Introduction

Nakilat (which means "carriers" in Arabic) is a Qatari shipping company that forms an integral link of the LNG supply chain for the State of Qatar. It was established in 2004 and is a joint stock company owned 50% by its founding shareholders and 50% by the public as a result of an IPO in 2005.

Nakilat is building a large fleet of vessels to transport LNG produced from Qatar's North Field, the world's largest non-associated gas field with approximately 15% of the world's proven reserves, to global markets. By 2010, Nakilat will own 54 LNG vessels, making it the largest LNG ship owner in the world.

Throughout 2008, Nakilat continued the development and building of our important partnerships with our key joint venture companies which together own and operate 29 liquefied natural gas (LNG) carriers, ranging in capacity from "145,000m to 216,000m". Nakilat's ownership percentage of these partnership vessels range between 20% and 60% an average 43% interest. As of the end of December 2008, 28 of these vessels had been delivered; the final vessel will be delivered in 2009.

In addition to the 29 jointly-owned vessels Nakilat has 25 wholly-owned LNG carriers. All of these ships, ordered from Korean shipyards, incorporate the latest technology for safe, reliable and costeffective transportation of LNG over many years, and are the result of several years of engineering design work and testing. As of March 31, 2009 eleven of the wholly-owned ships have been received from the ship yards and 14 remain to be delivered. These 25 wholly-owned vessels represent a total investment by Nakilat of approximately US $7.5 billion.

In total, Nakilat's LNG fleet will include 54 LNG carriers comprised of 9 conventional vessels (145,000-154,000m), 31 Q-Flex vessels (210,000-216,000m) and 14 QMax vessels (263,000-266,000m). The Q-Flex has approximately 50% and the larger Q-Max has over 80% more capacity than conventional LNG carriers and consume 40% less energy. They are the world's largest and most advanced LNG carriers.

Together, Nakilat's jointly and whollyowned fleet of 54 vessels represent a total investment of approximately $11 billion. In addition to the 54 LNG vessels Nakilat and Qatar Shipping Company Ltd. (QShip), through a Joint Venture Agreement established a special purpose company, "Gulf LPG Transport Company W.L.L." to build and own 4 Very Large Gas Carriers (VLGC's). Nakilat and Q-Ship each has 50% share in the ships built at Hyundai Heavy Industries Co., Ltd., Korea. All 4 ships were delivered by March 2009.

The following are some of the notable achievements realized by Nakilat in 2008:

LNG Ship Naming Ceremonies:
LNG Ship Deliveries:
Four Q-Max were delivered in 2008:
In September, "Mozah", the world's largest LNG carrier was delivered to Nakilat at Samsung. "Mozah" is the very first of 14 Q-Max ships and is also the first of Nakilat's 25 whollyowned LNG carriers.
"Umm Slal" and "Bu Samra" were also delivered at SHI and Al Ghuwairiya was delivered at Daewoo.
It is also note worthy to mention that Nakilat celebrated the safe arrival of the first Q-Flex LNG carrier to the United States. "Al Gharrafa" discharged her cargo at the newly commissioned Sabine Pass LNG Terminal in Louisiana and was the largest LNG carrier to ever transit the Sabine Channel.
Liquid Petroleum Gas (LPG) Ships:
Nakilat and Q-Ship named 4 Very Large Gas Carriers (VLGC's), "Bu Sidra", "Umm Laqhab", "Al Wukir" and "Lubara" at naming ceremonies held at Hyundai. The 4 VLGC's are owned through a 50:50 joint venture between Nakilat and Q-Ship named "Gulf LPG Transport Company W.L.L.". All ships were delivered by March 2009.
The vessels are commercially employed under a Joint Operating Venture between Gulf LPG and MOL.
Ship Repair Yard:
In 2007, Nakilat and Qatar Petroleum finalized the definition of the fivephase strategy to develop facilities for the construction and maintenance of a wide range of marine and offshore structures.

During 2008, implementation of the strategy proceeded according to plan. The centre point is a large Ship Repair Yard, designed for the repair and maintenance of very large LNG carriers and a wide range of other vessels, as well as the conversion of tankers to Floating Production, Storage and Offloading (FPSO) and Floating Storage and Offloading (FSO) units.

The 43-hectare Ship Repair Yard, built on reclaimed land, is part of the massive expansion of the Port of Ras Laffan, and is scheduled to begin operations in 2010. Work also commenced in 2008 on building a Ship Construction Facility for small, high-value vessels, and is scheduled for completion in late 2009.
Major Contract Awards:
Nakilat awarded a major contract to Hyundai Samho Heavy Industries Company Limited and Hyundai Corporation (acting collectively as the contractor) for ten (10) jib cranes. The cranes are required for operation alongside the quays and dry-docks of Nakilat's new world-class shipyard which is being built in the Port of Ras Laffan.
Nakilat signed an agreement with WOQOD to supply marine lubricants and technical services to Nakilat's fleet of 25 wholly-owned LNG carriers. The agreement includes the supply of both the initial fill volumes required by the shipyards prior to delivery of each vessel and the top up volumes required for operations by the fleet on a global basis.

Nakilat entered the first fifteen of its wholly owned LNG vessels with the two largest P&I clubs in the world " Assuranceforeningen Gard and The Standard Club. The announcement marked the conclusion of a detailed selection process culminating in a closed bid competitive tender by a shortlist of international P&I clubs.
Finance:
Nakilat successfully raised US$1.5 billion of debt under its existing program financing from a group of 12 international and regional banks, together with Korean Export Insurance 10 Corporation (KEIC). The incurrence of this debt will keep Nakilat adequately funded and solidly on track to complete its acquisition of a fleet of 25 LNG vessels currently under construction at the Korean shipyards.
The senior secured debt rating and the subordinated secured debt rating of "A+" and "A" by S&P respectively, and "Aa2" and "Aa3" by Moody"s respectively, were maintained in an increasingly deteriorating market. Nakilat completed $1.5 billion financing in difficult market conditions once again proving Nakilat's prime status in today's financial market.

In support of its vessel operations Nakilat also has two additional companies, Nakilat Agency Company and Nakilat Svitzerwijsmuller.

The Nakilat Agency Company acts as the exclusive "full port agency service" for all local and international ships calling at the Port of Ras Laffan.

The business is diverse and the agency attends to all port and regulatory matters to ensure the most effective turnaround of ships loading or offloading at Ras Laffan.

Nakilat Svitzerwijsmuller, a joint venture between Nakilat and Svitzer Middle East, owns and operates 21 vessels, tug boats, pilot boats and other harbor craft at the Port of Ras Laffan. This equipment is deployed under a 22-year Harbour Towage and Mooring services contract which was awarded in 2006.

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