#1Loan # 1313 Solicitation #: DE-SOL-000603 Document 1 DRAFT as of 9/15/2016 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS - FOR INTERNAL USE ONLY Northwest Innovation Works Kalama Presentation on Proposed Loan Guarantee 2016 ENER DRAFT U.S. DEPARTMENT OF ENERGY LOAN PROGRAMS OFFICE#2Overview of the NWIW Kalama Project ORHS Washington SEATTLE- TACOMA METHANOL EXPORTED PORTLAND PACIFIC OCEAN PROPOSED PROJECT SITE PORT OF KALAMA, WA Project Description: Natural Gas to Methanol Facility located in Kalama, WA NATURAL GAS SUPPLIED CANADA WASHINGTON Technology: Johnson Matthew PLC - Ultra Low Emissions (ULE) natural gas heated reformer technology Methanol Production: Designed to produce 10,000 MTPD (3.65 million MTPA) of methanol that will primarily be sold to China for production of olefins OREGON Total Project Cost: (b) (5) Port tenants near the proposed NWIW site include existing manufacturing plants and industrial gas facilities. project cost of (b) (4) Projected substantial completion in May 2020 U.S. DEPARTMENT OF ENERGY LOAN PROGRAMS OFFICE 1#3Overview of Proposed NWIW Kalama Loan Guarantee Loan Guarantee: Proposed [$2.017] billion loan (b) (5) Northwest Innovation Works Kalama, LLC with a term of project completion (b) (5) (b) (5) Eligibility: Project is eligible under Section 1703 loan guarantee program: innovative technology, greenhouse gas reductions, located in the U.S., and reasonable prospect of repayment. U.S. DEPARTMENT OF ENERGY LOAN PROGRAMS OFFICE 2#4Current State of the Review Process (b) (5) Conditional Commitment Equity and Debt Raise, Documentation, Due Diligence Closing Process Financial Close U.S. DEPARTMENT OF ENERGY LOAN PROGRAMS OFFICE 3#5Off-Take Agreements, Construction, and Operation Natural Gas Feedstock Electricity Feedstock Off-Take Contracts (b) (4) Construction Timeline •⚫ Construction Duration - 33 Months • Commissioning Duration - 3 months • Substantial Completion - May 2020 U.S. DEPARTMENT OF ENERGY LOAN PROGRAMS OFFICE 4#6Proposed NWIW Kalama Project Financing (b) (4) Total Eligible Project Cost – Total Eligible and Ineligible Project Cost - (b) (4) Equity-(b) (4) Stonepeak Infrastructure Partners Debt Capital - (b) (5) (b) (5) U.S. DEPARTMENT OF ENERGY LOAN PROGRAMS OFFICE 5#7Proposed NWIW Kalama Ownership Structure (b) (4) U.S. DEPARTMENT OF ENERGY LOAN PROGRAMS OFFICE 6#8Summary of Risk Factors and Credit Assessment Ranking Summary (b) (5) U.S. DEPARTMENT OF ENERGY LOAN PROGRAMS OFFICE 7#9Recommendation to the Credit Review Board (b) (5) U.S. DEPARTMENT OF ENERGY LOAN PROGRAMS OFFICE 8#103.5 Construction (b) (5) Document 2#11(b) (5)#123.6 Operations (b) (5) (b) (5) (b) (5) (b) (4) (b) (4) (b) (5) (b) (5) (b) (4) (b) (5) (b) (4) (b) (4) (b) (5) (b) (5) (b) (4) (b) (4) (b) (5) . (b) (5)#13(b) (5)#143.4 Technology NWIWK has selected JM Davy's Ultra Low Emissions (ULE) process technology to produce 10,000 metric tons per day of AA/GB grade methanol from natural gas utilizing two equivalent production trains. (b) (5) (b) (5) (b) (5) 3.5 Construction (b) (5)#15(b) (5) JM Davy is a major global technology licensor with significant experience in methanol production technology, primarily with steam methane reforming processes. The EPC contract is expected to be awarded to a consortium of Technip USA, Inc. (Technip), HQC USA LLC (HQC), and URS Energy & Construction, Inc. (AECOM). Technip has extensive experience with world-scale methanol plants globally, including a 5,000 MTPD methanol project in Louisiana, as well as a proven track record of successful modularization projects. (b) (5) (b) (5) (b) (5) (b) (5)#16(b) (5) 3.6 Operations (b) (5)#17(b) (5)#18RTMENT OF DEPARTM UNITED STA STAT OF ENERGY VO SOF OMB/Treasury/FFB Presentation Document 3 Loan # 1313 Solicitation #: DE-SOL-000603 [Date] Northwest Innovation Works Kalama (b) (4) Loan Guarantee for the construction of a natural gas to methanol facility producing 10,000 MTPD.#19Transaction Summary Project Description • The Project will be the first project in the U.S. to utilize the Johnson Matthey PLC - Ultra Low Emission ("ULE") reforming technology to process the natural gas. The ULE reforming technology consist of a Gas Heated Reformer ("GHR") in series with a Autothermal Reformer ("ATR”). (b) (5) The Project will consist of two x 5,000 MTPD (3,650,000 MTPA) grade AA methanol manufacturing trains. The Project is located in an industrial Park in Kalama, Washington (b) (5) (b) (5) (P) (5) The Applicant/Borrower is Northwest Innovation Works, Kalama LLC ■ Project has two Sponsors: Pan-Pacific Energy Corp., a Delaware corporation. ("PPE") and Stonepeak Partners LP, a limited liability partnership under the laws of the State of Delaware. EPC consists of a joint venture between Technip USA, Inc., URS Energy & Construction, Inc. and HQC USA LLC Key Metrics • (b) (5) Project Northwest Innovation Works Kalama Face Value Capitalized Interest Total Exposure Tenor (from Financial Close to Final Maturity) (b) (5)#20Policy Considerations Eligibility Eligible under the Energy Policy Act of 2005: 1703(a)(1) as an advanced fossil energy technology that avoids, reduces, or sequesters air pollutants or anthropogenic emissions of greenhouse gases. An independent greenhouse gas ("GHG") life cycle analysis concluded that the project can be expected to reduce GHG emissions by 41% when compared to the production of methanol as it is traditionally produced. 1703(a)(2) in that it will employ new or significantly improved technologies as compared to commercial technologies in service in the United States at the time the guarantee is issued. The Project will be the first project in the U.S. to utilize the Johnson Matthey PLC - Ultra Low Emission ("ULE") reforming technology to process the natural gas. Portfolio Impact • (b) (5) Utilization of Budget Authority and Loan Authority Jobs (b) (5) Expected to provide up to approximately 1,000 construction jobs and 200 permanent operations jobs. Sourced Components (b) (5) Other Government Assistance • (b) (5) Foreign Participation • · Shanghai Bi Ke Clean Energy Technology Co., Ltd., a Chinese company and majority owner of Pan-Pacific Energy Corp., primary sponsor to the Project. " (b) (4) EPC Joint Venture includes a French and Chinese engineering company, Technip and HQC Majority of the methanol off-takers are Chinese companies Technology provider, Johnson Matthey, is a UK based company#21Ownership Structure (b) (4)#22Equity Investors Equity Investors