October 2, 2006

U.S.-approved CNG ship to feature Canadian storage system offering greater safety, environmental protection

The American Bureau of Shipping (ABS) has approved for construction a compressed natural gas (CNG) ship incorporating the Coselle storage system developed by a Calgary company, Sea NG Corporation. This is reported to be the world's first ship and cargo system for transporting CNG to be approved by the ABS or any other international marine classification society.

Sea NG's Coselle is a unique, patented system, invented in Canada, for storing high-pressure gas in a coil of small-diameter pipe. It has been in development for a decade by a team of experienced gas and marine engineers.

The Coselle (a contraction of the words "coil" and "carousel") essentially consists of a large coil of pipe wound into a cylindrical storage container. Typically, ten miles of small-diameter, high-strength pipe is coiled into the reel-like carousel, which provides support and protection for the transportation and stacking of Coselles

A Coselle may range in size from 15 to 20 metres in diameter and 2.5 to 4.5 metres in height, and may weigh about 550 tonnes. A single Coselle carries about three million standard cubic feet of gas (MMSCF) of natural gas, depending on the unit's dimensions, and gas temperature, pressure and composition. Numerous Coselles can be transported aboard the specially-designed ship.

Sea NG says its storage system has significant safety and cost advantages over conventional large-diameter pressure cylinders. It requires minimal on-shore facilities: gas can be loaded and discharged at simple port-side pipeline facilities, which greatly reduces environmental, land-use and financial concerns. Gas can also be trans-shipped at offshore buoys if a port is not accessible.

The complete delivery system includes a ship plus loading and offloading facilities. The gas is compressed at a loading terminal (onshore or offshore) and loaded into a CNG ship. The ship then travels to the offloading terminal (onshore or offshore) where the gas is decompressed and delivered to market.

Coselle CNG ships will be deployed to carry moderate volumes of natural gas (30 to 500 MMSCF) over medium distances (200 to 2,000 km). This is a segment of the marine gas transportation market that has not been economically served by pipelines or liquefied natural gas (LNG). Sea NG has specifically developed its system to fill this market gap, i.e. situations where pipelines are not viable or where LNG is not economic or appropriate.

The company notes that there are a number of conditions which can make CNG transport a preferred alternative to a stationary pipeline, for example, in locations where it would be technically difficult and very expensive to build a pipeline, such as in very deep water or where seabed hazards exist, e.g. mudslides, seismic activity, or rough topography. In some circumstances, local environmental standards, such as fishery restrictions, or concerns about coral or other sea life, prohibit pipelines.

"Our Coselle CNG ship will provide the market with a safe, reliable and cost effective alternative means of transporting natural gas by sea," said David Stenning, president and CEO of Sea NG.

More information is available from Allan Keough, executive vice-president of Sea NG, 403/539-9742, E-mail info@coselle.com, Web site www.coselle.com, or on the ABS Web site, www.eagle.org.

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