Mass Production of Pipes for Nord Stream 1 and prepared for Nord Stream 2 Berlin, Oct. 20th, 2015 H.G. Hillenbrand

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1 Mass Production of Pipes for Nord Stream 1 and prepared for Nord Stream 2 Berlin, Oct. 20th, 2015 H.G. Hillenbrand

2 Topics Review EUROPIPE Experience with NordStream 1 What happened at EUROPIPE since 2012? Why EUROPIPE again for NordStream 2

3 Nord Stream 75%

4 Nord Stream at a Glance

5 Vertrag Nord Stream I

6 Overview of EUROPIPE s Share for the Main Pipeline Central Line Pipe Orders: NSP 1 PO EP 601/ NSP 2 PO EP 601/ Nord Stream I & II Sum Diameter 1153 mm i. D. Wallthickness 26.8 mm 30.9 mm 34.6 mm Length km km km km No. of Pipes 90,050 41,655 21, ,323

7 Milestones: Delivery of the 1 Mio. t Nord Stream AG and EUROPIPE GmbH on delivery of the t

8 Excellent Pipe Geometries Average Ovalitiy pipe end below 2,3mm for 48 pipe: <0,2%

9 Review of Pipe Coating Project Internal surface External surface Nord Stream I Nord Stream II EBK Sumitomo (coating) Sumitomo (rework and coating Eupec) m² m² m² m² m² m² m² m² m² m² total: m² m²

10 Logistics: Overview of the Logistical Challenges Transport by Train (Mülheim-Mukran) Vessel (Mülheim-Bremen-Kotka) No. of Pipes 116,571 36,752 No. of Trains No. of Waggons 36,482 10,695 No. of Vessel Pipes / Train (Vessel) (287)

11 Summary of Highlights NS1 Very stable Results of all Mechanical Properties Pipe Mill with highest Productivity and stable processes: Allows to limit welding qualifications Leads to limited Inspection Cost Excellent geometrical Properties and workmanship Lowest Ovality High Average Lengths result in fast Pipe Laying Low mill repair rate Established and reliable Pipe Tracking System Backup by 2 Plate Sources Very good and fast Coating Facilities Professional Risk Management Optimized Transportation Route (short and riskless)

12 Conclusion on Nord Stream 1 A team approach is needed to mature a challenge to a success. The continuous improvement during the order execution led to Performance increase Quality enhancement. The project organizations as well as the team members contributed to the success of the project.

13 What happens at EUROPIPE since 2012 Generally weak order backlog due to missing Projects, but 450kt Production for Ichthys Pipeline Project (Australia) including BAA and Logistics 460kt booked for South Stream including BAA, concrete coating and Logistics New Major Investments in Pipe Mill and Coating Yard

14 ICHTHYS, Australia Technical Outlines Customer: INPEX Australia Pty LTd Route: 881 km offshore from Ichthys gas field (Timor Sea) to Darwin (Australia) EUROPIPE Volume (Length, Tonnage): Volume 1: 500 km / 408kt Volume 2: 9km / 9kt Dimension (OD, WT, Lengths): Volume 1: 42 x 29,6-37,2mm Volume 2: 42,8 x 40,1mm Source: EP-SD2 Base material Fracture Arrest Requirements (CVN for main quantity: Minimum 219 Joule / 239 Joule 0 C SAWL 450 / 485 Minimum 291 Joule / 318 Joule 0 C SAWL 450 / 485 Pipes with S requirement: Slightly Sour, Test Solution A bar H2S no SSC test Grade: Volume 1: X 65 Volume 2: X 65 Medium: Gas Delivery Time:

15 Former South Stream Pipeline Offshore South Stream Offshore Lengths of each line EUROPIPE s share of pipline 1 EUROPIPE share 931 km = approx t approx. 600 km = t Capacity of each single line 15,75 bill. m³ Pipe dimension Water depth x 39.0 mm (OD x WT) max m Source: South Stream BV

16 What happens at EUROPIPE since 2012 New major investments: New laser device for pipe body dimension control New UT equipment for pipe end inspection (PA technology) Replacement of welding power sources by latest generation Additional induction heating coil in the coating plant New pipe carrier (Tatra) in the coating yard New PE/PP extrusion unit Refurbishment of pipe transportation system in the coating yard

17 Automatic Pipe Body Measurement Up to 24 laser sensors determine the distance from reference point to pipe surface Pairs of opposed sensors measure diameters in 12 planes (15 distance) Repeatability σ=0.1 mm Calibration with reference standard with a dressed area

18 New Pipe end UT inspection Fully automated PLC controlled pipe end testing. The probe holders are applied to the pipe surface from the inside. The pipe turns and the inspection starts. Operator s Cabinet South Operator s Cabinet North

19 Additional induction coil in coating plant New induction coil needed to fulfil customer s specification of heattreatment Investment in third induction coil results in additionally increased capability for thick walled pipe dimensions.

20 New PE/PP Extrusion Unit: Granulate Dryers Innovative geometry of displacement element, larger volume and more heating power lead to effective drying of material. Heated air circulates within drying units so that the process is more efficient and energy saving. New granulate dryers enable the necessary quality and quantity of the foil in subsequent extruding process and meet all the modern demands for a future-oriented coating plant.

21 work and higher quality in form of more homogeneous foil. New PE/PP Extrusion Unit: Screw Extruders Two new state of the art screw extruders increase output from1,600 kg/h to 2,400 kg/h each. Included software enables systematic monitoring and surveillance of process parameters e.g. various temperatures, pressures, currents and screw speed. Investment results in higher power (850 kw each), less maintenance

22 Arguments to work with EUROPIPE again EUROPIPE has a reasonable share in the large-diameter pipe market and has long lasting experience to handle Mega-Projects EUROPIPE has a huge experience in the production of heavy wall offshore pipes acc. DNV OS-F101. Production of pipes for the NordStream Project requires high process stability to reach the specified quality. The Logistics is able to handle 360 plates and pipes per day 3-4 trains can be shipped e.g. to Mukran per day. Our target is to supply up to 1.3 mill. t for NS2 within 22 month, which is an average of t per month. Supply is guaranteed all year long due to moderate weather conditions Short transit routes allow in-time supply Our products are 100% of German Origin and therefore coverable by German ECA (EULER-Hermes) EUROPIPE will reserve free capacities to supply all quantities in time Our wish is NordStream 2 to become a success like NordStream 1

23 Thank you for your kind attention

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