Pan-Pacific Energy Corp., A Delaware corporation, owned by Shanghai Bi Ke Clean Energy Technology Co., Ltd. ("CECC"), a Chinese Company Stonepeak Partners ◉ (b) (4)#23Equity Investors: Expertise and Capabilities Pan-Pacific Energy Corp. ("PPE") Established by Shanghai Bi Ke Clean Energy Technology Co., Ltd. ("CECC") in 2013, as a U.S. Delaware Corporation, to develop projects focusing on an integrated gas value chain in the US Pacific Northwest. CECC's shareholders include the following: Chinese Academy of Science Holdings Co. Ltd ("CAS Holdings") - wholly owned state company and private equity arm of the Chinese Academy of Sciences, China's leading academic and research organization. (b) (4) (b) (4) ◉ Double Green Bridge Hong Kong Limited ("DGB") -(b) (4) (b) (4) - Johnson Matthey Public Limited Company ("JM") – a British multinational chemicals and sustainable technologies company with operations in over 30 countries. JM's primary industries include environmental, automotive, chemical, pharmaceutical / medical, recycling, and oil, gas and refineries. According to JM's 2015 financials, the company generated over £3,125 million in revenue, with £591 million from its Process Technologies Division, which serves as a global supplier of catalysts, licensing, technologies and other services to the syngas, biochemical, petrochemical, oil refining and gas processing industries. In 2015, the Division had an underlying operating profit of £106 million. (b) (4)#24Equity Investors: Expertise and Capabilities Stonepeak Partners, LP DBA - Stonepeak Infrastructure Partners ("Stonepeak"): Formed as a limited liability partnership under the laws of the State of Delaware on March 23, 2011. The General Partner of Stonepeak Partners LP is Stonepeak Partners LLC. Stonepeak Partners LLC is a Delaware limited liability company and was formed on March 23, 2011. Stonepeak is a North America focused private equity firm investing in businesses involved in the following industries: energy, power and renewables, transportation, utilities, water and communications. Stonepeak manages $5.7 billion of capital for its investors. In January, 2016, Stonepeak announced that it had completed fundraising for its second fund, Stonepeak Infrastructure Fund II at its $3.5 billion market hard cap. Founded by Michael Dorrell and Trent Vichie Michael Dorrell – formerly worked as a Senior Managing Director in Private Equity and co-head of the infrastructure investment group at Blackstone. Prior to Blackstone, Mr. Dorrell worked for over a decade at Macquarie and has been investing in infrastructure for over 15 years. Trent Vichie - before joining Blackstone in 2008 as co-head of the infrastructure division, Mr. Vichie was a Managing Director with Macquarie Group in New York. He has 20 years' experience and has been involved in a wide range of infrastructure equity investments and transactions in the rail, airports, communications and utilities sector totaling over $10 billion.#25Contractual Structure (b) (5) (b) (5)#26Description of Technology Technology Technology The Project consists of two trains producing 5,000 MTPD each and utilizing Johnson Matthey's ultralow emission ("ULE") reforming technology to convert natural gas to synthesis gas and then the synthesis gas to methanol. Features The Project will be the first natural gas to methanol commercial operation in the U.S. to utilize the ULE technology, a proprietary process developed by Johnson Matthey Davy Technologies ("JM Davy") that utilizes a Gas Heated Reformer ("GHR") in series with an oxygen blown Auto Thermal Reformer ("ATR") to create a synthesis gas. The synthesis gas then goes through a methanol synthesis and distillation process. The advantages of ULE over other combined reforming technologies typically utilized in natural gas to methanol production operations are improved efficiencies of operation, lower operating costs, less land area requirements, and reductions in GHG emissions. FIRST-OF-ITS-KIND ENERGY EFFICIENT METHANOL REFORMING PRODUCTION PROCESS By using Johnson Matthey's Ultra Low Emissions gas heated reformer process, Northwest Innovation Works is able to lower total greenhouse gas emissions and improve efficiency compared to the business-as-usual production of methanol in the offtakers' region. TREATMENT INTO PURIFED NATURAL GAS GENERATION OF SYNTHESIS GAS CATALYST CONVERSION INTO RAW METHANOL PRODUCT DISTILLATION INTO PURE METHANOL PRODUCT METHANOL OFFTAKE NATURAL GAS DELIVERY#27• • Project Construction Consists of 36 months of Construction (estimate) and 1,000 workers 33 months construction and 3 months commissioning and start-up testing High level milestones (estimating construction start-up in June 2017) • . • June 2017 - November 2017: Site preparation and piling (5 months) June 2017 - February 2020: Construction (33 months) February 2020 - March 2020: System turnover (1 month) March 2020 May 2020: Commissioning (3 months) ― - April 2010 May 2020: Performance Testing (1 month) May 2020: Substantial Completion Approximately 40% of the entire facility will incorporate prefabricated modular system components (i.e. major components, piping, electrical, other vessels, etc.) Site essentially ready for start of construction (cleared, leveled, etc.) EPC Joint Venture Consortium (specific details for each member TBD) " Technip - Outside Boundary Limits (OSBL) and Inside Boundary Limits (ISBL) Engineering and Procurement HQC - ISBL Engineering and Procurement Aecom Construction and In-house Power Generation EPC Final Price - TBD December 2016 Project Development Personnel Project steadily adding staff with 20+ years of relevant experience Experience developing and constructing similar projects with global supply chain Project Management Contractor (PMC) - 50 person team to be selected by September 30, 2016 PMC will provide day to day construction management of the project#28Project Operations . O&M provided by a third party " (b) (5) Selection by September 30, 2016 and signed contract by October 31, 2016 O&M contract length and details TBD#29Technical Assessment Technology Risk - TBD (b) (5) • Execution Risk - TBD Construction Risk: TBD (b) (5) Schedule Risk - TBD - (b) (5)#30Feedstock Agreements Electricity (b) (4) Based on(b) (4) ' the Project will consume just over(b) (4) of electrical power. Contracts above, including(b) (4) total (b) (4) '#31Feedstock Agreements Natural Gas (b) (4) Based on (b) (4) representing (b) (4) Project will need