Outstanding debt USD 16,941,000 Short term payables USD 100,000 Total outstanding debt USD 17,041,000 Estimated project value USD 12,000,000

The company aquired the newbuilding, FS Cygnus, on 14 November 2014. The vessel is fixed on a 7 year bareboat charter contract to Fletcher Shipping Ltd. After a restructuring in August 2015 the new bareboat charterer is Fletcher Supply Ships Ltd. In the restructuring agreement, the bareboat hire is paid on a pay-as-you-earn arrangement. The vessel is currently on T/C to Enquest.

Mortgage loan: 18 911 140 Balloon: 11 031 498 Term: 5 years Quarterly instalments: 393 982 Interest: LIBOR + margin of 2.95 % *Assuming refinancing after 5 years , 50% of loan is fixed at an interest of 1.77%


30

KEY FIGURES (Date of analysis 30.06.2016) Project Broker: Chris W. Svensson, Corporate Manager: Erik Kristian Andresen

THE VESSEL(S)

COMMERCIAL DETAILS


CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: October 2007 Estimated share value per 1 % N/A


Uncalled capital : USD 0 Estimated IRR Buyer : N/A

Accumulated dividends: USD N/A Estimated IRR Seller : N/A

Estimated Expiry: N/A Latent tax liability vessel pr. 1% N/A

Latent tax liability debt pr. 1% N/A

Asian Bulkers dis

Corporate management: Clarksons Platou Project Finance AS Disponent owner: Scantank AS Project price: USD 123,000,000 Paid in capital: USD 48,000,000 Uncalled capital: USD 0 Bareboat charterer: N/A Pool Operator: Klaveness Pool Expiry of charter: N/A Daily bareboat rate: USD N/A


2015 2016E 2017E 2018E 2019E Operating revenue N/A N/A N/A N/A N/A Operating expenses Net operating cashflow Purchase/Sale of vessel Interest earned Interest expenses Paid in capital Drawdown/ Repayment long term debt Net financial items Net projected cash flow Estimated dividend

Cash USD N/A Implicit vessel value USD Accounts Receivable USD Total assets USD Outstanding debt USD Short term payables USD Total outstanding debt USD Estimated project value USD

All vessels operating in the Klaveness pool. Drydocked in 2015.

Mortgage loan: 86,100,000 Balloon: 63,000,000 Term: 5 years Quarterly instalments: 1,440,000 Interest: Floating, 2.23% incl. Margin

Vessel(s) name: MV Svenner MV Slettnes MV Svinoy

Type: Supramax Bulker

Supramax Bulker

Supramax Bulker

DWT: 58,000 58,000 58,000 Yard: Dayang, China Dayang, China Dayang, China

Built: 2010 2010 2010

Class: BV BV BV

Flag: Marshall Isl. Marshall Isl. Marshall Isl.


31

KEY FIGURES (Date of analysis 30.06.2016) Project Broker: Axel M. Aas, Corporate Manager: Benjamin Ryeng-Hansen

THE VESSEL(S)

COMMERCIAL DETAILS


CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: February 2015 Estimated share value per 1 % USD 40,000



Accumulated dividends: USD 3,800,000 Estimated IRR Seller : 15.63%

Estimated Expiry: Q2 2018 Latent tax liability vessel pr. 1% N/A


Bergshav Aframax AS

Vessel(s) name: STEALTH BERANA

Type: Aframax Tanker

DWT: 115,897 Yard: Samsung HI, South Korea

Built: 2010

Class: DNV GL

Flag: Malta

Corporate management: Clarksons Platou Project Finance AS Disponent owner: Bergshav Management AS Project price: USD 6,500,000 Paid in capital: USD 6,500,000 Uncalled capital: USD 0 T/C charterer: Phillips 66 Commencement of charter: October 2015 Daily BB rate:: USD 12,900 Daily T/C rate: USD 25,150

Estimated Residual: Bareboat Estimated IRR: 73%

2015 2016E 2017E 2018E 2019E Operating revenue 3,286,000 8,745,000 8,721,000 2,287,000 Operating expenses -4,384,000 -7,382,000 -7,580,000 -1,935,000 Net operating cashflow -1,099,000 1,362,000 1,141,000 351,000 Purchase/Sale of vessel - - - - Interest earned - - - - Interest expenses 6,500,000 - - - Paid in capital -141,000 141,000 - - Drawdown/ Repayment long term debt -1,821,000 - - 1,821,000 Net financial items 4,538,000 141,000 - 1,821,000 Net projected cash flow 3,440,000 1,503,000 1,141,000 2,172,000 Estimated dividend 3,200,000 1,200,000 1,200,000 2,656,000

Bergshav Aframax AS has chartered in one Aframax Tanker on 32 months bareboat charter. The vessel is fixed on TC to Philips 66 for the remaining bareboat period. The vessel will be redelivered to owners at the end of the time charter.

Mortgage loan: 100% Equity Balloon: Term: Quarterly instalments: Interest:

Cash USD 409,000 Implicit vessel value USD 3,591,000 Total assets USD 4,000,000 Outstanding debt USD - Short term payables USD - Total outstanding debt USD - Estimated project value USD 4,000,000


32

KEY FIGURES (Date of analysis 30.06.2016) Project Broker: Chris W. Svensson, Corporate Manager: Benjamin Ryeng-Hansen

THE VESSEL(S)

COMMERCIAL DETAILS


CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: May 2008 Estimated share value per 1 % USD 280,000

Paid in capital: USD 29,269,250 Last reported sale pr 1 % USD 330,000





Bukit timah offshore dis

Corporate management: Clarksons Platou Project Finance AS Disponent owner: OMP Management AS Project price: USD 125,269,250 Paid in capital: USD 29,269,250 Uncalled capital: USD 0 Bareboat charterer: Southsea Mar. guaranteed by Swiber Commencement of charter: August 2009 – September 2010 Expiry of charter: August 2019 – September 2020 Daily BB rate: USD 3x 15,850


2015 2016E 2017E 2018E 2019E Operating revenue 17,356,000 17,403,000 17,356,000 17,356,000 15,343,000 Operating expenses -279,000 -272,000 -275,000 -278,000 -281,000 Net operating cashflow 17,077,000 17,131,000 17,081,000 17,078,000 15,062,000 Purchase/Sale of vessel - - - - 16,250,000 Interest earned 5,000 - - - 70,000 Interest expenses -5,066,000 -4,547,000 -3,854,000 -3,184,000 -2,395,000 Paid in capital - - - - - Drawdown/ Repayment long term debt -7,700,000 -7,950,000 -7,950,000 -7,950,000 -16,038,000 Net financial items -12,761,000 -12,497,000 -11,804,000 -11,134,000 -2,113,000 Net projected cash flow 4,315,000 4,634,000 5,277,000 5,944,000 12,949,000 Estimated dividend - - 16,600,000 6,100,000 13,000,000

The charterer has purchase options from year 5 to year 10. Hire is being paid, but the bank has restricted dividend payments, which has resulted in a cash position of about USD 10m.

Mortgage loan: 96,000,000 Balloon: 20,250,000 Seller's credit 6,000,000 Term: 10 Years Quarterly instalments: USD 1,987,500 Mortgage Interest: 8.3213% Incl. 3.625% margin Interest Seller's Credit 3.50%

Vessel(s) name: Swiber Anne-Christine

Swiber Mary-Ann

Swiber Else-Marie

Type: AHTS AHTS AHTS

BHP: 10,800 10,800 10,800 Yard: China China China

Built: 2009 2010 2009

Class: ABS ABS ABS

Flag: Marshall Isl. Marshall Isl. Marshall Isl.

