Exhibit 10.30 

 

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THIS HEADS OE AGREEMENT made effective the 31 day of August, 2010 is entered
into:

  

BY AND BETWEEN:

PACIFIC GREEN TECHNOLOGIES MARINE LIMITED, a company registered in England &
Wales whose registered address is 2 - 6 Cannon St. London EC4M6YH (“PGTM”)

        AND:

UML Westminster Limited

Portland House. 69-71. Wembley Hill Road. Wembley, Middlesex. HA9 8BU United
Kingdom ("UML WESTMINSTER")

        AND:

UNION MARITIME LIMITED

5 Welbeck Street

London, WIG 9YQ

United kingdom ("Union")

 

A. WHEREAS PGTM is engaged in the business of marketing and sales of its
patented emission control technologies called ENVI-CleanTM and ENV1-MarineTM
scrubbing systems (the "System") which are capable of removing sulphur dioxide
and other acid gases from exhaust gas emissions to a level that meets the
regulatory requirements of the International Maritime Organization (the "IMO”):

 

B. WHEREAS the System's effective scrubbing of regulated emissions enables ship
owners to achieve cost savings by allowing the continued use of lower cost heavy
fuel oil ("HFO") when operating in Sulphur Emission Control Areas ("SECA").

 

C. WHERE AS UML WESTMINSTER is the wholly-owned subsidiary of Union.

 

D. WHEREAS Union intends to purchase the System for up to an additional ten
vessels over the following eighteen months subject to the Systems performance.

 

E. WHEREAS PGTM proposes to supply UML WESTMINSTFR with the System for the main
engine of the vessel named "Westminster ("Candidate Vessel"). The System will
operate in accordance with the terms and specifications contained herein.

 

F. WHEREAS UML WESTMINSTER presently desires to acquire an emission control
system to: (a) meet the IMO sulphur emission regulations within the SECA's in
which it operates: (b) to minimize the cost of air emission compliance: and (c)
to minimize the operating changes within its ship's systems.

  

 

 

 

NOW THEREFORE in consideration of the covenants contained herein, PGTM, Union
and UML WESTMINSTER mutually agree as follows:

 

1.  DEFINITIONS AND INTERPRETATION

 

1.  In this Heads of Agreement the following terms shall have the following
meanings:

 

"Accepted" means that PGTM and the System have met the IMO's performance
standards for vessels operating within a SECA;

 

"Candidate Vessel" means the vessel nominated by Union to receive the
ENVI-MarineTM scrubbing system. It is agreed that this is the Westminster. Union
have the option to substitute the Candidate Vessel for another vessel on or
before 17.00 Hrs BST on the 5th of September 2016 on the same terms as this
Agreement at which time UML Westminster Limited will also be substituted for
another Union subsidiary.

 

"Emission Control Technology" means the integrated technology, techniques and
processes proposed to be adopted onboard the Candidate Vessel for the purpose of
achieving the required level of air emissions reduction. The System will be a
key component of the emission control technology;

 

"Energy Management Lease Agreement" means the definitive agreement in regards to
the purchase option finance lease to be entered into between PGTM and UML
WESTMINSTER on substantially the same terms set out in this Heads of Agreement;

 

"Fuel Cost Savings per Hour" as detailed in Schedule 3 shall mean the difference
in cost/tonne of HFO 380 and LSMGO less the average operating cost/tonne
multiplied by the number of tonnes of fuel consumed per day divided by 24 hours
to yield the hourly fuel cost savings.

 

"LSMGO" means 0.1% sulphur fuel specified by the IMO as the basis for SECA
sulphur emission compliance;

 

"Operating Quarter" shall mean each period of three (3) months commencing from
the date on which the System is successfully tested and is accepted by UML
WESTMINSTER;

 

"Open Mode" shall mean the operating mode where raw seawater is pumped through
the System and discharged into the sea with a minimum of processing. This is
considered the standard operating mode for open sea operations. See Schedule 2
for a detailed description.

