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Staubo said during Golar’s third-quarter earnings call on Wendesday that the company remains on track to decide on the vessel design for its fourth FLNG conversion in the coming months.
Golar has entered into contracts with the three shipyards for its MKI, MKII, and MKIII FLNG designs to obtain updated pricing, delivery, and payment terms for a contemplated 4th FLNG order.
If Golar is to proceed with an MKI FLNG with a capacity of 2 to 2.7 mtpa, Seatrium will be the shipyard selection for the company’s next FLNG.
Moreover, Golar has an option for a second MKII FLNG with a capacity of up to 3.5 mtpa with CIMC Raffles, while the MKIII design includes a newbuild vessel built by South Korea’s Samsung Heavy Industries.
Staubo said the Mark I design is the same design as both Hilli and Gimi.
“It’s a proven design, we know it well and the current pricing works and aligns with some of the commercial discussions ongoing,” he said.
The Mark II would be a repeat of the vessel currently under construction at the CIMC Raffles yard, and “we are pleased to reconfirm time and price with the shipyard.”
“We’ve also spent a considerable amount of time getting an updated price, time, and schedule for the Mark III, and we continue to see yard pressure for attractive slots and delivery times,” he said.
“We do think that timing is of the essence if you want to lock in attractive delivery. The key pressure item for the delivery of all three assets are long lead items,” Staubo said.
He said these long lead items see “significant” pressure both on delivery and price, mainly driven by the AI data center boom in the US.
“We now see relatively new entrants into some of these suppliers where companies like Google, Alphabet, Meta, and so on are ordering gas turbines in large quantities, putting price pressure and delivery pressure,” he said.
“Being an existing large and long-term client of these suppliers helps us in securing attractive slots despite the increased competitive landscape. We have therefore gotten board approval to enter into long lead items during this quarter and we expect to do so in the coming weeks and months to safeguard the delivery times now confirmed by the shipyards through over the course of the last few months,” Staubo said.
Opportunities
Stabo also answered a question during the call about the commercial opportunities relative to each of the three options and the long lead items.
“When we make the slot reservation and commitments to the long leads, it is interchangeable and therefore the reason for going ahead with that now is that is still flexible to design, subject to the deciding design in the next coming months. That is where we are targeting,” Staubo said.
“Where we see the smaller one, the Mark I, that is West Africa business. The way we see it, Mark II is more versatile in terms of geography,” Staubo said.
“Mark III effectively currently has two projects that we’re working on, so that it’s fewer projects than the other two,” he said.
“We’re now planning to narrow that range to decide on which vessel to go for,” Staubo said.