Cash USD 10,600,000 Implicit vessel value USD 74,609,000 Total assets USD 85,209,000 Outstanding debt USD 56,559,000 Short term payables USD 650,000 Total outstanding debt USD 57,209,000 Estimated project value USD 28,000,000


33


THE VESSEL(S)

COMMERCIAL DETAILS


CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: May 2014 Estimated share value per 1 % N/A

Paid in capital: USD 49 000 000 Last reported sale pr 1 % N/A





CIT-Grieg

Vessel(s) name: Star Lygra Star Minerva

Type: Open-Hatch Bulk Carrier

Open-Hatch Bulk Carrier

DWT: 50,700 49,955 Yard: Hyundai Mipo, Korea Oshima SB

Built: 2013 2008

Class: ABS DNV GL

Flag: Cyprus Marshall Isl.

Corporate management: Clarksons Platou Project Finance AS Disponent owner: Project price: USD Paid in capital: USD Uncalled capital: USD Bareboat charterer: Grieg Shipping II AS Commencement of charter: Expiry of charter: Daily BB rate: USD

Estimated Residual: N/A Estimated IRR: N/A


Project financed in cooperation with CIT.

Mortgage loan: N/A Balloon: Term: Quarterly instalments: Interest:

Cash USD N/A Implicit vessel value USD Total assets USD Outstanding debt USD Short term payables USD Total outstanding debt USD Estimated project value USD


34


THE VESSEL(S)

COMMERCIAL DETAILS


CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: August 2014 Estimated share value per 1 % N/A

Paid in capital: USD 86 000 000 Last reported sale pr 1 % N/A





CIT-THOR

Corporate management: Clarksons Platou Project Finance AS Disponent owner: Project price: USD Paid in capital: USD Uncalled capital: USD Bareboat charterer: P/F Thor Time Charterer: PGS Geophysical AS Expiry of charter: Daily BB rate: USD



Project financed in cooperation with CIT.

Mortgage loan: N/A Balloon: Term: Quarterly instalments: Interest:

Vessel(s) name: Thor Magni Thor Modi Thor Freyja Thor Frigg

Type: Seismic Sup. Seismic Sup. Seismic Sup. Seismic Sup.

DWT: 1,750 1,750 1,750 1,750 Yard: Besiktas Besiktas Besiktas Besiktas

Built: 2014 2015 2015 2015

Class: DNV GL DNV GL DNV GL DNV GL

Flag: Bahamas Bahamas Bahamas Bahamas



35


THE VESSEL(S)

COMMERCIAL DETAILS


CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: December 2007 Estimated share value per 1 % USD 48,000


Uncalled capital : USD 3,500,000 Estimated IRR Buyer : 20.63%


Estimated Expiry: Q4 2016 Latent tax liability vessel pr. 1% USD 9,100

Latent tax liability debt pr. 1% USD 400

Dongguan chemical tankers dis

Corporate management: Clarksons Platou Project Finance AS Disponent owner: Atlantica Shipping AS Project price: USD 15,324,000 Paid in capital: USD 7,150,000 Uncalled capital: USD 3,500,000 Bareboat charterer: Toreach guaranteed by Dongguan Time Charterer: 15 October 2008 Expiry of charter: 15 October 2016 Daily BB rate: USD 5,250/day

Estimated Residual: 18,200,000 Estimated IRR: 17%

2015 2016E 2017E 2018E 2019E Operating revenue 1,916,000 1,439,000 N/A N/A N/A Operating expenses -91,000 -101,000 Net operating cashflow 1,825,000 1,337,000 Purchase/Sale of vessel - 6,500,000 Interest earned - - Interest expenses -172,000 -23,000 Paid in capital - - Drawdown/ Repayment long term debt -1,183,000 -2,735,000 Net financial items -1,354,000 3,742,000 Net projected cash flow 471,000 5,079,000 Estimated dividend 462,000 5,454,000

The bareboat charter will expire this year. The owner has an option to sell the vessel back to bareboat charterer at USD 6.5 million at end of the charter.

Mortgage loan: USD 9,000,000 Seller's Credit: USD 800,000 Balloon: USD 3,240,000 Term: 8 Years Quarterly instalments: 180,000 Mortgage 20.11.08-04.05.2012 6.54% incl. 1.5% Margin Mortgage 04.05.08-04.11.2015 5.16% incl. 1.5% Margin Interest: Seller's Credit 0%

Vessel(s) name: MT Toreach Pioneer

Type: Chemical Tanker IMO II

DWT: 8,200

Yard: Zheijang Haifeng Shipbuilding, China

Built: 2008

Class: CCS

Flag: Marshall Islands

Cash USD 428,000 Implicit vessel value USD 6,585,000 Total assets USD 7,013,000 Outstanding debt USD 2,138,000 Short term payables USD 75,000 Total outstanding debt USD 2,213,000 Estimated project value USD 4,800,000


36


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COMMERCIAL DETAILS


CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: April 2006 Estimated share value per 1 % USD 40,000






European venture DIS

Corporate management: Clarksons Platou Project Finance AS Disponent owner: North Sea Shipping AS Project price: USD 46,325,000 Paid in capital: USD 9,965,000 Uncalled capital: USD 5,000,000 Bareboat charterer: P/F Thor Charter Commencement December 2015 GSP King BB Rate Yr 1-5: 9,330/d Yr 6-8: 8,000/d GSP Queen BB Rate USD Yr 1-5: 8,715/d Yr 6-8: 7,000/d


2015 2016E 2017E 2018E 2019E Operating revenue 5,131,300 2,878,500 2,689,700 N/A N/A Operating expenses -176,000 -163,000 -169,900 Net operating cashflow 4,955,300 2,715,500 2,519,800 Purchase/Sale of vessel 0 0 8,000,000 Interest earned 200 0 0 Interest expenses -182,000 -198,000 -123,000 Paid in capital 0 0 0 Drawdown/ Repayment long term debt -4,260,000 -2,700,000 -5,090,000 Net financial items -4,441,800 2,898,000 2,787,000 Net projected cash flow 513,500 -185,500 -267,200 Estimated dividend 0 0 5,595,200

1.5 years remaining of current bareboat charter. The project was restructured q4 2015.

Mortgage loan: USD 36,360,000 Balloon: USD 13,480,000 Seller's credit USD 0 Term: 8 Years Semi-Annual instalments: USD 1,430,000 Interest: 100% Floating Interest Seller's Credit N/A

Vessel(s) name: GSP Queen GSP King

Type: AHTS, FIFI1 & DP2 AHTS, FIFI1 & DP2

BHP: 2x 3978 2x 5440 Yard: Jaya Yard, Singapore Jaya Yard, Singapore

Built: 2006 2005

Class: ABS ABS

Flag: Gibraltar Gibraltar



37

KEY FIGURES (Date of analysis 30.06.2016) Project Broker: Axel. M. Aas, Corporate Manager: Eva Lise Bjerke

THE VESSEL(S)

COMMERCIAL DETAILS


CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: May 2013 Estimated share value per 1 % N/A


Uncalled capital : USD 0 Estimated IRR Buyer : 22%

Accumulated dividends: USD 6,560,000 Estimated IRR Seller : N/A

Estimated Expiry: September 2015 Latent tax liability vessel pr. 1% N/A


Feeder container vessel dis

Corporate management: Clarksons Platou Project Finance AS Disponent owner: Atlantica Shipping AS Project price: USD 4,300,000 Paid in capital: USD 4,300,000 Uncalled capital: USD 0 Bareboat charterer: N/A Time Charterer: Hamburg Süd Expiry of charter: Spot Daily T/C rate: USD 8,600 (-5%)



Sold just prior to the current market dip, which resulted in a good price, especially when looking at her present value.