 

"Closed Mode" shall mean the operating mode whereby the seawater is recirculated
through the scrubber in a closed loop. This mode would be used for main engines
in circumstances where effluent discharge regulations or lack of seawater
alkalinity require this operating mode. See Schedule 2 for a detailed
description.

  

 2 

 

 

"Scrubber Operating Hours" shall mean the number of hours of scrubber operation
logged in open and closed modes by the ENVI-MarineTM system's computerized data
logger.

 

  2. The singular includes the plural and vice versa.

 

  3. The clause headings do not form part of this Heads of Agreement and should
not be taken into account in its construction or interpretation.

 

  4. References in this Heads of Agreement to the "Schedule" are to the
Schedules to this Heads of Agreement.

 

2. ENTRY INTO AN ENERGY MANAGEMENT LEASE AGREEMENT

 

1. Subject to the System being Accepted, UML WESTMINSTER agrees to enter an
Energy Management Lease Agreement with PGTM for the System for the total sum of
US$1,995,000 plus sales taxes (the "Purchase Price").

  

2. The Purchase Price shall be payable by UML WESTMINSTER in variable
installments for each Operating Quarter, until the Purchase Price has been paid
in full. The amount payable in respect of each Operating Quarter shall be
calculated on the basis of the terms set out in the Energy Management Lease
Agreement (as outlined in Schedule 4).

 

3.  From the date that the System is Accepted, PGTM shall grant to UML
Westminster and UML Westminster shall acquire the right from PGTM to purchase
the System:

 

  a. at a cash discount of $80,000 to the balance outstanding of the Purchase
Price during the first three years from the date that the System is Accepted; or

 

  b. at a cash discount of $40,000 to the balance outstanding of the Purchase
Price during the fourth and subsequent years from the date that the System is
Accepted.

 

4. The following assumptions shall be used when calculating the amount payable
for each Operating Quarter:

 

  a. UML Westminster guarantees a minimum of 870 Scrubber Operating Hours, per
Operating Quarter (3,480 hours per annum or 145 days per year in the SECA). The
Scrubber Operating Hours for each Operating Quarter, shall be the greater of the
average number of hours of scrubber operation for each Operating Quarter for the
previous 12 months

 

  b. The Parties will use the relevant Operating Quarter's average LSMGO and IFO
380 HFO price as published by Bunker Times for Rotterdam to make the calculation
for the quarterly Energy Management Lease Agreement payment.

  

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  c. The Parties agree to the scrubber operating mode costs that are
incorporated into the scrubber cost savings contained in Schedule 3 for the
duration of the full term of the Energy Management Lease Agreement which are
summarized as:

 

    OPEN MODE CLOSED MODE     LADEN BALLAST LADEN BALLAST   WESTMINSTER $14.00/t
15.00/t $33.00/t $33.00/t   MODE AVERAGE $14.50/t $33.00 /t

 

4. Lease Payment Due Date: lease payments are due to PGTM within fourteen (14)
calendar days of the end of each Operating Quarter.

 

5. The title to the System shall be transferred to UML WESTMINSTER in
consideration for US$1 upon completion of payments equal to the Purchase Price.
Simultaneously with the transfer of title, PGTM shall provide UML WESTMINSTER
with the necessary documentation to evidence the transfer of title and shall
take all necessary steps with the Classification Society and any other
authorities to evidence the transfer of title.

 

3. CONDITIONS

 

3.1 The obligations of UML WESTMINSTER and PGTM to complete the transactions
provided for herein are subject to the satisfaction of the following conditions
or the waiver of same by the Parties on or before 21 days after the date of this
Heads of Agreement:

 

  a) The Parties agreeing and entering into a binding Energy Management Lease
Agreement, the main commercial terms of which are summarized in Schedule 4 of
this Heads of Agreement. PGTM shall provide a draft of the Energy Management
Lease Agreement within 7 days after the date of this Heads of Agreement.

 

  b) PGTM providing full specification of the ENVI-MarineTM Emissions Control
System.

 

  c) The Parties agree that the rate of fuel consumption in tonnes/day (t/d)
shall be the arithmetic average of the MACR (19 t/d) and NCR (17 t/d) fuel
consumption rates.

