Regasification specialist Hoegh LNG Partners is inching forward on the refinancing of one of its floating storage and regasification units which is currently the subject of arbitration proceedings.
Speaking on a results call, interim chief executive and chief financial officer Havard Furu said commitment letters and a term sheet have been received from a group of lenders for an approved refinancing of the commercial tranche of the debt facility on the 170,000-cbm PGN FSRU Lampung (built 2014).
If Hoegh refinances the unit by 29 December, the maturity date will be pushed back further until 29 March 2022. But if it is unable to complete this by the given date it can be called by the lenders.
Furu said the partnership expects to complete the refinancing but he said the terms are likely to be less favourable than those originally agreed and the existing facility for the FSRU.
The FSRU's charterer PGN LNG raised issues about the operation of the unit this year and said it planned to terminate the charter. Hoegh served a counterclaim against the Indonesian company.
Furu would not be drawn on the ongoing dispute over PGN FSRU Lampung and said it is still "early days" for the arbitration process.
Hoegh LNG Partners is also in the process of refinancing its two older FSRUs.
Furu said the new agreement for the Neptune (built 2009) has been signed and one for the Cape Ann (built 2010) is expected to be agreed in December. Both regas units are on long-term charters to Total.
On its FSRU Hoegh Gallant (built 2014), which was recently fixed on a 10-year deal to New Fortress Energy, the company said its existing charter for the vessel with a Hoegh LNG Holdings subsidiary is being suspended.
The Hoegh LNG Holdings arm will compensate the partnership by $3,000 per day "with the addition of a modest increase" for the difference between the charter rate earned from New Fortress and the charter rate earned under the existing charter until its expiry on 31 July 2025.
The partnership's third-quarter net income slid back to $17.4m from $19.5m in the same period of 2020.
Total revenue slipped to $35.6m for the quarter, from $35.9m in the corresponding three months of last year.