Mortgage loan: 100% Equity Seller's Credit: Balloon: Term: Quarterly instalments: Interest: Seller's Credit

Vessel(s) name: MV Credo

Type: Feeder Container Vessel

TEU: 1,728

Yard: Stocznia Szczecinska, Poland

Built: 1996

Class: GL, Germany




38

KEY FIGURES (Date of analysis 30.06.2016) Project Broker: Trond Hamre, Corporate Manager: Erik Kristian Andresen

THE VESSEL(S)

COMMERCIAL DETAILS


CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: September 2015 Estimated share value per 1 % USD 145,000



Accumulated dividends: USD 650,000 Estimated IRR Seller : -3.3%


Latent tax liability debt pr. 1% 0

Feeder container II dis

Corporate management: Clarksons Platou Project Finance AS Disponent owner: Atlantica Shipping AS Project price: USD 15,525,000 Paid in capital: USD 15,525,000 Uncalled capital: USD 0 Bareboat charterer: Seachange (20% Sub. Equity) Time Charterer: N/A Expiry of charter: 5 year BB Charter Daily BB rate: USD 2x 2,250 + P. Split above 8,100(TC)


2015 2016E 2017E 2018E 2019E Operating revenue 351,000 1,689,200 1,642,500 1,642,500 1,642,500 Operating expenses -568,900 -95,100 -111,600 -115,500 -121,100 Net operating cashflow -217,900 1,594,100 1,530,900 1,527,000 1,521,400 Purchase/Sale of vessel -15,000,000 0 0 0 0 Interest earned 0 0 0 0 0 Interest expenses 0 0 0 0 0 Paid in capital 15,525,000 0 0 0 0 Drawdown/ Repayment long term debt 0 0 0 0 0 Net financial items 525,000 0 0 0 0 Net projected cash flow 307,100 1,594,100 1,530,900 1,527,000 1,521,400 Estimated dividend 0 1,850,000 1,500,000 1,550,000 1,500,000

Bareboat with Seachange which has the vessels on shorter term T/C contracts.

Mortgage loan: 100% Equity Balloon: Seller's credit Term: Semi-Annual instalments: Interest: Interest Seller's Credit

Vessel(s) name: MV Portofino MV Ponente

Type: Container Feeder Vessel

Container Feeder Vessel

TEU: 1,700 1,700 Yard: Stocznia Szczecinska Stocznia Szczecinska

Built: 2002 2002

Class: Class NK Class NK

Flag: Singapore Singapore

Cash USD 33,500 Implicit vessel value USD 14,466,500 Total assets USD 14,500,000 Outstanding debt USD 0 Short term payables USD 0 Total outstanding debt USD 0 Estimated project value USD 14,500,000


39


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BALANCE 30.06.2016

COMMENTS

FINANCING



Uncalled capital left: USD 3,000,000 Estimated IRR Buyer : 20.26%




Golden kamsar dis

Corporate management: Clarksons Platou Project Finance AS Disponent owner: Lorentzens Skibs Management AS Project price: USD 57,500,000 Paid in capital: USD 15,194,000 Uncalled capital: USD 3,000,000 Bareboat charterer: Golden Ocean Group Ltd. Time Charterer: Cosco BB Charter: 10 years (4 years remaining) Daily BB rate Yr 5-10: USD 16,284/d


2015 2016E 2017E 2018E 2019E Operating revenue 6,558,000 5,960,000 5,944,000 5,943,000 5,943,000 Operating expenses -103,000 -107,000 -100,000 -100,000 -100,000 Net operating cashflow 6,455,000 5,853,000 5,844,000 5,843,000 5,843,000 Purchase/Sale of vessel 0 0 0 0 0 Interest earned 0 0 0 0 0 Interest expenses -551,000 -433,000 -368,000 -268,000 -169,000 Paid in capital 0 0 0 0 0 Drawdown/ Repayment long term debt -5,931,000 -2,031,000 -2,031,000 -2,031,000 -2,031,000 Net financial items -6,482,000 2,464,000 -2,399,000 -2,299,000 -2,200,000 Net projected cash flow -27,000 3,389,000 3,445,000 3,544,000 3,3643,000 Estimated dividend 0 -2,500,000 -4,509,000 -3,545,000 -3,643,000

The vessel is fixed on bareboat charter to Golden Ocean and performing a long term time charter to Cosco. The bareboat hire is paid on time. The debt was refinanced in 2014 for the remaining bareboat period.

Mortgage loan: USD 16,250,000 Balloon: USD 5,585,938 Seller's credit N/A Term: Profile of 8 years from 2014 Semi-Annual instalments: USD 507,813 Interest: LIBOR + 3.50% Interest Seller's Credit N/A

Vessel(s) name: Golden Eclipse

Type: Kamsarmax Drybulk Carrier

DWT: 79,600

Yard: Jinhaiwan Shipyard, China

Built: 2010

Class: ABS

Flag: Hong Kong



40


THE VESSEL(S)

COMMERCIAL DETAILS


CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: June 2015 Estimated share value per 1 % USD 82,000






Henrietta product dis

Corporate management: Clarksons Platou Project Finance AS Disponent owner: Seabulk AS Project price: USD 8,400,000 Paid in capital: USD 8,400,000 Uncalled capital: USD 0 Bareboat charterer: Pritchard Gordon Tankers Ltd Time Charterer: N/A BB Charter: 6 years Daily BB rate: USD 5,200/d

Obligation Residual: USD 3,000,000 Estimated IRR: 11.5%

2015 2016E 2017E 2018E 2019E Operating revenue 795,600 1,903,200 1,898,000 1,898,000 1,898,000 Operating expenses -366,100 -80,400 -82,100 -84,600 -88,100 Net operating cashflow 429,500 1,822,800 1,815,900 1,813,400 1,809,900 Purchase/Sale of vessel -8,000,000 0 0 0 0 Interest earned 0 0 0 0 0 Interest expenses 0 0 0 0 0 Paid in capital 8,400,000 0 0 0 0 Drawdown/ Repayment long term debt 0 0 0 0 0 Net financial items 400,000 0 0 0 0 Net projected cash flow 29,500 1,822,800 1,815,900 1,813,400 1,809,900 Estimated dividend 750,000 1,855,000 1,820,000 1,820,000 1,815,000

The charterer is performing well and paying hire on time. The vessel is running in the Caribbean product trade.


