Golar in European FSRU charter talks, working on new FLNG projects

Tor Olav Troim-led Golar LNG is in talks to deploy its sole floating storage and regasification unit in Europe, as European countries look to phase out Russian gas supplies.

Golar recently signed a deal with Italian energy firm Snam to supply a converted FSRU for the latter’s project in the port area of Portovesme, Sardinia.

Under the deal, the firm would convert its 2003-built steam LNG carrier, Golar Arctic, into an FSRU with storage capacity for up to 140,000 cubic meters.

This is the only carrier in Golar’s fleet as it sold eight vessels to the new shipping firm CoolCo it formed with Idan Ofer’s EPS.

Golar, that is now focusing on its FLNG business, also owns one FSRU. The 2015-built 170,000-cbm Golar Tundra has a capacity of about 5 bcm/year.

The LNG firm said in its first-quarter report that developments in Europe have created an “urgent need” for more floating LNG terminals.

“Golar has received multiple approaches from European governments and utility companies for its modern high-spec FSRU Golar Tundra,” it said.

Golar did not provide additional information regarding the talks.

It reported a net income of $345.2 million and Adjusted Ebitda of $93.4 million for the quarter.

Cameroon FLNG ups production

Golar also said that the world’s first converted FLNG vessel, Hilli Episeyo, has boosted its production volume to 1.4 mtpa offshore Cameroon.

Hilli Episeyo started commercial operations in May 2018 under production tolling deals with Cameroon’s Perenco and SNH.

Russia’s Gazprom is the sole offtaker from the FLNG project taking 1.2 mtpa under an eight-year deal expiring in 2026.

Moreover, the gas giant is taking 50 percent of the vessel’s total 2.4 mtpa capacity produced from two trains. The FLNG has in total four trains installed onboard.

Golar revealed last year it had finally agreed to boost utilization of the FLNG by 200,000 tons with Perenco and SNH.

The company said on Thursday that the FLNG had maintained its unbroken 4-year record of 100 percent uptime during the quarter and started to produce its incremental 0.2 mtpa of production, boosting the total to 1.4 mtpa.

Golar said the incremental 0.2 mtpa that has a tariff linked to Dutch TTF gas prices contributed $22.6 million of incremental proceeds net of commodity swaps to the firm during the quarter.

The Brent oil-linked component of the tariff contributed $15.6 million, bringing Golar’s pro-rata share of gross proceeds from Hilli for the quarter to $64 million, it said.

New FLNG projects

In February, Golar said it was expecting to win a new contract for a floating LNG producer this year. The firm also developed three different FLNG designs.

“We are in detailed discussions with existing and prospective clients for new FLNG projects,” Golar said in the quarterly report.

Also, some of these projects would offer direct access to gas molecules or allow for a commodity linked earnings component, whilst others are on a tolling basis, it said.

“Based on envisioned funding and ownership structures we expect that our total Golar cash and listed securities position could fund two FLNG growth projects, it said.

In addition to these talks, Golar said in the quarterly report that the conversion work of its Gimi had reached 83 percent completion.

The 2.5 mtpa Gimi FLNG should start serving BP’s Greater Tortue Ahmeyim project under a 20-year deal in the fourth quarter of the next year.

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