 

  d) UML WESTMINSTER providing the itinerary of the Candidate Vessel and UML
WESTMINSTER providing and PGTM agreeing to a scheduled installation date for the
ENVI-MarineTM Emissions Control System.

  

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  e) PGTM confirming that the necessary certificates required for the
ENVI-MarineTM Emissions Control System to be installed and Accepted have been
provided by the Classification Society or the relevant authority (as the case
may be).

 

3.2 SCRUBBER OPERATION

 

  a) The scrubber will be turned on upon instruction from the ship's officers
when the Candidate Vessel's GPS (or alternative positioning instrument)
determines that the Candidate Vessel is within a SECA or the Candidate Vessel's
operating protocol requires compliance with IMO emission regulation limits.

 

  b) The Scrubber Operating Hours will be logged, in open and closed mode, by
the ENVI-MarineTM computerized data logger control system. The logged hours will
be used to determine the Scrubber Operating Hours, in open and closed mode, in
the calculation of the payment due for each Operating Quarter.

 

  c) In case of any discrepancy regarding Scrubber Operating Hours in a SECA,
the ship's GPS data and log books will be used to resolve the discrepancy.

 

  d) In case of failure of one of the System's essential components, the
scrubber is to be shut down and by-passed until repairs and/or replacement can
be completed.

 

4. GUARANTEES AND WARRANTIES PROVIDED BY PGTM

 

4.1 On such date title to the System is transferred to UML WESTMINSTER pursuant
to section 2.6 of this Heads of Agreement, PGTM shall grant UML WESTMINSTER an
irrevocable exclusive worldwide royalty free licence in perpetuity in respect of
the System and all the equipment and materials used to support the patented
technology as more particularly described in the List of Principal Components
set out at Schedule 1, to the extent required to enable UML WESTMINSTER and each
and every subsequent owner, charterer or operator of the Candidate Vessel to use
the System.

 

4.2       PGTM will design, engineer, manufacture and install the System such
that it operates in accordance with: (i) the specifications and emission
regulations identified in this Heads of Agreement and the Energy Management
Lease Agreement; and (ii) the specifications of the Candidate Vessel.    
4.3      PGTM provides the expressed warranties as to the operational
performance of the System that are specifically identified in Annex VI -
Regulation 14 of MARPOL. Other than the expressed warranties as to the
operational performance of the System identified in this Heads of Agreement and
as shall be identified in the Energy Management Lease Agreement, PGTM shall make
no other warranties, whether expressed or implied.     4.4      PGTM confirms
that the System shall comply with the current IMO regulations in effect as of
the date of this Heads of Agreement and the world ocean limit set to go into
effect on January 1, 2020.     4.5        PGTM to confirm that the System will
not put more than 6" of back pressure on the main engine exhaust of the
Candidate Vessel.

 

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5     OBLIGATIONS OF UML WESTMINSTER     5.1    UML WESTMINSTER shall use
reasonable endeavours to assist PGTM by providing data, information and
materials to PGTM as is necessary for the operation and installation of the
System in an efficient and punctual manner.     5.2      Within 7 calendar days
of the Parties entering into the Energy Management Lease Agreement, UML
WESTMINSTER shall specify a shipyard for the installation of the System in
either Dubai or Turkey and UML WESTMINSTER shall confirm the intended date of
installation.     5.3     UML WESTMINSTER will make reasonable adjustments to
the Emission Control Technology, and will also make reasonable changes to
operational policy as may be reasonably required by the installation on the
Candidate Vessel of the System. UML WESTMINSTER shall not be obliged to adopt
commercially unrealistic solutions whereby the profitability of the operation of
the Candidate Vessel is affected.     5.4      UML WESTMINSTER will permit:

 

  (a) PGTM, its contractors and agents to bring testing consultants, government
and agency representatives and advisors for tours of the Candidate Vessel where
reasonable access will be provided for inspection (and limited and reasonable
testing) to all aspects of the Candidate Vessel connected to the System; and

 

  (b) PGTM, its contractors, subcontractors, agents, equipment suppliers,
consultants and inspectors to access the vessel for the purposes of
construction, installation, inspection, commissioning and evaluation of the
System,

 

provided always that: (i) PGTM shall give not less than 10 days' prior written
notice to UML WESTMINSTER of such visits; (ii) such visits shall not cause any
unreasonable interference or delay to UML WESTMINSTER's operation, maintenance
and use of the Candidate Vessel; and (iii) such visitors shall sign UML
WESTMINSTER's letter of indemnity prior to their embarkation.

