Golar LNG Back in Black, Despite Hit on OneLNG

Golar LNG, the Bermuda-registered shipowner, was back in profit in its second quarter results. But it had little to say about the languishing Fortuna FLNG project offshore Equatorial Guinea.

Net 2Q profit was $36.3mn, compared with a net loss in 2Q2017 of $21mn.  But it incurred a steep $10mn of FLNG costs relating to dissolution of its ‘OneLNG’ joint venture with Schlumberger. OneLNG was set up to participate in Fortuna FLNG, for which a final investment decision is long overdue. Golar though remains involved and operator Ophir is hoping the project will not be scrapped by the government.

Golar LNG's overall project development expenses meanwhile increased from $3.3mn in 1Q2018 to $7.9mn – chiefly through FLNG project development expenses of $6.8mn, these predominantly being front end engineering and design (Feed) and other fees relating to the BP-Kosmos Tortue project. Golar though added that it "continues to pursue other FLNG projects capable of delivering LNG at around the same time and is actively pursuing several investment opportunities alone and with partners, including the economically attractive Fortuna project."

This May, FLNG Hilli Episeyo exported the first LNG from offshore Cameroon and was certified as accepted by project operator Perenco and its state partner SNH on June 2. The FLNG vessel has achieved 100% commercial uptime since June 2, with offload of its sixth cargo expected shortly.

Golar said its average revenue per ship (time charter equivalent) was of $19,600/d in 2Q2018, which it expects to “at least double” in 3Q; this compares with $36,000/d in 1Q and $14,600/d in 2Q 2017.

Dynagas left the so-called ‘Cool Pool’, a joint marketing arrangement for unchartered LNG carriers, in June 2018 – a sign of a healthier shipping market – but Golar and GasLog will keep running it.

In Brazil, the Sergipe I LNG/power project was “66%-complete” at end-July and remains on schedule to start up January 1 2020, with over 2000 workers on site which is operating 24-7, said Golar, adding that its earmarked FSRU Nanook will, when it starts operations in 2019, “represent the only entry point for LNG into Brazil outside Petrobras.” Golar Power, which is developing the 1.5-GW gas-fired power project, is a 50-50 joint venture of Golar LNG and US fund Stonepeak. 

(Banner photo: the Galicia Spirit which in mid-May loaded the first LNG cargo from the Cameroon FLNG vessel; credit for photo: Union Fenosa Gas)