approximately (b) (4) have a total quantity of (b) (4) of the facility. the NWIW-Kalama of natural gas. Contracts listed above of the gross natural gas requirement#32Off-Take Agreements (b) (4)#33(b) (5) Project Timeline#34Sources and Uses Uses Construction Costs Fixed Investments Contingency Costs Power Plant/Water Capex Financing and Transaction Costs IDC Other Advisory Fee Debt Service Reserve Account Initial Working Capital Upfront Fee Uses of Funds % $ millions Sources (b) (5) Senior Debt (b) (5) Equity Stonepeak Infrastructure % (b) (5) $ millions (b) (5) (b) (5) 100.0% Sources of Funds 100.0%#35Debt Tenor and Amortization Tenor and Amortization (b) (5) Debt Sizing Criteria (b) (5)#36Document 4 Northwest Innovation Works Project Part 1 Application Eligibility and Lifecycle Assessment TPMD Analysis and Recommendations Aug 2015 ENER ROUGH DRAFT ONLY, NEVER USED U.S. DEPARTMENT OF ENERGY LOAN PROGRAMS OFFICE#37Overview Analysis - - 2015 Part 1 Application and GHG Review Conclusions Project Part 1 Eligibility and LCA Conclusions Policy Impact Metric Considerations Northwest Innovation Works Proposed Innovative Technology: Ultra Low Emissions combined reforming technology. Natural gas to methanol plants currently under construction use steam methane reforming (SMR). The "Ultra Low Emissions combined reforming technology" proposed by the applicant replaces the SMR with a Gas Heated Reformer. The process is unique in that no high pressure steam is produced in the plant. This allows the use of available low-cost, low-emissions grid electricity to drive the compressors in the Air Separation Units and the syngas compression needed in the process. Replacing generated electricity with grid electricity to drive electrical power compressors also increases overall system efficiency and product output, while reducing overall project costs U.S. DEPARTMENT OF ENERGY LOAN PROGRAMS OFFICE 2#38Northwest Innovative Works Facility The Northwest GTM Project, sponsored by Pan-Pacific Energy Corporation (PPE), intends to develop, build and operate the largest Gas-to-Methanol (GTM) project in the U.S. Northwest GTM will employ GTM technologies to economically develop traditional fossil energy resources with reduced greenhouse gas emissions. Specifically, Northwest GTM will utilize combined reforming of gas-to-methanol (combining steam methane reforming and an auto-thermal reformer) to produce 10.95 million tons of methanol per year (more than ten times the largest operating methanol plant in the US today). The technology provider is UK-based Johnson Matthey. On average, it takes 32 Bcf of gas to produce 1 mmty of methanol. The Project is designed to produce 6 x 5000 metric tons of methanol per day in six lines or "trains." Each train has the same combined reforming methanol process unit while each two trains share integrated auxiliary facilities, utility facilities and transportation facilities. PPE has control of three sites (Kalama and Tacoma in Washington, and Port Westward in Oregon) to be the foundation of Northwest GTM. Kalama (Phase I): a 30-year lease agreement with five 10-year extensions on April 10, 2014. Tacoma (Phase II): a 30-year lease agreement with a 25-year renewal option on May 1, 2014. Port Westward (Phase III): Applicant indicates that the site has been "secured" U.S. DEPARTMENT OF ENERGY LOAN PROGRAMS OFFICE 3#39Northwest Process Flow Diagram NIW plans to construct a facility. U.S. DEPARTMENT OF ENERGY LOAN PROGRAMS OFFICE#40LPO System Boundary for LCA Analysis The LPO Methodology - (b) (5) U.S. DEPARTMENT OF ENERGY LOAN PROGRAMS OFFICE 5#41NIW Project Part 1 Application Claims 2015 NIW Application Claims U.S. DEPARTMENT OF ENERGY LOAN PROGRAMS OFFICE 6#42NIW Innovative Technology U.S. DEPARTMENT OF ENERGY LOAN PROGRAMS OFFICE 7#43Goal and Scope of Analysis Goal and Scope Sec. 1703 (a) (1) avoid, reduce, or sequester air pollutants or anthropogenic emissions of greenhouse gases: TPMD has reviewed the information provided by the applicant, and conducted an independent greenhouse gas (GHG) life cycle analysis (LCA). The LCA concluded that the project can be expected to reduce GHG emissions by 41% when compared to the production of methanol as it is traditionally produced Sec. 1703 (a) (2) employ new or significantly improved technologies as compared to commercial technologies in service in the United States at the time the guarantee is issued. According to the 10 CFR Part 609 definition of "New or Significantly Improved Technology," the Project must employ technology that: Is concerned with the production, consumption or transportation of energy and that is not a Commercial Technology. "Commercial Technology" is defined further as "a technology in general use in the commercial marketplace in the United States at the time the Term Sheet is issued by DOE. A technology is in general use if it has been installed and is being used in three or more commercial projects in the United States in the same general application as in the proposed project...” U.S. DEPARTMENT OF ENERGY LOAN PROGRAMS OFFICE 00 8#44NIW LCA Claims U.S. DEPARTMENT OF ENERGY LOAN PROGRAMS OFFICE 9#45GHG LCA Results Business as Usual (BAU) - Coal-To-Methanol in China Currently, China produces its own methanol via coal-to-methanol processes, which represents the BAU case. The coal-to-methanol unit process is based on an NETL report that models the coal-to-methanol process (NETL, 2014). PRB coal mining is used as a proxy for Chinese coal mining. PRB has low methane emissions, so it is unlikely that coal mined in China has lower GHG emissions. No transport is modeled in the BAU case, because it is assumed that any transport within China is negligible compared to the transport of methanol from the U.S. in the proposed case. Life cycle GHG emissions for the BAU case and proposed Northwest Innovations project are included below in Figure 1. The results are based on the production of one kg of methanol. The results show that the modeled emissions in the proposed case are 41 percent lower than in the BAU. U.S. DEPARTMENT OF ENERGY LOAN PROGRAMS OFFICE 10#46Factors considered in GHG analysis U.S. DEPARTMENT OF GHG Emissions (kg CO2e/kg MeOH) 2 1.5 0.5 0 Figure 1. Life Cycle GHG Emissions for the Northwest Innovations Project Coal Upstream I Natural Gas Upstream Methanol Production Purchased Electricity Ocean Transport Total 1.76 1.04 Business-As-Usual -- Coal-To-Methanol in Proposed -- Northwest Innovations Natural