  

5.5 UML WESTMINSTER agrees to operate the System in accordance with the emission
control system process specifications as defined by PGTM. UML WESTMINSTER
acknowledges that this may change within reason once the System is operational
and PGTM shall notify UML WESTMINSTER of such changes, in writing, prior to such
changes taking effect. Changes will be designed to achieve compliance with the
IMO sulphur dioxide regulations as long as any such design changes do not impair
the safe operation of the Candidate Vessel.

 

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5.6 UML WESTMINSTER will cooperate with PGTM and its agents to determine all the
requirements necessary to ensure the successful design and operation of the
System, to include, but not limited to, specific operating information, engine
requirements, emissions limits/requirements and regulations to air and water.
This information will be transmitted in a timely manner to assist PGTM in
complying with the terms of the Energy Management Lease Agreement and any other
conditions relating to the performance of the System.     5.7 If the Candidate
Vessel is sold, UML WESTMINSTER shall use reasonable commercial endeavours to
procure that the buyer shall enter into an agreement with PGTM on the same or
substantively the same terms as the Energy Management Lease Agreement. If the
Candidate Vessel is sold and the buyer does not enter into an agreement with
PGTM on the same or substantively the same terms as the Energy Management Lease
Agreement, UML WESTMINSTER shall pre-pay any outstanding amount with a
cumulative annual deduction of 7.5% of such outstanding amount     6.
ASSIGNMENT, BINDING ON SUCCESSORS IN TITLE     6.1  Neither party may assign any
of its rights or obligations under this Heads of Agreement without the prior
written consent of the other Party, such consent not to be unreasonably withheld
or delayed.     6.2 In the event that UML WESTMINSTER shall part with possession
or control of the Candidate Vessel, and in order to secure the value of the
investment being made by PGTM, UML WESTMINSTER shall use reasonable commercial
endeavours to procure that a novation agreement is entered into with any
assignee, transferee, lessee or contractor/operator (as the case may be) whereby
the obligations of UML WESTMINSTER are novated to the assignee, transferee,
lessee or contractor/operator (as the case may be) such that the resulting
obligations are between PGTM and the assignee, transferee, lessee of
contractor/operator.     7.  ENTIRE AGREEMENT AND WAIVER     7.1 This Heads of
Agreement contains the entire agreement of the Parties with respect to the
subject matter of this Heads of Agreement and supersedes all prior agreements
and arrangements (whether written or oral) in relation to such subject matter
between the Parties and may only be varied by the written agreement of both
Parties.     7.2 A waiver by either Party of a breach of any term or condition
of this Heads of Agreement shall be in writing, and shall not be deemed as a
continuing waiver or a waiver of any subsequent breach unless so provided by
written notice.     8. GENERAL     8.1 No Partnership. Nothing contained in this
Heads of Agreement shall be deemed to create any relationship of agency,
partnership or joint venture between the parties.

 

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8.2 Applicable Law. This Heads of Agreement shall be governed by and construed
in all respects in accordance with the laws of England and Wales.     8.3
Dispute Resolution. All disputes arising out of or in connection with this Heads
of Agreement shall be finally settled under the Rules of Arbitration of the
International Chamber of Commerce by one or more arbitrators appointed in
accordance with the said Rules.     8.4 Publication Rights. Except as required
by law or by any regulatory authority, each Party may, with the prior written
consent of the other, publicise the terms of this Heads of Agreement and UML
WESTMINSTER shall allow PGTM to use UML WESTMINSTER's name and title in any such
media placement as directed by PGTM.     8.5 Definitive Agreement. The Parties
agree to act in good faith in negotiating the terms of the Energy Management
Lease Agreement that will embody the terms and conditions of this Heads of
Agreement and will include covenants and conditions customarily included in
transactions of this kind. PGTM will provide specific representations and
warranties and indemnities concerning the title and sufficiency of the System.
Subject to Clause 3 of this Heads of Agreement, unless the Parties agree
otherwise in writing, if the Energy Management Lease Agreement has not been
entered into within 21 days following the date of this Heads of Agreement, this
Heads of Agreement shall terminate, without any further liability or obligation
on either Party.     8.6 Intention of the Parties. This Heads of Agreement is
intended to be binding on both Parties.

