Hoegh LNG hunting FSRU contracts for three units

Norwegian floating player Hoegh is looking to find long-term work for three of its FSRUs currently trading as LNG carriers.

The company has currently five FSRUs working as LNG carriers and with contracts expiring in 2021.

FSRUs Hoegh Gallant, Hoegh Gannet are currently working under a 7-month and a 12 month-charter while Hoegh Giant serves its 15-month contract with Naturgy.

Hoegh Esperanza is operating as an FSU at Tianjin in China and will not start regasification operations until the winter season.

Charter contracts for Giant, Esperanza, and Gannet come with an extension option.

If exercised, these units would be fully employed into 2022, chief Sveinung Stohle said on Wednesday discussing Hoegh’s quarterly results.

Nine projects in the pipeline

Stohle said that the firm has nine projects in the pipeline including two in Australia, AIE’s Port Kembla and AGL’s Crib Point.

These projects have starting dates from 2021 to 2023, but most of them should launch in mid-2022.

For the Australian projects, the firm already plans the Hoegh Esperanza and the Hoegh Galeon that currently serves Cheniere.

However, both of these developments are still a subject to a final investment decision.

Aside with that, this means that the other three FSRUs could go on long-term charter to one of the remaining seven mentioned projects.

These include two FSRU projects in India, and developments in Latin America, Cyprus, and Philippines.

According to Stohle, besides the Australian projects, the First Gen project in the Philippines and the South American development are the “most advanced”.

This gives a big optimism to the firm to secure contracts for all the FSRUs given the number of projects in pipeline and the fact that Hoegh has been selected as preferred bidder for four of these.

“We are very comfortable with securing these contracts,” Stohle said.

He added all of these contracts, except one, will be eligible for a potential dropdown to the company’s New York-partnership as their duration would go up to 10 years.

Looking at results, Hoegh LNG logged a net profit of $2.9 million in the second quarter compared to a net loss both in the previous quarter and the comparable quarter in 2019.

EBITDA of $57.7 million also increased year-on-year but was slightly down compared to $59.5 in the previous quarter.

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