Höegh LNG secures refinancing for two FSRUs deployed in Germany

Norwegian shipowner Höegh LNG has signed a new loan facility agreement with a group of banks to refinance two floating storage and regasification units (FSRUs) employed on long-term contracts in Germany.

Archive. Höegh Esperanza. Courtesy of Niedersachsen Ports

Höegh LNG’s FSRUs Höegh Esperanza and Hoegh Gannet were chartered by the German Federal Ministry for Economic Affairs and Climate Action (BMWK) to serve the newbuild LNG terminals in Wilhemshaven and Brunsbüttel.

According to the shipowner, the new loan facility agreement is for a total amount of $685 million and has a tenor of 10 years. The loan amount will be applied to repay the existing loan facilities and general corporate use and is split into two tranches, one per vessel.

Subject to customary closing conditions being fulfilled, Höegh LNG expects to complete the refinancing of Höegh Esperanza in February. The refinancing of Hoegh Gannet is expected to be completed in March/April, depending on having successfully completed its commissioning for regas operations in Germany.

“We are very pleased with securing attractive, long-term financing for these two FSRUs with a strong group of international banks”, said Håvard Furu, Chief Financial Officer of Höegh LNG.

Related Article

To remind, the German government first announced its intention to charter FSRUs on 5 May 2022 as one of the first big steps to cut the country’s dependence on Russian gas.

At the time, Robert Habeck, Vice-Chancellor and Federal Minister for Economic Affairs and Climate Action, signed deals with Höegh LNG and Dynagas to charter two units from each company.

As of early 2023, three of Höegh LNG’s FSRUs are located in Germany. The Höegh Esperanza is in Wilhelmshaven, serving the country’s first LNG terminal.

The FSRU Neptune, which was chartered from French energy major TotalEnergies, is located in Lubmin and the Höegh Gannet will now be located in Brunsbüttel.

Collectively, they represent approximately 20 billion cubic metres (bcm) of annual regas capacity, potentially replacing a third of Russian pipeline gas imports