Golar LNG posts $65.8 million net loss in Q1

Golar Mazo at Yung-An LNG terminal (Image courtesy of Golar LNG)

Bermuda-based Golar LNG on Wednesday reported a net loss of $65.8 million for the first quarter of this year.

Golar’s total operating revenues were at $25.1 million in the first quarter versus $23 million in the previous quarter.

The LNG shipping company said the shipping market remained weak in the quarter under review despite showing some improvement over the prior quarter. The improvement was partly driven by a number of vessels in the Cool Pool that secured short-term charters in the $30k per day range.

Golar added that the underlying trend remains positive as new liquefaction projects continue to deliver.

Approximately 34 million tons of new LNG is expected to come online in 2017 representing 13 percent growth against 2016 global production while the shipping capacity is expected to grow by approximately 9 percent. This mismatch is expected to have a positive impact on shipping over the same time frame.

This mismatch is expected to have a positive impact on shipping over the same time frame, Golar LNG said.

Although the shipping business is expected to remain disappointing in the second quarter, the increased term charter activity and additional volumes arriving in the second half of 2017 represent grounds for cautious optimism, it said.

Cameroon FLNG project advances

Golar LNG informed the conversion of Golar Hilli, now named FLNG Hilli Episeyo is nearing completion.

All equipment has been installed and testing and pre-commissioning work is underway and will continue in Singapore until departure from the yard, which is expected to be in around 6 weeks. Seawater trials, storing-up and potentially LNG bunkering in Singapore will follow redelivery from the yard.

The mooring has now been completed and is en-route to Cameroon in advance of hook-up and initiation of commissioning and production at the end of September.

Ghana FSRU deal hits snag

Golar Tundra FSRU remains anchored off the coast of Ghana, Golar LNG said, as the charterer, West Africa Gas Limited, has made no further progress with the construction of supporting land-based infrastructure.

Golar has been granted an interim arbitration award of $23.3 million covering the period up to December 31, 2016, however, the company is due further $22 million for the period after December 31, 2016.

In addition, Golar Partners has now exercised its right, obligating Golar LNG to repurchase the FSRU Golar Tundra at a price equal to the original purchase price from May 2016.

Golar LNG has also signed deal with Golar Partners, granting the option to the latter to acquire up to 25 percent equity in the FLNG Hilli Episeyo.