China Gas-To-Methanol Transported to China ENERGY LOAN PROGRAMS OFFICE 11#47Conclusions of the LCA (b) (5) U.S. DEPARTMENT OF ENERGY LOAN PROGRAMS OFFICE 12#48Further Considerations for NIW - Policy Metrics U.S. DEPARTMENT OF ENERGY LOAN PROGRAMS OFFICE 13#49Summary and Conclusions This analysis evaluated the life cycle GHG emissions from the production of methanol from the proposed Northwest Innovation Works facility The key conclusions of this analysis are: The expected life cycle GHG emissions for the production of TPMD has examined the Part I application to ensure technical eligibility under EPAct 2005 Section 1703 requirements, specifically sub-sections (a) (1), (a) (2), (b) (2) and (d). TPMD has determined that the Northwest Innovation Works Project is technically eligible under Section 1703 U.S. DEPARTMENT OF ENERGY LOAN PROGRAMS OFFICE 14#50DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS - FOR INTERNAL USE ONLY Document 5 RESTRICTED DISTRIBUTION – PRIVILEGED BUSINESS INFORMATION U.S. Department of Energy - Loan Programs Office CREDIT PAPER REQUEST FOR LOAN GUARANTEE APPROVAL PROJECT: Northwest Innovation Works - Kalama Gas to Methanol Manufacturing Project LOAN NUMBER: 1313 DATE: October XX, 2016 FT-WO RESTRICTED DISTRIBUTION - THIS E-MAIL OR DOCUMENT CONTAINS SENSITIVE PROPRIETARY INFORMATION AND OTHER INFORMATION THAT IS SUBJECT TO PROTECTION UNDER FEDERAL LAW, INCLUDING THE TRADE SECRETS ACT, 18 U.S.C. §1905, AND THE FREEDOM OF INFORMATION ACT (FOIA), 5 U.S.C. §552. PLEASE SAFEGUARD THIS INFORMATION AND REFRAIN FROM FURTHER DISSEMINATION. ANY FOIA REQUEST FOR ANY PORTION OF THIS DOCUMENT OR INFORMATION SHOULD BE REFERRED TO THE DEPARTMENT OF ENERGY.#51(b) (5) DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS - FOR INTERNAL USE ONLY CLEARANCE Date Date Date OGRESS Date Date (b) (5) October XX, 2016 Credit Paper Page 2 of 24 Northwest Innovation Works - Kalama#52DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS - FOR INTERNAL USE ONLY TABLE OF CONTENTS Section 1 Recommendation 1.1.1 Innovative 1.1.2 Greenhouse Gas Reductions 1.1.3 1.1.4 Prospects of Repayment.... Located in the United States Section 2 Project and Loan Summary Sheet. Section 3 Project Overview...... 3.1 Project Description... 3.2 Project Structure.. 3.3 Project Sponsors. 3.4 Technology 3.5 Construction. 3.6 Operations 3.7 Feedstock 3.8 3.9 Section 4 Section 5 Section 6 Offtake and Shipping. Environmental/Land/Regulatory/IP Financial Structure Overview Risks and Mitigants.... Risk and Recovery Matrix Summary. Independent Engineer's Report Market Report Financial Model Review Risk and Recovery Matrix Summary of Contracts Glossary Attachment A Attachment B Attachment C Attachment D Attachment E Attachment F Attachment G [ ] Attachment H Attachment I [ ] [ ] DRAFT - WORK IN PROKURA Page .5 5 .5 5 5 .6 .7 .16 .17 .17 .17 .18 .20 .21 222 .23 .24 October XX, 2016 Credit Paper Page 3 of 24 Northwest Innovation Works - Kalama#53DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS FOR INTERNAL USE ONLY Acronym Table AECO Alberta Energy Company AECO/NIT CTO DME DOE dwt EIS EPC JV FFB IMPCA ISBL JM Alberta Energy Company/NOVA Inventory Transfer Coal-to-olefins Di methyl ether U.S. Department of Energy Deadweight tonnage Environmental Impact Statement Engineering, Procurement and Construction Joint Venture Federal Financing Bank International Methanol Producers and Consumers Association Inside boundary limits Johnson Matthey Plc LPG Liquid petroleum gas LPO Loan Programs Office MeOH Methanol mmBtu One Million British Thermal Units MMSA Methanol Market Services Asia MTBE Methyl tertiary butyl ether MTO Methanol-to-olefins MTPD Metric tons per day NWIW OBE Open book estimate OSBL Northwest Innovation Works Kalama, LLC Outside boundary limits PUD Public Utility District Treasury U.S. Department of the Treasury ULE Ultra-Low Emissions technology licensed from Johnson Matthey Plc October XX, 2016 Credit Paper Page 4 of 24 Northwest Innovation Works - Kalama#54DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS FOR INTERNAL USE ONLY Section 1 (b) (5) Recommendation 1.1.1 1.1.2 Innovative The Project meets the innovative criterion by employing new or significantly improved technology, as compared to commercial technology, through its proprietary use of the Ultra Low Emissions process ("ULE") licensed from Johnson Matthey Davy Technology which includes a gas heated reformer in series with an auto-thermal reformer. The Project will be the first natural gas to methanol commercial operation in the United States to utilize the ULE technology. (b) (5) Greenhouse Gas Reductions 1.1.3 (b) (5) Prospects of Repayment 1.1.4 Located in the United States The Project is located in Kalama, Cowlitz County, Washington. October XX, 2016 Credit Paper Page 5 of 24 Northwest Innovation Works - Kalama#55DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS - FOR INTERNAL USE ONLY Section 2 Borrower: Project and Loan Summary Sheet Northwest Innovation Works Kalama, LLC Loan Terms Sponsors: Pan-Pacific Energy Corp. Loan Number: 1313 Technology: Johnson Matthey PLC - Ultra Low Emissions (ULE) natural gas heated reformer technology Project Type: Advanced Fossil; Natural Gas to Petrochemicals (Methanol) manufacturing facility Description: Two x 5,000 MTPD (3,650,000 MTPY) grade AA methanol manufacturing trains using North American natural gas (300,000 mmBtu/day) as feedstock. Methanol output sales to highly-rated offtakers (methanol-to- olefins producers located in China) under long-term, price certain contracts. Location: Kalama, Washington (adj. Columbia River) Innovation: Johnson Matthey PLC - Ultra Low Emissions system. Includes a gas heated reformer in series with an auto-thermal reformer which satisfies LPO's innovation requirement. First project with this technology in the US. (b) (5) (b) (5) Title XVII Justification: The Project employs new or significantly improved technologies as compared to commercial technologies in service in the US and will avoid emissions of greenhouse gases. Borrower: Tenor: Interest Rate: Availability: Repayment: Security: LPO Fees Stonepeak Infrastructure Partners, LP Northwest Innovation Works Kalama, LLC (b) (5) Application fee: $400,000 Facility fee: (b) (5) (b) (5) Maintenance fee: $500,000 per calendar year Project Status: (b) (5) (b) (5) Project cost: (b) (5) (b) (5) Sources and Uses (Smm) LPO Credit Rating: (b) (5) LPO Recovery: (b) (5) Credit Agency Rating: (b) (5) Uses of Funds Construction and Financing (b) (5) DSRA Credit Subsidy Cost: (b) (5) Eligible Subtotal Ineligible Subtotal Total Sources of Funds FFB Senior Debt Equity Total FFB Debt as % of Eligible Costs (b) (5) Last Site Visit: October XX, 2016 Credit Paper Page 6 of 24 Northwest Innovation Works - Kalama#56DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS - FOR INTERNAL USE ONLY Section 3 Project Overview 3.1 Project Description Northwest Innovation Works Kalama, LLC ("NWIW” or “Borrower”) proposes to construct and operate a 3.65 million metric tons-per-year natural gas to methanol manufacturing facility. The Project will have production capacity of 10,000 metric tons per day ("MTPD") of AA-grade methanol and will consist of two trains, each with capacity of 5,000 MTPD. The Project will utilize approximately 300,000 mmBtu/day of natural gas as feedstock. The Project is located on 90 acres adjacent to the Columbia River in Kalama, WA (Cowlitz County), approximately 40 miles north of Portland, OR, 65 miles east of the Pacific Ocean and 250 miles south of the Canadian border (at British Columbia). The site includes a deep-water port that will be able to accommodate Aframax-size ships which will transport the Project's methanol to contracted offtakers who are industrial olefins producers and distributors located in coastal China. Figure 3.1 below shows the geographical location of Kalama, WA. Figure 3.1: Map of Kalama, WA BRITISH COLUMBIA Vancouver Kalama, WA Victoria Seattle WASHINGTON Pacific Ocean (b) (5) Portland ALBERTA Edmonton Calgary OREGON IDAHO The Project will employ Johnson Matthey Plc's Ultra Low Emissions ("ULE") technology which includes a gas heated reformer in series with an auto-thermal reformer, and will be constructed under a turnkey, full-wrap Engineering, Procurement and Construction (“EPC”) contract led by Technip USA, Inc. ("Technip"). (b) (5) (b) (5) October XX, 2016 Credit Paper Page 7 of 24 Northwest Innovation Works - Kalama#57DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS - FOR INTERNAL USE ONLY Figure 3.3 below shows the 2015 global allocation of methanol applications. Figure 3.3: Methanol Applications Biodiesel 3% MTO 12% Other 18% Fuel Blending 12% DME 5% MTBE 11% Formaldehyde 29% Acetic Acid 10% Source: Methanex Corp., September 2016 Investor Presentation The methanol industry is most often described in three major segments: (i) core-GDP products; (ii) fuel applications; and (iii) methanol-to-olefins. Methanol-Core-GDP Products Historically demand for methanol focused on the production of formaldehyde, acetic acid, methyl methacrylate and solvents which are referred to as "core-GDP" products given their close demand correlation to global economic activity and industrial production. Core-GDP products are used to manufacture a wide range of products, including plywood, particleboard, foams, resins and plastics. Because these derivatives are used extensively in the construction industry, demand for these derivatives has tended to rise and fall with building and construction cycles, and also in correlation with the level of production of wood products, housing starts, refurbishments and related consumer spending. Historically, methanol pricing has been driven by the cost of production and/or affordability into these major downstream sectors. Accordingly, the methanol industry has been driven by GDP growth, based on demand for core-GDP products which even in times of economic downturn, have shown demand resilience. Methanol - Fuel Applications In the past 15 years methanol use has grown significantly in connection with two primary energy-related fuel applications: (i) Methyl tertiary butyl ether ("MTBE") which is a methanol derivative used as a gasoline oxygenate blend to create higher octane, cleaner burning gasoline; and (ii) Di methyl ether ("DME") which is a cleaner burning fuel alternative to liquid petroleum gas ("LPG"). In the early 2000's the MTBE market grew exponentially due to US government mandated gasoline oxygenate requirements. During this period, MTBE demand accounted for 20%-25% of global methanol consumption and this period marked the beginning of methanol establishing a fuel-value price relationship to crude oil and gasoline. Unfortunately by the mid-2000's, MTBE lost favor as a gasoline blending component in the US due to leaking underground storage tanks ("LUST") and subsequent groundwater contamination. MTBE found its way into underground water tables and is a suspected carcinogen. Lawsuits filed by city municipalities (for fouling underground water aquifers) against major October XX, 2016 Credit Paper Northwest Innovation Works - Kalama Page 9 of 24#58DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS FOR INTERNAL USE ONLY oil companies quickly resulted in the abandonment of MTBE blending in the US. Methanol consumption for MTBE production in the US went from as much as 4 million tons/year to less than 1 million tons/year in a five-year period. Although not specifically banned on a federal level, US refiners and blenders have abandoned MTBE production due to the risk of contamination and liability. The rest of the world continues to blend MTBE, and this oxygenate still contributes significantly to consumption today. While MTBE is produced in the US, the product is exported to other countries, mainly to Latin America. By 2005, China began an aggressive program of blending domestically-produced methanol into its gasoline pool as a way of reducing dependence on imports of energy (crude oil and gasoline). Methanol demand into the Chinese gasoline pool has grown by nearly 30% through the 2005-2015 periods and according to Argus, is expected to see continued strong growth as one of the world's largest consumers of gasoline. Likewise, the Chinese government has supported the production of DME as a LPG blendstock and substitute for the reducing dependence on energy imports. During the 2005-2015 period, methanol demand for DME production grew at an annualized rate of more than 34% and today represents almost 10% of total industry demand. Global MTBE and DME applications have quickly overcome the loss in US MTBE market, and the methanol industry has become much more evenly split between core-GDP products and these energy-use applications. Methanol into energy applications approaches 40% of total methanol consumption, and accordingly pricing continues to have a significant link to crude oil markets. More