Vessel(s) name: Henrietta PG

Type: Product Tanker

DWT: 9,999 Yard: Frysian Shipyard, Welgelegen

Built: 2001

Class: Lloyds Register

Flag: Isle of Man



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BALANCE 30.06.2016

COMMENTS

FINANCING







High yield shipping dis

Corporate management: Clarksons Platou Project Finance AS Disponent owner: Seabulk AS Project price: USD 6,000,000 Paid in capital: USD 6,000,000 Uncalled capital: USD 0 Bareboat charterer: Med. Shipping Company (MSC) BB Expiry: 16.04.2019 BB Charter: 5 years Daily BB rate: USD 2,000/d

Purchase Obligation: USD 5,550,000 Estimated Yield: 9.5%

2015 2016E 2017E 2018E 2019E Operating revenue 750,000 750,000 720,000 720,000 202,000 Operating expenses -63,000 -62,000 -64,000 -65,000 -33,000 Net operating cashflow 687,000 688,000 656,000 655,000 169,000 Purchase/Sale of vessel - - - - 5,494,000 Interest earned - - - - - Interest expenses - - - - - Paid in capital - - - - - Drawdown/ Repayment long term debt - - - - - Net financial items - - - - 5,494,000 Net projected cash flow 687,000 688,000 656,000 655,000 5,663,000 Estimated dividend 627,000 685,000 570,000 570,000 6,070,000

The vessel is on bareboat to the 2nd largest container liner operator in the world. Financial lease with a fixed dividend coupon at 9.5% Charterer has a purchase obligation at the end of the charter period at USD 5,550,000.


Vessel(s) name: MSC Positano


TEU: 2,456

Yard: Daewoo (DSME), South Korea

Built: 1997

Class: GL

Flag: Malta

Cash USD 277,000 Implicit vessel value USD 5,643,000 Total assets USD 5,920,000 Outstanding debt USD - Short term payables USD 20,000 Total outstanding debt USD 20,000 Estimated project value USD 5,900,000


42

KEY FIGURES (Date of analysis 30.06.2016) Project Broker: Axel M. Aas, Corporate Manager: Eva Lise Bjerke

THE VESSEL(S)

COMMERCIAL DETAILS


CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: June 2015 Estimated share value per 1 % USD 50,000



Accumulated dividends: USD 0 Estimated IRR Seller : 2.04%



Homborsund container dis

Corporate management: Clarksons Platou Project Finance AS Disponent owner: Agder Ocean / Carsten Rehder Project price: USD 4,900,000 Paid in capital: USD 4,900,000 Uncalled capital: USD 0 Bareboat charterer: N/A Time Charterer: CMA CGM Time Charter Period: May/August 2016 (Options to extend) Daily T/C rate: USD 6,000/d (-4.75%)


2015 2016E 2017E 2018E 2019E Operating revenue 1,031,000 2,103,000 3,203,000 3,103,000 Operating expenses -1,234,000 -2,748,000 -2,108,000 -2,831,000 Net operating cashflow -203,000 -645,000 1,095,000 272,000 Purchase/Sale of vessel -4,400,000 0 0 5,000,000 Interest earned 0 0 0 0 Interest expenses 0 0 -37,000 0 Paid in capital 4,900,000 500,000 0 0 Drawdown/ Repayment long term debt 0 500,000 -500,000 0 Net financial items 0 0 -537,000 0 Net projected cash flow 297,000 -145,000 557,000 5,272,000 Estimated dividend 0 0 -250,000 -5,731,000

The vessel has been fixed on short term time charter to CMA CGM. The vessel is scheduled for an intermediate survey in June 2016 and dry-docking/class renewal in April/July 2018.

Mortgage loan: 100% Equity Balloon: Partner Loan: Term: Semi-Annual instalments: Interest:

Vessel(s) name: MS Dolphin Strait


TEU: 1,118 Yard: CSC Jingling Shipyard, China

Built: 2003

Class: DNV GL

Flag: Antigua & Barbuda

Cash USD 350,000 Implicit vessel value USD 5,170,000 Total assets USD 5,520,000 Outstanding debt USD 0 Short term payables USD 520,000 Total outstanding debt USD 520,000 Estimated project value USD 5,000,000


43

KEY FIGURES (Date of analysis 30.06.2016) Project Broker: Axel M. Aas, Corporate Manager: Erik Kristian Andresen

THE VESSEL(S)

COMMERCIAL DETAILS


CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: May 2012 Estimated share value per 1 % EUR 40,000

Paid in capital: EUR 10,894,485 Last reported sale pr 1 % EUR 42,000

Uncalled capital : EUR 0 Estimated IRR Buyer : 12.72%

Accumulated dividends: EUR 355,000 Estimated IRR Seller : -29.9%



Industrial shipping dis

Corporate management: Clarksons Platou Project Finance AS Disponent owner: Norwegian Marine Services Project price: EUR 25,950,000 Paid in capital: EUR 10,894,485 Uncalled capital: EUR 0 Bareboat charterer: Transatlantic Short Sea Bulk AB Time Charterer: N/A BB Charter: 5 years Daily BB rate: EUR 699/d

Estimated Residual: EUR 5,000,000 Estimated IRR: 23%

2015 2016E 2017E 2018E 2019E Operating revenue 1,360,000 1,965,000 1,545,500 1,545,500 512,300 Operating expenses -267,800 -160,400 -96,100 -100,200 -64,700 Net operating cashflow 1,092,200 1,804,600 1,449,400 1,445,300 447,600 Purchase/Sale of vessel 2,137,000 0 0 0 6,000,000 Interest earned 75 55 0 0 0 Interest expenses -545,900 -424,300 -347,700 -292,500 -181,600 Paid in capital 0 0 0 0 0 Drawdown/ Repayment long term debt -2,616,300 -1,229,700 -1.069.400 -1,123,900 -5,080,300 Net financial items -1,025,125 -1,653,945 -1.417.100 -1,416,400 738,100 Net projected cash flow 67,075 150,655 32,300 28,900 1,185,700 Estimated dividend 0 0 0 0 1,971,185

The project has been restructured several times. The vessels are currently fixed on 5 years BB charters to Transatlantic Short Sea Bulk AB with profit split.

Mortgage loan: EUR 11,225,000 Balloon: EUR 5,618,480 Seller's credit N/A Term: 5 Years Quarterly instalments: EUR 280,326 Interest: 5% Interest Seller's Credit N/A

Vessel(s) name:

Transforza & Volante

Sonoro +2 sisters

Transbrilliant SOLD Transrisoluto

Type: MPP MPP MPP MPP

DWT: 4,117 4,110/4,135 5,557 4,145 Yard: Severnav Severnav Ferus Smith Bodes Volhard

Built: 2000 2000 1997 1997

Class: DNV GL DNV GL DNV GL DNV GL

Flag: Gibraltar Gibraltar Gibraltar Gibraltar

Cash EUR 702,355 Implicit vessel value EUR 11,086,369 Total assets EUR 11,788,724 Outstanding debt EUR 7,788,724 Short term payables EUR 0 Total outstanding debt EUR 7,788,724 Estimated project value EUR 4,000,000


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THE VESSEL(S)

COMMERCIAL DETAILS


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BALANCE 30.06.2016

COMMENTS

FINANCING

Established: December 2014 Estimated share value per 1 % USD 23,500



Accumulated dividends: USD 610,000 Estimated IRR Seller : 17.47%



Lesley product dis

Corporate management: Clarksons Platou Project Finance AS Disponent owner: Seabulk AS Project price: USD 2,355,000 Paid in capital: USD 2,355,000 Uncalled capital: USD 0 Bareboat charterer: Pritchard Gordon Tankers Ltd Time Charterer: N/A BB Charter: 5 years Daily BB rate: USD 1,700/d


2015 2016E 2017E 2018E 2019E Operating revenue 620,500 622,200 620,500 620,500 567,800 Operating expenses -122,800 -99,500 -101,500 -105,000 -110,000 Net operating cashflow 497,700 522,700 519,000 515,500 457,800 Purchase/Sale of vessel 0 0 0 0 1,100,000 Interest earned 20 100 100 100 100 Interest expenses 0 0 0 0 0 Paid in capital 0 0 0 0 0 Drawdown/ Repayment long term debt 0 0 0 0 0 Net financial items 20 100 100 100 1,100,100 Net projected cash flow 497,720 522,800 519,100 515,600 1,557,900 Estimated dividend 510,000 530,000 520,000 510,000 1,628,100

The charterer is performing well and paying hire on time. The vessel is running in the Caribbean product trade.

