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The company currently operates the 2.4 mtpa Hilli, which works offshore Cameroon, and the 2.7 mtpa Hilli, which will soon start serving BP’s Greater Tortue Ahmeyim FLNG project offshore Mauritania and Senegal.
In addition, Golar recently signed an EPC agreement with China’s CIMC Raffles to convert its 148,000-cbm Moss-type carrier, Fuji LNG, into an MKII FLNG with a capacity of 3.5 mtpa. The deal is worth $1.6 billion.
The Golar MK II design is an evolution of the MK I design of FLNG Hilli and FLNG Gimi.
According to Golar’s third-quarter report on Tuesday, it continues to make “significant positive progress” on its other FLNG commercial opportunities.
“We are progressing commercial and technical work on FLNG projects in the Americas, West Africa, the Middle East, and Southeast Asia,” the company said.
Golar noted these commercial opportunities are at various stages of development.
“We target to secure a charter for our MKII FLNG within 2025. Once a charter is secured for the MKII FLNG under construction Golar will seek asset level debt financing for the unit, targeting about 4-6x contracted Ebitda,” it said.
Tortue FLNG commissioning
Golar also provided an update regarding BP’s delayed Greater Tortue Ahmeyim project located offshore Mauritania and Senegal.
In August, Golar and BP resolved a dispute related to daily payments for Golar’s converted FLNG Gimi.
The floating LNG player is now contractually entitled to receive daily payments from January 10, 2024 until the commercial operations date (COD).
In February, the 2.5 mtpa FLNG, which was converted from a 1975-built Moss LNG carrier with a storage capacity of 125,000 cbm, arrived at the GTA hub.
After that, the project’s floating production, storage, and offloading (FPSO) unit also arrived at the GTA project off the coasts of Mauritania and Senegal in May.
Project partner Kosmos Energy recently said it expects the FLNG to start production around the end of the fourth quarter.
Golar noted in the report that BP and and Kosmos agreed to use an LNG cargo to accelerate the commissioning schedule.
In October, the LNG carrier British Sponsor started to introduce gas to the FLNG Gimi.
“FLNG commissioning is now underway and will continue to utilize gas from the accelerated commissioning cargo until the BP FPSO is ready to send gas to the FLNG Gimi. Commissioning activity will then further ramp up,” Golar said.
COD in H1 2025
Based on the latest project schedule, COD is expected within the first half of 2025, Golar said.
“COD will trigger the start of the 20-year lease and operate agreement that unlocks the equivalent of around $3 billion of Adjusted Ebitda backlog (Golar’s share) and recognition of contractual payments comprised of capital and operating elements in both the balance sheet and income statement,” the company said.
Golar also noted that the contemplated refinancing of the FLNG Gimi is progressing, targeting a new increased debt facility with a lower margin and improved amortization profile versus the current vessel debt facility and potentially releasing significant liquidity to Golar.
According to Golar, credit approvals are being received and detailed documentation has started.
Golar said execution of the facility will be subject to remaining credit approvals and finalizing documentation.
FLNG Hilli
Golar LNG said the FLNG Hilli, located offshore Cameroon’s Kribi, is offloading its 122nd cargo of liquefied natural gas since it started operations in 2018.
The unit maintained “market leading operational track record, generating $73 million of Q3 distributable adjusted Ebitda, of which Golar’s share was $68 million,” it said.
In July, Golar LNG entered into definitive agreements with Argentina’s Pan American Energy for a 20-year deployment of this FLNG in Argentina.
The FLNG project will monetize Argentine gas, tapping into the vast resources from the Vaca Muerta shale formation in the Neuquina Basin, the world’s second-largest shale gas resources.
Golar expects the project to start LNG exports within 2027.
The company said in the report the definitive contracts are subject to satisfying defined conditions precedent, including an export license, environmental assessment, and FID by PAE.
“Work on the conditions precedent is progressing with their satisfaction and FID is expected within Q1 2025,” Golar said.
Moreover, PAE issued a reservation notice reserving the FLNG Hilli for the project in October 2024.
“This includes a reservation fee should the project not materialize, and ends Golar’s option to nominate an alternative FLNG to service the contract,” the company said.
Golar said the FLNG project will initially utilize spare capacity in Argentina’s existing pipeline network.
Work to construct a dedicated pipeline connecting the FLNG terminal location directly to the Vaca Muerta shale formation is also being pursued.
“This could support a multi-FLNG vessel project in Argentina, including opportunities for our MKII FLNG(s),” Golar said.
Results
Golar reported a third-quarter net loss of $36 million, before non-controlling interests, inclusive of $90 million of non-cash losses.
Excluding $90 million of market-adjusted non-cash items, Golar reported a net profit of $54 million, and an adjusted Ebitda of $59 million.
As of September 30, 2024, total Golar cash was $807 million, comprised of $732 million of cash and cash equivalents and $75 million of restricted cash.
Golar declared a dividend of $0.25 per share for the quarter.