recently, there has been growing demand for the use of methanol in the shipping industry as an alternative to traditional bunker fuel which is known to be a major pollutant, specifically with regards to sulfur emissions. Argus estimates that many ships (both commercial and passenger) will convert in coming years to meet the more restrictive sulfur emissions regulations on ocean going vessels. (b) (5) (b) (5) Another developing market for methanol is its use as a potential hydrogen carrier for many developing fuel cell applications. Methanol-to-olefins The term 'olefins', also known as alkenes, refers to a large number of compounds that contain carbon and hydrogen and have at least one double bond in their chemical structure. The primary olefins are ethylene and propylene and are commonly used as a feedstock in the production of polymers (i.e., polypropylene and polyethylene) which are building block of plastics. Polypropylene is used in films, packaging, caps and closures as well as other applications. Polyethylene is commonly used in rigid containers and plastic film applications such as plastic bags and film wrap. The methanol-to-olefins ("MTO") market has emerged in recent years as a rapidly growing application for methanol. The Project will sell its methanol to producers in coastal China who will use the methanol as an intermediary feedstock for olefins production. MTO demand growth has come primarily from Chinese producers who have historically relied on either the coal-to-olefins ("CTO") process or naptha- based olefins supply. However the use of both of these processes has come under severe scrutiny due to anthropogenic emissions and air and water quality issues which the national government of China is aggressively trying to curtail. MTO is an attractive alternative for the Chinese market due to naphtha- based olefins production generally being the most costly approach, and due to the logistical challenges associated with CTO production in China where the majority of the coal supply is located in the October XX, 2016 Credit Paper Northwest Innovation Works - Kalama Page 10 of 24#59DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS FOR INTERNAL USE ONLY mountainous inner regions where transportation and water options are limited. Furthermore, coal and oil supplies are subject to curtailment in China, particularly during the winter months, when they are needed first for heating purposes. (b) (5) (b) (5) Today, the MTO market relies completely on the merchant methanol industry for raw material supply, which like any commodity in a merchant market, is subject to price volatility and supply fluctuations. (b) (5) (b) (5) (b) (5) For the 2015-2020 period alone, MTO-based methanol demand is expected to grow in excess of 6 million tons -- the equivalent of three world scale methanol units (sized at 1.8 million tons/year). Even in today's low crude oil price environment which would conceivably make naptha-based olefins production attractive, MTO units are expected to operate and consume as much as three tons of methanol for each one ton of olefins produced. By example, a small 600,000 tons/year olefins unit requires 1.8 million tons/year of methanol (which is the size of the largest existing methanol unit in the world today), approximately 3% of total methanol demand (excluding CTO). Global methanol demand for MTO production totaled about 400,000 tons in 2011-its inception year. In 2015 methanol consumption into MTO approached 7 million tons (which represents 16% of China merchant methanol demand and 9% of world demand, excluding CTO). Global methanol supply and demand The methanol industry spans the entire globe, with production in Asia, North and South America, Europe, Africa and the Middle East. Worldwide over 350 methanol plants have combined annual production capacity in excess of 100 million metric tons (almost 40 billion US gallons), and each day more than 100,000 tons of methanol is used as a chemical feedstock or as a transportation fuel. Methanol is one of the top five widely traded bulk chemical commodities with over 80,000 metric tons shipped daily from one continent to another. According to the Methanol Institute, the global methanol industry generates $36 billion in economic activity each year and creates 100,000 jobs around the world. Figure 3.4 shows 2015 methanol demand and supply by region. Figure 3.4: Methanol Demand and Supply (2015) (b) (5) Asia 63% 2015E Methanol Supply by Major Region (-000-metric tons) North America 4% South America 10% 2015 Methanol Demand by Major Region Europe 3% North America 18% Europe 11% Middle East Rest of the World 13% 7% Asia Pacific mmsa (ex. China). 19% Latin America 3% China 49% October XX, 2016 Credit Paper Page 11 of 24 Northwest Innovation Works - Kalama#60DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS - FOR INTERNAL USE ONLY The supply dynamics of the global methanol industry are undergoing a significant transition. For decades, methanol industry supply was dominated by the US, South America and Europe's production base. China methanol production was small-as was its consumption—and the large quantities of natural gas ultimately discovered in the Middle East had yet to be commercialized. In 2000, the North and South American hubs were the largest producing regions, supplying 44% of the global market. In the early 2000's, the Middle East began converting low-cost "stranded" natural gas to methanol, leading to the diminishing of US and European production. After 2007, the Middle East and South American production blocks began gaining market share, and the Atlantic Basin became the largest importer of methanol in the world. Today, new methanol capacity has been announced globally but limited projects have reached final investment decision ("FID") or start of construction. Some new methanol capacity is anticipated in China, but this capacity is expected to face many issues, including environmental, water supply and high natural gas costs. Russia, Canada, Israel, Iran, Australia and Trinidad & Tobago have planned new capacity but US capacity, primarily in the Gulf of Mexico, is far more advanced in planning and construction. The methanol industry has a concentrated consumer demand base with 30% of demand coming from the top 20 consumers worldwide. Among these are large chemical companies including: Methanex Corp., BP plc, Dow Corning, Celanese Corp., Momentive Performance Materials, Inc. and Saudi Arabia