Mortgage loan: 100% Equity Balloon: Partner Loan: Term: Semi-Annual instalments: Interest:

Vessel(s) name: Lesley PG


DWT: 6,249 Yard: Appledore Shipbuilders, UK

Built: 1998


Flag: Isle of Man



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THE VESSEL(S)

COMMERCIAL DETAILS


CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: Dec 15 (Refinanced) Estimated share value per 1 % NOK 86,000

Paid in capital: NOK 9,900,000 (Incl. Q1 '16 Loan of 4m) Last reported sale pr 1 % N/A

Uncalled capital : NOK 0 Estimated IRR Buyer : 10%

Accumulated dividends: NOK 3,500,000 (Incl. Pre-refinancing dividends) Estimated IRR Seller : 10%



MS nordstjernen dis

Corporate management: Clarksons Platou Project Finance AS Disponent owner: N/A Project price: NOK 8,350,000 Paid in capital: NOK 8,350,000 Uncalled capital: NOK 0 Bareboat charterer: Indre Nordhordaland Dampbåtlag AS Time Charterer: Hurtigruten BB Charter: 5 years (Purchase oblig., NOK 5m) Daily BB rate: NOK 4,600/d

Estimated Residual: NOK 5,000,000 Estimated IRR: 10%

2015 2016E 2017E 2018E 2019E Operating revenue 1,281,000 2,422,100 1,934,500 1,934,500 1,939,800 Operating expenses -243,600 -669,700 -220,000 -226,500 -233,400 Net operating cashflow 1,037,400 1,752,400 1,714,500 1,708,000 1,706,400 Purchase/Sale of vessel 0 0 0 0 0 Interest earned 0 0 0 0 0 Interest expenses 0 0 0 0 0 Paid in capital 0 4,350,000 0 0 0 Drawdown/ Repayment long term debt 0 -4,000,000 0 0 0 Net financial items 0 350,000 0 0 0 Net projected cash flow 1,037,400 2,102,400 1,714,500 1,708,000 1,706,400 Estimated dividend 1,045,000 1,900,000 1,650,000 1,700,000 1,700,000

The project was restructured as a result of a new 5 year T/C contract with Hurtigruten where an additional NOK 4.35m where sourced as a loan to INDL.


Vessel(s) name: MS Nordstjernen

Type: Veteran Passenger Ship

PAX: 114 beds in 54 cabins

Yard: Voss & Blohm, Germany

Built: 1956

Class: DNV GL

Flag: Norway

Cash NOK 175,900 Implicit vessel value NOK 8,424,100 Total assets NOK 8,600,000 Outstanding debt NOK 0 Short term payables NOK 0 Total outstanding debt NOK 0 Estimated project value NOK 8,600,000


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BALANCE 30.06.2016

COMMENTS

FINANCING

Established: September 2010 Estimated share value per 1 % N/A




Sold: October 2015 Latent tax liability vessel pr. 1% N/A


Octavian bulker dis

Corporate management: Clarksons Platou Project Finance Disponent owner: Scantank AS Project price: USD 36,000,000 Paid in capital: USD 16,000,000 Uncalled capital: USD 0 Bareboat charterer: N/A Time Charterer: Hanjin Shipping Co. Ltd BB Charter: 5 years Daily BB rate: USD 15,500/d


2015 2016E 2017E 2018E 2019E Operating revenue N/A Operating expenses Net operating cashflow Purchase/Sale of vessel Interest earned Interest expenses Paid in capital Drawdown/ Repayment long term debt Net financial items Net projected cash flow Estimated dividend

The vessel was sold in October 2015 and the company is under liquidation.

Mortgage loan: N/A Balloon: Partner Loan: Term: Semi-Annual instalments: Interest:

Vessel(s) name: MV Skomvaer

Type: Supramax Bulk Carrier

DWT: 58,000 Yard: Dayang, China

Built: 2010

Class: BV I




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COMMERCIAL DETAILS


CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: March 2007 Estimated share value per 1 % N/A




Sold: January 2016 Latent tax liability vessel pr. 1% N/A


Orchard offshore dis

Corporate management: Clarksons Platou Project Finance AS Disponent owner: OMP Management AS Project price: USD 43,800,000 Paid in capital: USD 7,800,000 Uncalled capital: USD 2,125,000 Bareboat charterer: Swiber Offshore (Mother guarantee) Time Charterer: N/A BB Charter: 8 years Daily BB rate: USD 3,150/d & 4,950/d


2015 2016E 2017E 2018E 2019E Operating revenue 2,300,000 353,000 Operating expenses -184,000 -137,000 Net operating cashflow 2,116,000 215,000 Purchase/Sale of vessel - 8,500,000 Interest earned - - Interest expenses -375,000 -64,000 Paid in capital - - Drawdown/ Repayment long term debt -880,000 -8,600,000 Net financial items -1,255,000 -164,000 Net projected cash flow 861,000 51,000 Estimated dividend - 1,501,500

Swiber executed their purchase options on the last two vessels at USD 8.5m enbloc. The two larger vessels "Swiber Ada" and "Swiber Torunn" were sold in 2014 at USD 21.5m.

Mortgage loan: N/A Balloon: Seller's credit Term: Semi-Annual instalments: Interest: Interest Seller's Credit

Cash NOK N/A Implicit vessel value NOK Total assets NOK Outstanding debt NOK Short term payables NOK Total outstanding debt NOK Estimated project value NOK

Vessel(s) name:

Swiber Navigator

Swiber Explorer

Swiber Ada

Swiber Torunn

Type: AHT AHT AHT AHT

BHP: 4,000 4,000 5,000 5,000 Yard: Malaysia Malaysia Malaysia Malaysia

Built: 2008 2008 2008 2008

Class: ABS ABS BV BV

Flag: Singapore Singapore Singapore Singapore


48

KEY FIGURES (Date of analysis 30.06.2016) Project Broker: Trond Hamre, Corporate Manager: Eva Lise Bjerke

THE VESSEL(S)

COMMERCIAL DETAILS


CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: November 2013 Estimated share value per 1 % USD 25,000



Accumulated dividends: USD 0 Estimated IRR Seller : 13.19%


Latent tax liability debt pr. 1% 0.00

Panda chemical II dis

Corporate management: Clarksons Platou Project Finance AS Disponent owner: Havinvest AS Project price: USD 4,315,000 Paid in capital: USD 1,815,000 Uncalled capital: USD 2,000,000 Bareboat charterer: Pritchard Gordon Tankers Ltd Time Charterer: N/A BB Charter: 4 years Daily BB rate: USD 1,500/d


2015 2016E 2017E 2018E 2019E Operating revenue 547,500 633,000 638,000 53,000 Operating expenses -87,000 -103,000 -108,000 -55,000 Net operating cashflow 460,500 530,000 530,000 -2,000 Purchase/Sale of vessel 0 0 0 4,250,000 Interest earned 0 0 0 0 Interest expenses -132,000 -116,000 -101,000 -22,500 Paid in capital 0 0 0 0 Drawdown/ Repayment long term debt -250,000 -250,000 -250,000 -1,500,000 Net financial items -382,000 -366,000 -351,000 -1,522,500 Net projected cash flow 78,000 164,000 180,000 2,726,000 Estimated dividend 0 -139,000 -176,000 -2,913,000

The charterer is performing well and paying hire on time. The vessel is engaged in bunkering activities in the Caribbean.

