For immediate release

World’s first CNG Centre of Excellence dedicated to large-scale marine transport of compressed natural gas to be located in St. John’s, Newfoundland, Canada

EnerSea Canada Inc. (September 11, 2003), in partnership with Memorial University, will lead the establishment of the world’s first research and development centre for large-scale marine transport of compressed natural gas (CNG). The centre will be a federally incorporated not-for-profit entity and will be located at the St. John’s campus of Memorial University of Newfoundland. This centre will establish a fully dynamic research and development test facility dedicated to large-scale marine transportation of CNG.

“We applaud the vision EnerSea Canada has shown by leading this Centre of Excellence initiative,” said Memorial President Dr. Axel Meisen. “We are also very grateful that the Atlantic Innovation Fund supports this research and development activity in Atlantic Canada”.

The Centre of Excellence will conduct innovative research and development in CNG marine transportation and related issues with the goal of advancing technologies capable of delivering natural gas from off-shore locations where pipelines do not exist or are impractical. The centre will address the technical challenges associated with developing a complete transportation system (gas processing, loading/offloading, storage and safety practices) for global applications, including for harsh environments such as those offshore Atlantic Canada.

“We are delighted that The Atlantic Innovation Fund has recognized the vital role CNG marine transport will play in the monetization of stranded gas reserves both regionally and globally,” said Stephen Henley, Managing Director of EnerSea Canada. “This Centre will certainly provide Atlantic Canadian research institutions and industry the opportunity to be at the forefront of CNG marine transport technology on a global basis.”

The current and future partners in the Centre include CNG technology providers, shipping companies, classification societies, natural gas infrastructure providers, offshore technology providers, petroleum producers, universities, research organizations and the governments of Newfoundland and Nova Scotia.

“We wish to recognize and extend our appreciation for the broad support received from academia, in particular from Memorial University, industry and government for the CNG Centre of Excellence, as this initiative has truly been a collaborative effort from the outset”, Henley added.

For further information, please contact Stephen Henley, EnerSea Canada,

709-739-1010 ; or Ivan Muzychka, manager, News Service, Memorial University,

709-737-8665, cell 709-687-9433.

Compressed Natural Gas (CNG) Centre of Excellence

EnerSea Canada, Inc.

EnerSea Canada, Inc. and Memorial University of Newfoundland will lead the establishment of the world’s first research and development Centre for large-scale marine transportation of compressed natural gas (CNG). The Centre’s contributors and partners include: internationally-recognized petroleum research and development facilities/institutes (Memorial University of Newfoundland and The Gas Technology Institute); petroleum producers (Norsk Hydro and BP Exploration); shipping companies (Canship Ugland and K-Line); classification societies (ABS Americas and DNV); natural gas infrastructure providers (Maritimes and Northeast Pipeline, Emera Energy, and Enbridge); offshore technology providers (Bluewater Offshore Production Systems U.S.A. Inc., BMT Fleet Technology Limited, BMT Fluid Mechanics) and governments (Newfoundland and Nova Scotia).

The Centre will be a federally incorporated not-for-profit entity and will be located at Memorial University of Newfoundland in St. John’s.

The Centre will establish a large-scale, dynamic research and development test facility dedicated to CNG marine transport. This technology is especially targeted at 'stranded gas' (no existing transportation system exists) offshore in Atlantic Canada and worldwide. The Centre will engage industry and other research institutes, conduct collaborative research and development to meet industry-wide needs and provide contract research and development services to clients. The AIF-supported project will focus on two research and development areas: (i) CNG Process Engineering & Testing, and (ii) Maritime Systems Verification. Initial industry-wide research and development projects identified include: compact process equipment for pre-treating gas, offshore sulphur removal prior to CNG transport, ship design concepts, offshore loading/unloading, storage options, safety assurance investigations, transport service cost evaluations, and best practices interactive tools.

Of the total costs of approximately $8 million, the project will receive up to $3.994 million as a provisionally repayable contribution from the Atlantic Innovation Fund (AIF) over a five-year period.  As a result of the AIF investment, the proponent anticipates leveraging the remaining $4.1 million from other sources.

This funding will build new research and development capacity in the Atlantic region for the commercialization of large-scale marine transportation of compressed natural gas.