Golar LNG to Reactivate Gandria from Layup
- Business & Finance
As the shipping market recovery gathers momentum, Golar LNG has decided to reactivate its LNG carrier Gandria from layup.
As informed, the company is in the process of moving the 1977-built vessel from layup for positioning to Singapore’s Keppel Shipyard.
This was unveiled in the company’s 4Q 2017 results in which Golar reported a net income of USD 3.8 million, against a net loss of USD 43.9 million seen in 3Q 2017.
What is more, operating income and EBITDA stood at USD 2.8 million and USD 19.4 million, respectively, compared to 3Q 2017 losses of USD 22.9 million and USD 5.5 million.
The LNG shipping market continued to tighten as a result of 2017 demand increasing 11% contrasting with shipping supply increasing by only 5%. A reduction in prompt available vessels also resulted in improving rates and utilization for steam turbine vessels.
In response, the company reactivated the ST carrier Golar Viking, which entered the spot market during February 2018.
In January 2018, Golar Partners agreed a 15-year charter for an FLNG in the Atlantic Basin with an undisclosed energy company. Golar can nominate either the Golar Spirit or the Golar Freeze to service the contract.
Furthermore, in October 2017, Golar Partners closed a 5.52 million USD 25 per unit 8.75% Series A Preferred Unit offering, raising a total of USD 133 million. This and another facility established in September which has generated USD 17.8 million so far will fund part of the partnership’s potential acquisition of the remaining 50% of Hilli Episeyo’s contracted capacity.
Hilli Episeyo is the world’s first converted FLNG vessel which departed Keppel Shipyard in Singapore in October and arrived in Cameroon in late November 2017. The ship will operate offshore Kribi, Cameroon for Société Nationale des Hydrocarbures and Perenco Cameroon SA, and will be the first FLNGV project in Africa. The first LNG production is expected to commence in the coming days, according to the company.
The company said that Hilli proof of concept is opening up a wider range of financing options for Fortuna project such as the initiation of Gandria yard works. In addition, further FLNG opportunities are being developed.
Golar added that the construction of the Sergipe power project continues to plan. A full financing package for the project is likely to close within 4Q 2018. The FSRU Golar Nanook is due for delivery in September 2018.
“With a strong underlying LNG Carrier market, the imminent acceptance of Hilli Episeyo, solid progress on the Sergipe power project and the potential for several FLNG/FSRU projects to reach FID, Golar expects significant earnings growth over the coming years,” Golar said in the outlook.