Basic Industries Corp. ("SABIC"). China's demand for methanol dominates global markets. China represented nearly 54% of total methanol industry production and 62% of demand in 2015 (excluding CTO). Given China's massive population, and its transition from a production to a consumption economy, the derivative slate for methanol is more diverse than any other country in the world. While Chinese GDP growth is expected to be conservative, China's economy is still expected to grow faster than the rest of the world and continue to support methanol demand growth (even at lower GDP growth rates in the mid-single digits). China's 62% of world methanol demand is forecast to remain mostly stable through 2040 as other world fuel applications increase proportionately (excluding CTO). Figure 3.5 shows China's methanol demand forecast, as estimated by Argus. Figure 3.5: China methanol demand forecast metric tons (mm) 180 160 140 120 100 TT 86420 2015 2016 2017 2018 2019 | Global Production. 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 I All Other Merchant MTO/MTP Captive MTO/MTP Dimethyl Ether Fuel Applications Biodiesel MTBE & TAME Methylamines Methyl Methacrylate Dimethyl Terepthalate Acetic Acid Formaldehyde Source: Argus October XX, 2016 Credit Paper Northwest Innovation Works - Kalama Page 12 of 24#61DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS - FOR INTERNAL USE ONLY In 2015, global methanol capacity totaled 109 million metric tons (excluding CTO), with a total production of 76 million metric tons, implying a global utilization rate of 70%. China methanol industry operating rates are relatively low for many reasons. First, the country has overbuilt capacity in the last decade-much of which has been at the high end of the industry cash-cost structure. Also, about 20% of China's methanol capacity uses by-product coking gas as feedstock. This coking gas is the by-product of steel coking. As steel demand and production fluctuates, so does the availability of coking gas. In 2015, the steel industry operated near 50% capacity and China is currently rationalizing its overbuilt steel industry. This may result in some methanol capacity losing its feedstock and ceasing operations. China's remaining methanol capacity is split between 60% coal feedstock and 20% natural gas feedstock. During the winter, both are subject to feedstock curtailments, as the government will preferentially allocate coal and/or natural gas to heating needs—regardless of industry needs. After the long northwestern region winter, many of the large coal-based methanol units take month-long outages. The increased mechanical complexity of coal-based technology also takes a toll on operating performance. Global demand for MTO Global methanol demand for MTO and methanol-to-propylene ("MTP") production totaled about 400,000 metric tons in 2011 (its inception year). Methanol consumption into MTO in 2015 approached 7 million tons (16% of China merchant methanol demand and 9% of world demand, excluding CTO). Across 2016-2020, Argus estimates that China will add approximately 4 million tons/year of MTO/MTP capacity potentially consuming 12 million tons/year of methanol as a raw material sourced from the merchant market. Based on current Argus estimates, MTO methanol demand will grow from 7.8 million tons in 2015 to 19.5 million tons in 2040 (nearly 21% of total industry demand, excluding CTO). Argus estimates as many as seven new MTO/MTP units will be built and operational in China during the 2016-2020 period. Many of these new complexes are under construction and/or have received government approval to proceed. Many more plans to build new units have been announced, but these have not started construction and could be delayed until oil prices rise. Argus expects the current spate of new builds (including the Project) to satisfy olefin industry demand until the 2025 timeframe. Figure 3.6 below shows Argus projections for growth in the MTO/MTP industry. Figure 3.6: Methanol-to-olefins (MTO)/methanol-to-propylene (MTP) industry October XX, 2016 '000t 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Credit Paper Northwest Innovation Works - Kalama MTP MTO Source: Argus Page 13 of 24#62(b) (4) DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS FOR INTERNAL USE ONLY Offtake and Shipping (b) (5) (b) (5) See Section 3.8 below for a detailed discussion on the Project's offtake and shipping plans. Feedstock The Project will utilize approximately 300,000 mmBtu/day of natural gas (10,000 tons per day) as feedstock. (b) (5) (b) (5) (b) (5) Technology The Project will employ Johnson Matthey's ultralow emissions ("ULE”) reforming technology to process natural gas. The ULE reforming technology is significantly more efficient and produces fewer air emissions, including CO2, than conventional reforming technologies (b) (5) (b) (5) The ULE reforming technology comprises a Gas Heated Reformer ("GHR") and Autothermal Reformer ("ATR") in combination. (b) (5) (b) (5) See Section 3.4 below for a detailed discussion of the Project's technology. October XX, 2016 Credit Paper Page 14 of 24 Northwest Innovation Works - Kalama#63DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS FOR INTERNAL USE ONLY Engineering, Procurement and Construction NWIW indicates that it has selected the Engineering, Procurement and Construction ("EPC”) contractor to be a joint venture between Technip USA, Inc. (“Technip"), URS Energy & Construction, Inc. (“AECOM”) and HQC USA LLC (“PetroChina") (collectively, the “EPC JV"). (b) (5) (b) (5) Technip: AECOM: PetroChina: Lead party; basic engineering and a portion of the detailed engineering, as well as procurement services for international supply Power block engineering and procurement services, construction management and construction labor Procurement services for Chinese supply and a portion of the detailed engineering JV Combined: Project management, procurement, module fabrication, construction management and site support subcontracts, commissioning and performance testing See Sections 3.5 and 3.6 below for detailed discussion of construction and operations. [ ] October XX, 2016 Credit Paper Page 15 of 24 Northwest Innovation Works - Kalama#64DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS FOR INTERNAL USE ONLY 3.2 Project Structure Figure 3.7 below shows the proposed expected Project structure at financial close. Figure 3.7: Proposed Project Structure (b) (5) 3.3 Project