Natural Gas Options & Implications: Bridging High Energy Costs

1. Natural Gas Options & Implications:Bridging High Energy Costs SWAMC March 5, 2014 Anchorage, Alaska

2. Board Members: • Chairman, Dave Cobb – City of Valdez • Vice-Chairman, Bert Cottle– City of Valdez • Secretary, Steve Haagenson– Fairbanks North Star Borough • Treasurer, Merrick Peirce – Fairbanks North Star Borough • Board Member, Dave Dengel– City of Valdez • Board Member, Jim Whitaker – Fairbanks North Star Borough • Project Manager / General Counsel, Bill Walker – Walker Richards, LLC

7. LNG from Alaska is the Closest North American LNG to Asian Markets

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10. Are Asian Markets Interested in Alaska’s LNG?

11. Letters of Intent for Asian Market signed with AGPA East-West Power Co. Ltd. (Korea)GS Energy (Korea) POSCO (Korea) KOGAS (Korea) PTT International (Thailand)PGN LNG (Indonesia)

12. POSCO is one of the world’s largest steel plants. • POSCO power is the largest private power plant in Korea. “POSCO is ready to discuss with AGPA to define the terms and conditions for our participation in the Valdez LNG Project.” June 2012

13. Since founding in 1983, it has grown to become the world’s largest LNG importer. • KOGAS is committed to providing clean, safe and convenient energy to the people of Korea. • KOGAS currently operates three LNG terminals and a nationwide pipeline network spanning 3,022 km in order to ensure stable supply for the nation. • KOGAS imports LNG from around the world and supplies it to power generation plants, gas-utility companies and city gas companies. • KOGAS received the sovereign credit rating of A1 and A, the highest credit rating ever given to a Korean company by the Moody’s and S&P. “I look forward to a joint journey together with AGPA for the success of the project.” June 2012

14. AGPA’s Aggregated Volume for ExxonMobil’s Non-Binding Solicitation of Interest KOGAS (Korea) POSCO (Korea) GS Energy (Korea) PTT International (Thailand) PGN LNG (Indonesia) East-West Power Co. Ltd. (Korea) Total Export: 2.8 bcf/d In-state: .250 mcf Total 3.05 bcf/d (Not all of the above companies have designated off-take volumes)

15. Japan Firms Open Alaska Office to Pursue LNG Anchorage Daily News, October 24, 2012 “…the group sent a letter to TransCanada indicating an interest in shipping 2.7 billion cubic feet a day through a potential large-diameter pipeline from the North Slope to south Alaska during the pipeline company’s recent non-binding Solicitation of Interest to shippers.”(Emphasis added) “Members of the Japanese consortium include Japan Petroleum Exploration Co. Ltd.; Idemitsu Kosan Co.; JX Nippon Oil and Energy Corp.; Mitsubishi Gas Chemical Co. and Nippon Telephone and Telegraph.”

16. Total Nomination for LNG Per AGIA Solicitation of Interest, September 14, 2012 Asia market nominations 5.50 bcf/d In-state demand .25 bcf/d 5.75 bcf/d Maximum Volume Capacity 48” line (max. compression) 5.9 bcf/d Wood Mackenzie economic calculations of $ to Alaska based on 2.7 bcf/d project

18. Alaska’s Competition for Asian Markets ExxonMobil • Qatar – North Field • Papua New Guinea • Australia • Golden Pass (U.S. Gulf Coast) ConocoPhillips • Qatar • Australia and Timor-Leste BP • Trinidad (Atlantic LNG) • North West Shelf (Australia) • ADGAS (Abu Dhabi) • Tangguh (Indonesia) • Bontang (Indonesia)

20. Potential Benefits to Alaskansfrom a State-Owned Gasline/LNG ProjectbyPDC Harris Group LLC Energy Cost Savings: Bethel and Fairbanks • Bethel energy cost savings of up to 65% • Equates to potentially $886 million in fuel savings cost for Bethel residents (over 30 years) • Fairbanks energy cost savings up to 80%

21. Benefits to All Alaskans from Large Volume Gasline to Tidewater with LNG Export • Low Cost / Clean Burning Energy to Alaskans. • Revenues to Alaska equivalent to 10PFDs.

22. Thank you 731 N Street Anchorage, Alaska 99501 www.allalaskagasline.com