Mortgage loan: USD 2,500,000 Balloon: USD 2,000,000 Seller's credit N/A Term: 2 Years Semi-Annual instalments: USD 62,500 Interest: LIBOR + 5.75%

Vessel(s) name: Panda PG


DWT: 6,725 Yard: Sedelf Shipyard, Istanbul

Built: 2004

Class: BV

Flag: Isle of Man



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COMMERCIAL DETAILS


CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: July 2010 Estimated share value per 1 % N/A






Saragol tankers 1 dis

Corporate management: Clarksons Platou Project Finance AS Disponent owner: N/A Project price: USD 47,000,000 Paid in capital: USD 8,491,500 Uncalled capital: USD 0 Bareboat charterer: Sonangol Shipping Angola LTDA Time Charterer: N/A BB Charter: 5+5 years Daily BB rate Yr 6-10: USD 14,750/d (-2,5%)



The vessel was originally fixed on a bareboat charter for 5 years until 19 July 2015. The contract has been extended for another 5 years. The mortgage loan was settled in 2015 by way of a shareholder´s loan.

Mortgage loan: USD 30,500,000 Balloon: USD 0 Seller's credit N/A Term: 5+5 Years Quarterly instalments: N/A Interest: N/A Interest Seller's Credit N/A

Vessel(s) name: MV Luego

Type: LR2 Product Tanker

DWT: 73,626

Yard: New Century Shipbuilding China

Built: 2007

Class: ABS

Flag: The Republic of Liberia



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BALANCE 30.06.2016

COMMENTS

FINANCING

Established: November 2010 Estimated share value per 1 % N/A






Saragol tankers 2 dis

Corporate management: Clarksons Platou Project Finance AS Disponent owner: N/A Project price: USD 54,312,500 Paid in capital: USD 11,118,500 Uncalled capital: USD 0 Bareboat charterer: Sonangol Shipping Angola LTDA Time Charterer: N/A BB Charter: 5+5 years Daily BB rate Yr 6-10: USD 17,500/d



The vessel was originally fixed on a bareboat charter for 5 years until 15 December 2015. The contract has been extended for another 5 years. The mortgage loan was settled in 2015 by way of a shareholder´s loan.

Mortgage loan: USD 35,500,000 Balloon: USD 0 Seller's credit N/A Term: 5+5 Years Quarterly instalments: N/A Interest: N/A

Vessel(s) name: MT Mucua

Type: Aframax Tanker

DWT: 114,000 Yard: New Times Shipbuilding China

Built: 2008

Class: ABS

Flag: Cyprus



51


THE VESSEL(S)

COMMERCIAL DETAILS


CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: September 2008 Estimated share value per 1 % N/A



Accumulated dividends: USD 0 Estimated IRR Seller : N/A



Seminyak dis

Corporate management: Clarksons Platou Project Finance AS Disponent owner: Klaveness Marine Holding AS Project price: USD 105,750,000 Paid in capital: USD 32,618,000 Uncalled capital: USD 0 Bareboat charterer: NAVIG8 POOL Time Charterer: N/A BB Charter: N/A Daily BB rate: USD N/A


2015 2016E 2017E 2018E 2019E Operating revenue 11,688,000 N/A Operating expenses -5,400,000 Net operating cashflow 6,288,000 Purchase/Sale of vessel - Interest earned - Interest expenses -1,272,000 Paid in capital - Drawdown/ Repayment long term debt -7,958,000 Net financial items -9,230,000 Net projected cash flow -2,942,000 Estimated dividend -

Both vessels currently operating in the Navig8 pool. The vessels are in the process of being sold.

Mortgage loan: USD 73,500,000 Balloon: USD 14,000,000 Seller's credit USD 16,920,000 Term: 12 Years Quarterly instalments: USD 1,239,583 Interest: LIBOR + 2.0% Interest Seller's Credit 3%


Vessel(s) name: MT Sira MT Simoa

Type: Chemical Tanker Chemical Tanker

DWT: 19,998 40,354 Yard: Shin Kurushima, JP Hyundai Mipo, Korea

Built: 2008 2004

Class: NKK DNV GL

Flag: Marshall Islands Marshall Islands


52


THE VESSEL(S)

COMMERCIAL DETAILS


CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: July 2007 Estimated share value per 1 % USD 28,000






sentosa offshore dis

Corporate management: Clarksons Platou Project Finance AS Disponent owner: OMP Management AS Project price: USD 46,350,000 Paid in capital: USD 8,300,000 Uncalled capital: USD 0 Bareboat charterer: Swiber Offshore (Parent guarantee) Time Charterer: N/A BB Charter: 8 years Daily BB rate: USD 3,150/d & 4,950/d


2015 2016E 2017E 2018E 2019E Operating revenue 4,486,000 2,756,000 1,202,000 Operating expenses -205,000 -204,000 -166,000 Net operating cashflow 4,281,000 2,551,000 1,035,000 Purchase/Sale of vessel - 10,000,000 6,500,000 Interest earned - - - Interest expenses -789,000 -472,000 -270,000 Paid in capital - - - Drawdown/ Repayment long term debt -2,050,000 -8,375,000 -4,181,000 Net financial items -2,838,000 1,153,000 2,048,000 Net projected cash flow 1,442,000 3,705,000 3,084,000 Estimated dividend 1,550,000 4,400,000 3,441,000

The charterer has purchase options from after year 5 to year 8 for Swiber Gallant and Swiber Valiant, these have now been lifted for USD 10m enbloc. The charterer purchased Swiber Oslo on 1 August 2014. Hire is being paid on time, and the project is running well. Only Swiber Sandefjord left on charter until Q4 2017.

Mortgage loan: USD 36,000,000 Balloon: USD 13,400,000 Seller's credit USD 2,000,000 Term: 8 Years Quarterly instalments: USD 706,250 Interest: Average 5.85% incl. 1.25% Margin Interest Seller's Credit 3.50%


Vessel(s) name:

Swiber Galiant

Swiber Valiant

Swiber Sandefjord

Swiber Oslo

Type: AHT AHT AHTS AHTS

BHP: 5,000 5,000 5,000 5,000 Yard: Malaysia Malaysia Malaysia Malaysia

Built: 2007 2007 2009 2009

Class: DNV GL DNV GL BV BV



53


THE VESSEL(S)

COMMERCIAL DETAILS


CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: August 2006 Estimated share value per 1 % N/A




Estimated Expiry: February 2016 Latent tax liability vessel pr. 1% N/A


singapore offshore dis

Corporate management: Clarksons Platou Project Finance AS Disponent owner: Klaveness Marine Holding AS Project price: USD 129,100,000 Paid in capital: USD 7,850,000 Uncalled capital: USD 0 Bareboat charterer: Emas Offshore Pte. Ltd Time Charterer: N/A BB Charter: 8 years Daily BB rate: USD 37,490 net p.d.



The Charterer has paid BB hire on time and the project has been in compliance with the loan agreement throughout the BB period. Two vessels were sold in Q2 14. One vessel was sold in Q2 2015. The purchase option for Lewek Kea and Trogon has been exercised and redelivered.

