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Highlights
- Golar LNG acquires minority interests in FLNG Hilli for $90.2M
- FLNG Hilli contracted in Cameroon until July 2026
- Ownership increase adds ~$0.5bn to Adjusted EBITDA backlog
The liquefied natural gas (LNG) sector continues to evolve with significant transactions shaping its landscape. Golar LNG has recently made strategic moves within this sector by acquiring all minority ownership interests in the FLNG Hilli vessel.
Acquisition Details
Golar LNG (NASDAQ:GLNG) has completed the acquisition of minority stakes in the FLNG Hilli from Seatrium and Black & Veatch. The total investment amounts to $90.2 million, which includes $59.9 million in equity and a $30.3 million share of the debt facility. This acquisition encompasses 5.45% common units, along with 10.9% Series A and Series B shares, collectively representing approximately 8% of the vessel's full FLNG capacity.
Operational Contracts
The FLNG Hilli is currently under contract with Perenco, operating in Cameroon until July 2026. Following the completion of this contract, the vessel is scheduled to relocate to Argentina, where it will enter into a 20-year agreement with Southern Energy. This long-term contract ensures continued operational stability and utilization of the FLNG Hilli in the region.
Performance and Capacity
Since its deployment in 2018, the FLNG Hilli has successfully delivered 124 LNG cargoes and offloaded over 8.5 million tons of LNG. These figures highlight the vessel's operational efficiency and its role in meeting the LNG demands of its contractual partners. The vessel's performance underscores its significance within Golar LNG's fleet and the broader LNG market.
Financial Impact
The acquisition of the minority interests in FLNG Hilli is projected to contribute approximately $0.5 billion to Golar LNG's Adjusted EBITDA backlog. This financial impact is set to take effect from January 1, 2025, enhancing the company's financial standing and capacity to manage its operations within the LNG sector. The increased backlog reflects the vessel's ongoing contracts and the anticipated revenue streams from future engagements.
Strategic Implications
By consolidating its ownership of the FLNG Hilli, Golar LNG reinforces its position in the LNG market. The strategic acquisition aligns with the company's objectives to expand its operational capacity and secure long-term contracts that ensure sustained performance. This move demonstrates Golar LNG's commitment to maintaining a robust and competitive presence in the global LNG industry.
Future Prospects
The FLNG Hilli's relocation to Argentina and the subsequent long-term contract with Southern Energy indicate a stable operational future for the vessel. The extended contract duration provides a predictable operational timeline, which is beneficial for logistical planning and resource allocation. This stability is a valuable asset for Golar LNG as it navigates the dynamic landscape of the LNG sector.The acquisition of minority interests in the FLNG Hilli by Golar LNG marks a significant development within the LNG sector. With established contracts and a strong
operational record, the FLNG Hilli continues to play a vital role in the delivery and offloading of LNG, contributing to the company's overall financial and operational objectives.
