Tor Olav Troim-led Golar LNG is moving ahead with a new $300m LNG carrier-to-floating LNG (FLNG) production unit which could be ready for delivery in 2025.
The company said in its third quarter results statement that it has ordered long-lead items for one of its planned Mark II 3.5 million tonnes per annum FLNG units.
It detailed that these primarily comprise compressors, gas turbines, cold boxes and heat recovery steam generators.
“We believe that securing attractive delivery of our next FLNG unit will increase Golar’s ability to drive value with prospective FLNG clients,” the company said.
Golar said it is seeing “strong customer development” for FLNG projects.
The company revealed that it is working with an upstream company for a potential integrated FLNG project and undertaking paid development agreements with a supermajor and an independent exploration & production company for new FLNG opportunities.
“Under the development agreements both parties commit to deliver a defined scope of work within set deadlines to progress potential new FLNG opportunities and agree on key steps to reach final investment decisions,” Golar said.
Golar said its conversion job for the FLNG Gimi was 90% technically complete on 15 November and pre-commissioning of equipment has started.
The company said the floater is on track for sail away in the first half of 2023.
The unit’s 20-year contract with BP is due to start in the fourth quarter of 2023. Golar said the floater is expected to unlock around $3bn of earnings backlog to the company.
During the quarter Golar managed to cash in red hot charter rates for LNG carriers, despite having disposed of the bulk of its fleet to Cool Company at the start of 2022.
The company said it netted $3.1m in the third quarter by sub-chartering its 170,000-cbm floating storage and regasification unit Tundra (built 2015, ex Golar Tundra) back from its buyer Snam until November.
Golar signed a services agreement to assist Snam with drydocking, site commissioning and hook-up of the FSRU with $5.1m from this deal recognised in the third quarter.
The company also continued to trade the 140,648-cbm Golar Arctic (built 2003) which will be converted into an FSRU for Snam.
During the quarter Golar locked in a 12-month charter on the vessel which is expected to generate around $16m annual adjusted EBITDA.
Golar turned around its third quarter figures for 2022 reporting net income of $141.1m reversing a net loss of $91m in the same period of 2021.
Total operating revenue crept up to $68.6m from $67.2m a year earlier.
In November Golar sold 8m shares in Cool Co and 6.3m in New Fortress Energy raising $430m.
Golar said production for its FLNG unit Hilli off Cameroon is not expected to exceed 1.4 million tonnes of LNG in 2022 due to an extended maintenance window during the quarter and upstream infrastructure limits on available feedgas for over production in the fourth quarter.
The company said this has reversed $14.4m in fees accrued for overproduction in the first two quarters of this year with an estimated $0.9m of revenue reduction due to demurrage delays also incurred in the third quarter.
In August and September Golar entered into three swap transactions linked to Hilli’s TTF-linked production collectively securing, subject to vessel availability, around $250m of incremental earnings for the company.