Mortgage loan: N/A Balloon: Seller's credit Term: Quarterly instalments: Interest: Interest Seller's Credit


Vessel(s) name:

Lewek Trogon

Lewek Petrel & Plower

Lewek Penguin

Lewek Kea

Type: AHTS AHTS AHTS AHTS

BHP: 18,000 12,000 12,000 8,000 Yard: Pan-United Pan-United Pan-United Cheoy Lee

Built: 2008 2008 2007 2008

Class: ABS ABS ABS Lloyds



54


THE VESSEL(S)

COMMERCIAL DETAILS


CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: July 2007 Estimated share value per 1 % EUR 60,000

Paid in capital: EUR 14,810,000 Last reported sale pr 1 % EUR 52,914

Uncalled capital : EUR 4,000,000 Estimated IRR Buyer : 21.82%

Accumulated dividends: EUR 1,540,000 Estimated IRR Seller : -11.34%



Southern chemical dis

Corporate management: Clarksons Platou Project Finance AS Disponent owner: Bergshav Management AS Project price: EUR 88,200,000 Paid in capital: EUR 10,350,000 Uncalled capital: EUR 10,000,000 Bareboat charterer: Augusta Due SRL Time Charterer: N/A BB Charter: 10+2 years Daily BB rate: EUR 8,370/d & 3,750/d.

Estimated Residual: EUR 54,750,000 Estimated IRR: 14.5%

2015 2016E 2017E 2018E 2019E Operating revenue 4,423,000 4,435,000 4,424,000 4,424,000 3,418,000 Operating expenses -396,000 -214,000 -217,000 -219,000 -322,000 Net operating cashflow 4,028,000 4,221,000 4,207,000 4,205,000 3,096,000 Purchase/Sale of vessel 0 0 0 0 12,000,000 Interest earned 0 0 0 0 0 Interest expenses -1,488,000 -1,297,000 -901,000 -86,000 -23,000 Paid in capital 0 0 0 0 0 Drawdown/ Repayment long term debt -4,490,000 -2,490,000 -4,490,000 -2,490,000 -5,910,000 Net financial items -5,978,000 -3,787,000 -4,891,000 -2,576,000 -5,933,000 Net projected cash flow 1,950,000 435,000 684,000 1,628,000 9,162,000 Estimated dividend 0 0 0 0 12,200,000

The company and bareboat charterer have agreed to extend the bareboat charter for a further two years from October 2017 to October 2019. The bareboat rates are reduced effective from 2015. The mortgage loan and the sellers credit are extended accordingly

Mortgage loan: EUR 69,200,000 Balloon: EUR 1,500,000 Seller's credit EUR 8,650,000 Term: 10+2 Years

Quarterly instalments: EUR Alicudi: 415,000 & Lipari: 207,500

Interest: 5.5125%

Cash EUR 1,840,000 Implicit vessel value EUR 18,110,000 Total assets EUR 19,950,000 Outstanding debt EUR 13,635,000 Short term payables EUR 315,000 Total outstanding debt EUR 13,950,000 Estimated project value EUR 6,000,000

Vessel(s) name: Alicudi M Lipari M Gelso M

(Total Loss)

Type: Chemical Tanker Chemical Tanker Chemical Tanker

DWT: 40,083 3,400 18,000 Yard: Shina, Korea Cant Nav, Italy Turkey

Built: 2004 2002 2008

Class: Italiano Navale Italiano Navale Italiano Navale

Flag: Italy Italy Italy


55


THE VESSEL(S)

COMMERCIAL DETAILS


CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: October 2013 Estimated share value per 1 % USD 70,000






Sudong offshore dis

Corporate management: Clarksons Platou Project Finance AS Disponent owner: OMP Management AS Project price: USD 26,000,000 Paid in capital: USD 8,200,000 Uncalled capital: USD 0 Bareboat charterer: Ezra (Guaranteed by Emas Offshore) Time Charterer: N/A BB Charter: 10 + 2 years Daily BB rate: USD 9,200/d


2015 2016E 2017E 2018E 2019E Operating revenue 3,358,000 2,815,200 2,263,000 2,815,000 3,358,000 Operating expenses -135,250 -146,200 -141,900 -290,000 -142,400 Net operating cashflow 3,222,750 2,669,000 2,121,100 2,525,000 3,215,600 Purchase/Sale of vessel 0 0 0 0 0 Interest earned 8 25 25 2,600,000 25 Interest expenses -524,000 -458,000 -384,500 -353,900 -323,500 Paid in capital 0 0 0 0 0 Drawdown/ Repayment long term debt -1,666,700 -1,666,700 -1,666,700 -1,666,700 -1,666,700 Net financial items -2,190,692 -2,124,675 -2,051,175 579,400 -1,990,175 Net projected cash flow 1,032,058 544,325 69,925 1,945,600 1,225,425 Estimated dividend 475,000 0 0 3,975,000 1,375,000

Ezra debt under restructuring, and the bareboat agreement is under renegotiation and is expected to be agreed by the end of June. The hire is being paid on time. .

Mortgage loan: USD 15,000,000 Balloon: USD 0 Seller's credit USD 2,500,000 Term: 9 Years Quarterly instalments: N/A Interest: Fixed Interest Seller's Credit N/A


Vessel(s) name: MV Lewek Swan

Type: AHTS

DWT: 12,240 Yard: Pan-Limited Shipyard

Built: 2005


Flag: Panama


56


THE VESSEL(S)

COMMERCIAL DETAILS


CASHFLOW FORECASTS

BALANCE 30.06.2016

COMMENTS

FINANCING

Established: February 2014 Estimated share value per 1 % N/A






Vestland marine seismic dis

Corporate management: Clarksons Platou Project Finance AS Disponent owner: N/A Project price: USD 1,550,000 Paid in capital: USD 1,550,000 Uncalled capital: USD 0 Bareboat charterer: Grand Ocean Ship. (Vestland Marine) Time Charterer: N/A BB Charter: 3 years Daily BB rate: USD 1,000/d pre employment, then 2,000/d

Estimated Residual: USD 1,550,000 Estimated IRR: 25-30%

2015 2016E 2017E 2018E 2019E Operating revenue - 854,000 Operating expenses -38,000 -18,000 Net operating cashflow -38,000 836,000 Purchase/Sale of vessel - 296,000 Interest earned - - Interest expenses - - Paid in capital - - Drawdown/ Repayment long term debt - - Net financial items - 296,000 Net projected cash flow -38,000 1,132,000 Estimated dividend - 1,110,000

The vessel has been sold and the project is under liquidation. On a dollar basis, the return was 7%, however, being presented with an option price in NOKs the result is stated in kroner.