Sponsors At Financial Close, the Project is expected to be owned by (b) (5) Pan-Pacific Energy Corp. ("PPE") and (b) (5) Stonepeak Infrastructure Partners, LP ("Stonepeak") (collectively, the "Sponsors"). PPE is a Delaware domiciled corporation majority owned by Shanghai Bi Ke Clean Energy Technology Co., Ltd., (also known as Clean Energy Commercialization Company ("CECC")), a China registered company headquartered in Shanghai, China. Stonepeak is a New York based infrastructure private equity fund with over $5 billion in assets under management. The Borrower is a Delaware corporation formed to develop, construct, own and operate the Project. NWIW will be capitalized by PPE and Stonepeak according to the ownership percentages specified above. PPE PPE was established by Shanghai Bi Ke Clean Energy Technology Co., Ltd. ("CECC") in 2013, as a U.S. Delaware Corporation, to develop projects focusing on an integrated gas value chain in the US Pacific Northwest. CECC's shareholders include the following: ■ Chinese Academy of Science Holdings Co. Ltd ("CAS Holdings") - wholly owned state company and private equity arm of the Chinese Academy of Sciences, China's October XX, 2016 Credit Paper Northwest Innovation Works - Kalama Page 16 of 24#65DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS FOR INTERNAL USE ONLY (b) (4) leading academic and research organization. (b) (4) Double Green Bridge Hong Kong Limited (“DGB") -(b) (4) (b) (4) Johnson Matthey Public Limited Company ("JM") - a British multinational chemicals and sustainable technologies company with operations in over 30 countries. JM's primary industries include environmental, automotive, chemical, pharmaceutical / medical, recycling, and oil, gas and refineries. According to JM's 2015 financials, the company generated over £3,125 million in revenue, with £591 million from its Process Technologies Division, which serves as a global supplier of catalysts, licensing, technologies and other services to the syngas, biochemical, petrochemical, oil refining and gas proces n had an underlying operating profit of £106 million. (b) (4) Stonepeak Infrastructure Partners, LP (b) (4) Stonepeak is a North America focused private equity firm investing in the energy, power and renewables, transportation, utilities, water and communications sectors. Stonepeak manages $5.7 billion of capital for its investors. In January 2016, Stonepeak closed its second fund, Stonepeak Infrastructure Fund II, at a hard cap of $3.5 billion. 3.4 Technology (b) (5) 3.5 Construction (b) (5) 3.6 Operations (b) (5) October XX, 2016 Credit Paper Page 17 of 24 Northwest Innovation Works - Kalama#66DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS - FOR INTERNAL USE ONLY 3.7 Feedstock Natural Gas (b) (5) Table 3.8 below shows the key terms of the (b) (5) Table 3.8: Key terms of natural gas supply term sheets Counterparty (b) (5) Term Volume Capacity Pricing (b) (4) October XX, 2016 Credit Paper Page 18 of 24 Northwest Innovation Works - Kalama#67DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS - FOR INTERNAL USE ONLY (b) (5) .(b) (4) Natural Gas Pipeline (b) (5) Electricity NWIW has indicated that the facility will require 200MW of electricity annually (b) (5) (b) (5) (b) (5) The terms are summarized in Table 3.9 below. Table 3.9: Key terms of electricity supply term sheets Counterparty (b) (4) Quantity Cost Duration October XX, 2016 Credit Paper Page 19 of 24 Northwest Innovation Works - Kalama#68DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS - FOR INTERNAL USE ONLY 3.8 Offtake and Shipping [note: include summary of (b) (5) ] (b) (5) Offtake (b) (4) (b) (5) (b)(5) Table 3.10 below shows a summary of the key terms of the offtake arrangements as conveyed by NWIW. Table 3.10: Offtake terms summarv (b) (4) (b) (4) October XX, 2016 Credit Paper Page 20 of 24 Northwest Innovation Works - Kalama#69(b) (5) DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS FOR INTERNAL USE ONLY Shipping [note: to be updated with (b) (5) 3.9 Environmental/Land/Regulatory/IP [note: to include(b) (5) The final Environmental Impact Statement ("EIS") for the Project was released on September 30, 2016 by the Port of Kalama and Cowlitz County. A 20 day appeal period is underway. The final EIS will form the basis for the project's permits to be issued and for the federal reviews to be completed.] October XX, 2016 Credit Paper Northwest Innovation Works - Kalama Page 21 of 24#70DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS FOR INTERNAL USE ONLY Section 4 Financial Structure Overview [to be provided: to include summary of (b) (5) October XX, 2016 Credit Paper Page 22 of 24 Northwest Innovation Works - Kalama#71DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS FOR INTERNAL USE ONLY Section 5 Risks and Mitigants The following are the main risks and mitigants: (b) (5) October XX, 2016 Credit Paper Page 23 of 24 Northwest Innovation Works - Kalama#72DRAFT as of 12/29/2017 CONTAINS BUSINESS CONFIDENTIAL INFORMATION PREDECISIONAL & DELIBERATIVE PROCESS FOR INTERNAL USE ONLY Section 6 Risk and Recovery Matrix Summary [note: include summary of (b) (5) ]]] October XX, 2016 Credit Paper Page 24 of 24 Northwest Innovation Works - Kalama#73| (b) (5) (b) (5) Document 6#74(b) (5) (b) (5) 2#753. (b) (5) (b) (5)#76| (b) (5) (b) (5) 4#77(b) (5) (b) (5) 5#78(b) (5) Exhibit 1 6 (b) (5)#79(b) (5)#80Draft as of 5/5/2016 2 3 4 5 6 Northwest Innovation Works - Kalama LPO DUE DILIGENCE SCHEDULE T 8 (b) (5) 9 10 9 # # 13 14 15 16 17 18 Document 7 CONFIDENTIAL DRAFT FOR INTERNAL DISCUSSION PURPOSES ONLY 2016 LEGEND Milestone JUNE S M T W T F S S M T JULY W AUGUST T F S S M T W T F 5 1 2 3 4 5 1 3 1 2 3 4 5 °° 7 6 7 8 9 10 11 12 4 S 6 7 9 10 9 ° 10 11 12 13 14 Deliverable 13 14 15 16 17 18 19 11 12 13 14 15 16 17 15 16 17 18 19 20 21 20 21 22 23 24 25 26 18 19 20 21 22 23 24 22 23 24 25 26 27 28 Process 27 28 29 30 25 26 27 28 29 30 31 29 30 31 5/30/2016 2 6/6/2016 3 6/13/2016 4 6/20/2016 6/27/2016 S 6 7/4/2016 7/11/2016 7/18/2015 7/25/2016 9 20 8/2/2016 8/8/2016 3/15/2016 8/22/2016 21 22 13 14 <e!e ACTIVITY RESPONSIBILITY START DATE DURATION (week of (in weeks) END DATE (week of) Week of Week no. 1 (b) (5)#81NWIW Major Due Diligence Documents Delivery to DOE NWIW ETA to DOE(date) Document Received by DOE(date) Document EPC (b) (5) Offtake (b) (5) Feedstock NG Supply (b) (5) NG Transport (b) (5) Power Supply (b) (5)#82Shipping (b) (5) Financial Model Equity (b) (5) (b) (5)