 

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SIGNATURE PAGE

 

IN WITNESS WHEREOF the parties hereto have caused this Heads of Agreement to be
executed as of the date first written above by their respective officers
thereunto duly authorized.

 

  This Heads of Agreement was executed as a binding act of PACIFIC GREEN
TECHNOLOGIES MARINE LIMITED in the presence of:  

Per:

      /s/ N.P. Carmichael   [ex10xxx_002.jpg]  

Dr. N.P. Carmichael

Chairman and Director

Signatory of PACIFIC GREEN TECHNOLOGIES MARINE LIMITED

  Signature           Print name of Witness     DANIEL           Address    
HILTON SINGAPORE           Occupation     NIGHT MANAGER  

 

  This Heads of Agreement was executed as a binding act of UML WESTMINSTER
LIMITED in the presence of:  

Per:

 

      /s/ Lewis Cadji   /s/ Mary Braganza  

Lewis Cadji

Director

  Signature           Print name of Witness               Address    

Mary Braganza

26 Ballards Road

London NW27UG

          Occupation     SECRETARY  

  

  This Heads of Agreement was executed as a binding act of UNION MARITIME
LIMITED in the presence of:  

Per:

 

      /s/ Lewis Cadji   /s/ Mary Braganza  

Lewis Cadji

Director

  Signature           Print name of Witness               Address    

Mary Braganza

26 Ballards Road

London NW27UG

          Occupation     SECRETARY  

 

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SCHEDULE 1

 

PRINCIPAL COMPONENTS OF THE ENVI-MARINETM SYSTEM

 

PGTM proposes to supply and install an ENVI-MarineTM SO2 scrubbing system which
is comprised of the following principal components:

 

Gas Conditioning Chamber (GCC) — This engine exhaust gas inlet chamber uses
seawater or recirculated water spray to quench the exhaust gas to approximately
35°C.

 

Scrubber — The scrubber body combines PGTM's patent-pending scrubber head with a
volume of packed bed media (PBM) located above the head. Demisters dry the gas
prior to exit to atmosphere. The footprint of the scrubber body is variable
depending on the configuration of space available. In general, the scrubber is
to be positioned at deck level corresponding to the base of the external stack
enclosure.

 

Because the scrubber heads are horizontal, the scrubber can be configured into
any shape. The marine scrubbers are to be made from stainless steel selected for
corrosion and acid resistance. To make the best use of space it is planned to
make the bodies rectangular in shape. The footprint required is approximately
1m2 for each MW of main engine propulsion.

 

Dissolved Air Flotation (DAF) Tank — The DAF tank receives water from the
scrubber and subjects it to DAF treatment, whereby soot, light particulate and
oil droplets are separated from the scrubber water by flotation. The oily
particulate is then skimmed from the tank and sent to the Oil Water Separator
system. The rest of the water, which may still contain some heavier particulate,
is directed to the Recirculation Tank.

 

Oil Water Separator (OWS) System — The oily waste skimmed from the DAF tank is
mainly comprised of water. The OWS system is designed to concentrate the oily
waste for storage in the Oily Waste Tank, and discharge the clean water. The
water may be directed to the Recirculation Tank during Open Mode operation or to
the Effluent Holding Tank during Closed Mode operation.

 

Oily Waste Tank — The Oily Waste Tank holds the residue from the OWS system for
removal at a land based facility.

