Flex LNG reveals another charter deal

Norwegian shipping firm Flex LNG said it has signed another charter deal for one of its thirteen LNG carriers.

The 2021-built 173,400-cbm Flex Freedom will go on charter to an “LNG portfolio player” for a minimum firm period of either three or five years, according to the firm controlled by billionaire John Fredriksen.

Flex LNG signed the fixed-rate charter deal on Thursday, the firm said in its first-quarter report.

The deal will start in the first or second quarter of 2022 in direct continuation of its existing time charter. Flex LNG said the charterer would declare the firm period in the third quarter this year.

In addition, the charterer has the option to extend the period by an additional two years bringing the total period to five or seven years.

“The time charter agreement remains subject to final documentation as well as customary closing conditions,” Flex LNG said.

This is the third deal for Flex in a short period following the charter of four carriers to a unit of US exporter Cheniere, and the most recent deal for Flex Constellation.

Flex LNG currently has 12 carriers on the water and expects to take delivery of the 13th vessel later this month.

All existing Flex LNG ships have a cargo capacity of about 173,400 to 174,000 cubic meters and feature dual-fuel two-stroke propulsion including MEGI and X-DF.

“Best quarterly results so far”

Flex LNG’s chief Øystein Kalleklev said the company achieved its “best quarterly results so far” with vessel operating revenues and adjusted net income of $81.3 million and $34.2 million, respectively.

Flex LNG reported an average time charter equivalent (TCE) rate of $75,399 per day for the first quarter, compared to $73,712 per day for the fourth quarter last year.

“Due to a stronger market and increased term interest by charterers, we are also very satisfied that we have been able to execute on our communicated strategy of securing longer employment for our fleet of modern and efficient LNG carriers,” he said.

“Since reporting our fourth quarter results in February, we have agreed several attractive fixed hire term employment contracts for our vessels with an addition of an aggregate 22 years of minimum backlog secured,” Kalleklev said.

This provides Flex with “strong earnings visibility with about 88% of the days from the second quarter to the year-end already covered,” he said.

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