Norway’s Hoegh Evi is upbeat on the demand for floating storage and regasification units and is noting strong interest from certain geographical areas.
“Business activity for potential new FSRU projects remain high across all regions, and in particular there has been increased activity in the Americas region lately,” the company, formerly Hoegh LNG, said in a third-quarter results statement.
It said that while global LNG production is projected to increase by 45% by 2029 and newbuildings are being added to LNG fleet, investments in receiving capacity are “lagging”.
“If the world is going to benefit from the substantial increase in production capacity, then receiving capacity must follow. Hoegh Evi is therefore very optimistic on the outlook for demand of FSRUs,” it said.
Hoegh Evi currently operates a fleet of 10 FSRUs and three LNG carriers, which are all operating under long-term contracts, except the 160,000-cbm Hoegh Gandria (built 2013), which the company bought secondhand as a possible conversion candidate.
The company said the Hoegh Gandria’s short-term charter is due to end in the fourth quarter and it intends to employ the vessel on another charter.
Hoegh Evi will lose one of its FSRU fleet next month when the 170,000-cbm Independence (built 2014) shifts to KN Energies in Lithuania after the state energy company exercised its purchase option on the vessel.
The regas specialist detailed that the global FSRU fleet numbers 47 units, excluding four barges, with just one of these currently available prompt.
There are three FSRU newbuildings on order, of which only one is uncommitted, and four LNG carriers under conversion to FSRUs for dedicated project business.
Aside from its FSRU business, Hoegh Evi has been building out its clean energy activities.
The company has just signed up with Port La Nouvelle in France to develop a floating terminal for hydrogen imports.
It is also working with Germany’s Deutsche ReGas on what is expected to be the world’s first floating green ammonia cracker that will produce about 30,000 tonnes per annum of hydrogen from 2026.
Hoegh Evi is also participating in a pilot ammonia-to-hydrogen cracker project in Norway due to start tests this year that run through until mid-2025 and is working with Aker BP on a carbon transport and storage proposal for industrial emitter in northern Europe.
Hoegh Evi’s third-quarter profit slipped slightly to $26.3m from $27.5m in the same period a year ago.
Total income was lower at $126.4m, down from $131.0m in the third quarter of 2023.
The company said that in October it had closed a new seven-year loan facility of $625m.
It said the $375m term element has been used to repay the outstanding amounts under the existing debt facilities for the 170,000-cbm Hoegh Giant (built 2017), Hoegh Grace (built 2016) and Hoegh Gallant (built 2014).
Hoegh Evi said its fleet has delivered “stable operating performance” in the third quarter with “close to 100% availability”.
The company has committed to reducing its total CO2 emissions by 50% and having the first net-zero carbon FSRU in operation by 2030.