 

Recirculation Tank — The Recirculation Tank receives water from various sources
and aggregates it for recirculation by pumps to the GCC water sprayers, the
Hydrocyclone System, and the PBM water distributor. The tank is partitioned so
that water from the DAF tank potentially containing heavier particulate is
directed to the Hydrocyclone System, and clean water returning from hydrocyclone
treatment is sent back to the scrubber. In Open Mode operation, excess water
overflows from the Recirculation Tank to the Effluent Holding Tank prior to
being discharged to sea.

 

Heat Exchangers — In Closed Mode operation, recirculated scrubber water is
cooled using heat exchangers supplied with cold seawater by the seawater pumps.

 

Hydrocyclone System - Banks of hydrocyclones are used for heavier solids
separation. Each system draws from a section of the partitioned Recirculation
Tank. The underflow containing the particulate is sent to the Disc Centrifuge
for further concentration, and the clean overflow water is sent back to the
clean water side of the Recirculation Tank.

 

Disc Centrifuge — The Disc Centrifuge subjects the underflow from the
hydrocyclones to high inertial forces to concentrate solids to a high degree for
storage in the Centrifuge Sludge Tank.

 

Effluent Holding Tank — When at sea the overflow from the Recirculation Tank is
held briefly in the Effluent Holding Tank before being discharged to the sea.
The Effluent Holding Tank is equipped with an Effluent Monitor for analysis of
pH, turbidity and phenanthrene PAH. When in port or when regulations restrict
discharge the tank is used to hold the small flow of effluent water from the OWS
system during Closed Mode operation for later discharge at sea.

  

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Caustic Soda Tank — Caustic soda is to be stored on deck in a 20-foot ISO tank
configured as a 20-foot bulk container. The tank will act as a reservoir for a
small caustic soda surge tank located in the water processing area below decks.
Injection pumps to provide alkalinity to the scrubber water during closed mode
or hybrid open mode are installed with the surge tank.

 

Continuous Emissions Monitoring System (CEMS) — The system includes a Continuous
Emissions Monitoring System (CEMS) to monitor and record sulphur dioxide
emissions on a continuous basis. Access to this information is required by
regulatory authorities.

 

Effluent Monitor — A tamper-proof system to monitor the pH, turbidity and
phenanthrene PAH of the effluent will be part installed on the Effluent Holding
Tank discharge line.

 

Programmable Logic Controller (PLC) — The system will be controlled by a small
programmable logic controller (PLC) with a graphic user interface at the
operations station or control room. The system will normally operate in
automatic mode, but manual control, data logging and trend screens will also be
available. Depending on the ship's communication capabilities, the system could
also be monitored and controlled remotely. This would allow the shipping company
and/or PGTM staff to troubleshoot any problems from land-based offices.

  

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SCHEDULE 2

 

DESCRIPTION OF OPEN AND CLOSED OPERATING MODES

 

Open Mode Operation

 

In open operating mode raw seawater is pumped through the scrubber system. This
is considered the standard operating mode for most open sea operations. The
seawater is pumped directly to the scrubber water distribution manifolds at the
gas conditioning inlet, and the top of the packed bed media. Scrubber water
draining from the packed bed media supplies water to the turbulent scrubbing
zone above the patented scrubbing head.

 

SO2 is removed and neutralized as the exhaust gases pass counter-current through
the water flows. The water drains from the scrubber base to a flotation skimmer
tank which uses air and dissolved air flotation to separate unburned carbon and
oil from the scrubber water. This material is skimmed from the flotation skimmer
tank and directed to the Oil Water Separation (OWS) system, which concentrates
the oily waste into a sludge and stores it in a sludge tank.

 

The excess clean water from the OWS system is then combined with the remainder
of the water flow from the flotation skimmer tank and directed to the
recirculation tank and then to the effluent holding tank. If high turbidity is
an issue, then some of the water can be processed through the hydrocyclone
system and disc centrifuge to reduce the overall levels. The cleaned water from
this operation may be sent to the GC inlet or directly to the effluent storage
tank.