Mortgage loan: N/A Balloon: Seller's credit Term: Quarterly instalments: Interest:


Vessel(s) name: Geo Searcher

Type: 2D Seismic Vessel

DWT: 1,083 Yard: Salthammer Båtbyggeri

Built: 1982

Class: RINA

Flag: Malta


57

Platou shipinvest I DIS

PLATOU SHIPINVEST I DIS

Asset Manager: Trond Hamre Established: October 2007

PROJECT PORTFOLIO

VESSELS AND CHARTERS

Project No of vessels Segment Built Charterer Type charter End of charter

Dongguan Chemical Tankers DIS 1 Chemical 2008 Dongguan Fenghai Ocean Shipping Bareboat 2016 European Venture DIS 2 AHTS-Offshore 2005/06 Group Servicii Petroliere Bareboat 2017 Industrial Shipping DIS 6 MPP-Dry bulk 1997-2000 TransAtlantic Short Sea Bulk AB Bareboat 2019 Southern Chemical DIS 2 Chemical 2002/04 Augusta Due SRL Bareboat 2019 Total 11

PROJECT SHARES AND DIVERSIFICATION Project Currency Share in project Invested per 1 % Invested Share in portfolio Sold Agder Ocean Reefer KS USD 20,0% 81 685 1 633 690 3,2% Apr. 12 Agder Ocean Reefer II DIS USD 41,0% 69 195 2 837 000 5,6% Dec. 10 Bergshav Chemical KS EUR 7,0% 89 105 623 735 1,6% Jan. 12 Bukit Timah Offshore DIS USD 15,0% 292 700 4 390 500 8,7% Jun. 14 Celine I OBO DIS USD 6,0% 15 000 90 000 0,2% Feb. 08 Cement Ship II DIS USD 7,0% 66 000 462 000 0,9% Jan. 13 Chem Cosmos DIS USD 20,0% 116 339 2 326 789 4,6% Mar. 10 Chem Lily DIS USD 35,5% 133 816 4 750 475 9,4% Oct. 09 Dongguan Chemical Tankers DIS USD 5,0% 71 500 357 500 0,7% European Venture DIS USD 8,0% 120 000 960 000 1,9% European Venture II DIS USD 2,0% 40 150 80 300 0,2% Jun. 10 European Venture III DIS USD 18,0% 57 200 1 029 600 2,0% Oct. 14 Global Cable KS USD 5,5% 35 000 192 500 0,4% Jul. 10 Global Cable II DIS USD 14,0% 103 786 1 453 000 2,9% Feb. 14 Golden Kamsar DIS USD 20,0% 231 000 4 620 000 9,2% Jun. 16 Industrial Shipping DIS EUR 10,0% 57 500 575 000 1,1% Marineline Chemical DIS USD 10,0% 187 100 1 871 000 3,7% Jul 14 Med Ethylene DIS USD 1,0% 67 000 67 000 0,1% Dec. 14 Multipurpose Bulkers DIS EUR 11,0% 68 227 750 500 1,9% May. 12 RTS Panamax DIS USD 10,5% 51 000 535 500 1,1% May. 08 Norwegian Product DIS USD 15,5% 108 500 1 681 750 3,3% Dec 14 Oceanlink Offshore DIS USD 2,5% 26 500 66 250 0,1% Sep. 10 Oceanlink Offshore II DIS USD 4,5% 24 400 109 800 0,2% Sep. 10 Oceanlink Offshore III DIS USD 10,0% 48 450 484 500 1,0% Oct. 13 Oceanlink Reefer III DIS USD 6,0% 52 000 312 000 0,6% Dec 12 Orchard Offshore DIS USD 7,0% 90 000 630 000 1,2% Feb. 16 Panda Chemical Oil DIS USD 32,5% 63 500 2 063 750 4,1% Jan. 14 Panda Chemical II DIS USD 25,0% 18 150 453 750 0,9% Jan. 16 Pantheon Chemical DIS EUR 20,0% 36 775 735 500 1,9% Mar. 10 Raffles Offshore DIS USD 15,0% 140 000 2 100 000 4,2% Jun. 13 Ross Chemical II DIS USD 4,0 % 298000 1 192 000 2,4% Dec. 09 Ross Chemical IV DIS USD 20,0% 130 000 2 600 000 5,2% Dec. 10 SBS Tempest KS NOK 10,0% 370 000 3 700 000 1,2% Jun. 11 SBS Torrent KS NOK 8,5% 386 000 3 281 000 1,1% Oct 14 SBS Typhoon KS NOK 20,0% 425 000 8 500 000 2,8% May 14 Scandinavian Bulkers KS EUR 6,0% 63 250 379 500 1,0% Jan. 10 Short Sea Bulkers DIS EUR 20,0% 55 500 1 110 000 2,9% May. 12 Southern Chemical DIS EUR 12,5% 166 660 2 083 250 5,4% Western Chemical KS EUR 3,0% 106 000 318 000 0,8% Dec. 11 Total (USD equivalent) 50 478 951 100 %


58

Platou shipinvest I DIS

Offshore 18%

Chemical 61%

Dry Bulk 21%

Segment diversification

Charter duration

2016 2017 2018 2019 2020 2021

Platou Shipinvest horizon

Dongguan Chem.Tankers DIS

European Venture DIS

Industrial Shipping DIS

Southern Chemical DIS


59

Head office

Clarksons Platou Project Finance AS

Munkedamsveien 62 C

0270 Oslo, Norway

www.clarksons.com

Phone:

+47 23 11 20 00 Fax:

+47 23 11 23 27 Email:

[email protected]

Clarksons Platou Project Sales AS

Phone:

+47 23 11 20 00 Fax:

+47 23 11 23 27 Email:

[email protected]

Clarksons Platou Investor Services AS

Phone:

+47 23 11 20 00 Fax:

+47 23 11 23 27 Email:

[email protected]


60

Contact

Axel Moltzau Aas Joint Managing Partner Dir tel.: +47 23 11 28 06 Mobile: +47 97 98 21 35 Email: [email protected]

Chris W. Svensson Joint Managing Partner Dir tel.: +47 23 11 28 07 Mobile: +47 95 18 96 49 Email: [email protected]

Trond Hamre Senior Partner Dir tel.: +47 23 11 28 09 Mobile: +47 92 88 76 50 Email: [email protected]

Truls Wiese Kolstad Project Broker Dir tel.: +47 23 11 28 15 Mobile: +47 93 04 84 33 Email: [email protected]

Lars Gjerde Head of Sales Dir tel.: +47 23 11 28 08 Mobile: +47 92 06 12 85 Email: [email protected]

Stian Skaug-Paulsen Senior Broker Dir tel.: +47 23 11 28 18 Mobile: +47 93 05 59 27 Email: [email protected]

Andreas W. Bang Broker Dir tel.: +47 23 11 28 17 Mobile: +47 40 45 50 41 Email: [email protected]

Lars Gjørvad Head of Compliance Dir tel.: +47 23 11 28 24 Mobile: +47 40 92 11 51 Email: [email protected]

Håkon Frederic Røsaker Project Broker Dir tel.: +47 23 11 28 05 Mobile: +47 93 02 96 24 Email: [email protected]

Benjamin Ryeng-Hansen Managing Director Dir tel.: +47 23 11 26 68 Mobile: +47 97 71 87 04 Email: [email protected]

Heidi Meyer Westby Office Manager Dir tel.: +47 23 11 28 12 Mobile: +47 93 40 20 02 Email: [email protected]

Eva Lise Bjerke Corporate Manager Dir tel.: +47 23 11 26 05 Mobile: +47 90 96 37 57 Email: [email protected]

Erik Kristian Andresen Corporate Manager Dir tel.: +47 23 11 28 54 Mobile: +47 92 42 06 18 Email: [email protected]

Elisabeth Relbo Secretary Dir tel.: +47 23 11 28 14 Mobile: +47 99 42 17 06 Email: [email protected]

Kristin Vollan Managing Director Dir tel.: +47 23 11 26 59 Mobile: +47 95 74 78 15 Email: [email protected]

Julie Melgaard Ranvig Accountant Dir tel.: +47 23 11 26 66 Mobile: +47 93 23 37 80 Email: [email protected]

Project Finance

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