UK: Flex LNG Provides Update for Sponsors of Gulf LNG Project

Flex LNG Provides Update for Sponsors of Gulf LNG Project

FLEX LNG  would like to provide shareholders with an update regarding the status of ongoing discussions with the sponsors of the Gulf LNG Project and Samsung Heavy Industries (“SHI”).

As previously disclosed, FLEX LNG and SHI successfully completed Front End Engineering and Design (“FEED”) in December 2011 for the FLNG vessel for the Gulf LNG Project. The company has taken the technical preparations necessary to support a Final Investment Decision (“FID”) when the project sponsors, The PNG Government and other stakeholders are able to finalise project terms.

FLEX LNG continues to work closely in providing ongoing technical assistance to InterOil Corporation (“IOC”), Pacific LNG Operations (“PACLNG”) despite expiry of the Framework Agreement. FLEX LNG is currently unable to forecast the expected timing of a potential FID for the Gulf LNG Project. The dialogue between FLEX LNG and SHI regarding the restructuring of existing construction contracts for FLNG vessels has been progressing well although no final agreement has been reached yet. In light of the uncertainty surrounding timing of FID for the Gulf LNG Project, FLEX LNG and SHI have expanded the scope of the discussions to include negotiations for the alternative deployment of the capital invested by FLEX LNG. Commenting on the ongoing discussions, Chief Executive Officer of FLEX LNG

Management Ltd, Philip Fjeld stated: “We believe that over the coming months the company will have greater clarity with regard to the potential for an FID on the Gulf LNG Project as well as restructured arrangements with SHI that include an option for the alternative deployment of our shareholder capital”.

About FLEX LNG Ltd.

FLEX LNG was incorporated in 2006 and is listed in Norway under the ticker code FLNG. The Company was incorporated with the objective of commercialising some of the world’s first floating liquefaction units (LNG Producers). TheCompany holds contracts with Samsung Heavy Industries for the LNG Producer Hull and for the Engineering, Procurement, Construction, Integration and Commissioning of the liquefaction unit.

In April 2011 the Company executed agreements with InterOil, Pacific LNG, LNGL and Samsung Heavy Industries for a FLNG project that would liquefy natural gas from the onshore Elk and Antelope gas fields in the Gulf Province in PNG. Commencement of operations is targeted for 2015. The Company is also working on a number of other promising projects.

Shipbuilding Tribune Staff, January 23, 2012; Image: FLEX LNG