 

The water held in the effluent holding tank is monitored continuously and then
combined with reaction water for pH balancing prior to being released to the
sea. In the event that the monitor measures a high reading for pH, turbidity or
phenanthrene PAH, the system will take a series of actions to respond, depending
on which parameter is high. High acidity can be remedied by adding NaOH to the
seawater and excess turbidity or phenanthrene PAH can be remedied by operating
the hydrocyclone system and disc centrifuge. If these steps do not solve the
problem, the system can be switched to closed mode operation where there is no
discharge to the sea.

 

Closed Mode Operation

 

In closed mode operation the seawater is recirculated through the scrubber in a
closed loop. This mode is used for auxiliary generators and boilers while in
port, and for main engines in circumstances where regulations require that no
effluent can be discharged. Three aspects of the scrubber's operation are
altered in this mode. First, the loss of seawater alkalinity is made up by the
addition of NaOH to the recirculation tank. Second, heat added through the
cooling of the exhaust gas is removed by heat exchangers cooled with raw
seawater. Third, the overflow from the flotation skimmer tank, hydrocyclone
system and disc centrifuge are returned to the recirculation tank for
recirculation to the scrubber.

 

The raw seawater used to cool the scrubbing fluid makes a single pass through
both the scrubber distribution and GC heat exchangers before being discharged.
This water is not in contact with the engine exhaust gases, so it does not
require any treatment.

 

In closed mode the scrubbing fluid takes the same path through the scrubber but
at a reduced flow rate since alkalinity can be made up by NaOH addition. The
closed system requires continuous cleaning so as to not build up oil or solids,
so the flotation skimmer tank, OWS system, hydrocyclone system and disc
centrifuge are all fully operational. A certain amount of bleed is necessary to
eliminate dissolved solids, and this is taken from the OWS clean water overflow,
which is directed to the effluent storage tank. As this is treated effluent, it
will meet discharge criteria once the vessel is back in the open ocean where
discharge is allowed.

 

Oily sludge is sent to the Oily Waste tank and centrifuge sludge may be sent
there as well or to a separate tank. Fresh water is added to the recirculation
tank to make up for water lost to evaporation in the scrubber and effluent sent
to storage. NaOH is added as required to maintain the pH of the scrubber water.

  

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SCHEDULE 3

 

OPERATIONAL SAVINGS

 

Fuel Savings for the Westminster with a Main Engine S02 Scrubber

 

   SECA Hours   Open   Closed  Quarterly HFO 380 cost (US$ / tonne)       $205  
$205  Quarterly MGO LS cost (US$ / tonne)       $400   $400  Quarterly Price
Difference (US$ / tonne)       $195   $195  Average Operating Cost (US$ / tonne
HFO)       $14.50   $33.00  Fuel Cost Savings (US$ / tonne HFO)       $180.50  
$162.00  HFO Consumption - Main Engine (tonnes I day)        15.0    15.0 
Current Fuel Cost Savings (US$ / day)       $2,707.50   $2,430.00  Current Fuel
Cost Savings (US$ / hour)       $112.81   $101.25  Quarterly Savings for 145
SECA Days / year   870   $98,147   $88,088  Annual Savings for 145 SECA Days /
year   3,480   $392,588   $352,350 

  

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SCHEDULE 4

 

ENERGY MANAGEMENT LEASE AGREEMENT SUMMARY
"WESTMINSTER"

 

The terms of the Energy Management Lease Agreement are summarized below.

 

  Purchase Price: US$1,995,000   Interest Rate: None   Lease Term: Variable  
Payments: Quarterly   Agreed Purchase Price at End of Lease: US$1   Quarterly
Payment Per calculation below

 

Quarterly Lease Payment =

 

Open Mode Fuel Cost Savings per Hour x Open Hours of Scrubber Operation

 +

Closed Mode Fuel Cost Savings per Hour x Closed Hours of Scrubber Operation

 

(total hours of operation not less than the guaranteed minimum hours per
quarter)

 

Payment for any hours which are deemed to be Scrubber Operating Hours in order
to fulfill the operating hours for the relevant Operating Quarter pursuant to
section 2.3(a) of this Heads of Agreement , shall be calculated at the
open:closed ratio of hours logged in such Operating Quarter.

 

 

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