Golar LNG Limited Enhances Its Stake in FLNG Hilli
Golar LNG Limited, known simply as Golar, has successfully completed the acquisition of minority ownership interests in the Floating Liquefied Natural Gas (FLNG) unit, Hilli. With this strategic move, Golar has consolidated its commitment to expanding its operations in the dynamic natural gas sector.
Details of the Acquisition
This acquisition includes interests previously held by Seatrium and Black & Veatch. By bringing these interests under its control, Golar has effectively absorbed a total of 5.45% common units along with 10.9% of both Series A and Series B shares. This move is significant, amounting to approximately 8% of the full capacity of the FLNG Hilli.
The Financial Aspects
The transaction’s total value is pegged at $90.2 million, comprising $59.9 million allocated in equity and an additional $30.3 million representing a pro-rata share in the existing debt facility associated with FLNG Hilli. Notably, Golar will realize the full benefits of this increased stake starting January 1, 2025.
Current Operations of FLNG Hilli
Presently operational and contracted with Perenco in Cameroon until mid-2026, FLNG Hilli is slated for a significant transition. Following its contract expiration, the unit is expected to relocate to Argentina, where it will enter into a 20-year agreement with Southern Energy, which represents a coalition of prominent natural gas providers in the region. This prospective contract is still contingent on certain conditions such as obtaining an export license and passing environmental assessments.
Achievements of FLNG Hilli
Since entering operations in 2018, FLNG Hilli has showcased remarkable performance, maintaining industry-leading operational uptime. To date, it has facilitated the transportation of 124 LNG cargoes, translating to over 8.5 million tons of natural gas delivered.
Settlements and Future Collaborations
Alongside the ownership transfer, Golar and Seatrium have settled various outstanding issues. This includes a $7 million payment to Seatrium concerning a utilization bonus related to Hilli's Train 3, and resolution of historical matters involving the previously owned Golar Gandria LNG carrier. Importantly, following these agreements, all contractual connections between Golar and Seatrium concerning existing assets have been resolved.
CEO’s Statement and Outlook
Golar’s CEO, Karl-Fredrik Staubo, expressed enthusiasm about this full ownership acquisition, stating, “Taking full ownership of FLNG Hilli positions Golar for immediate cash flow increase and contributes around $0.5 billion to our Adjusted EBITDA backlog.” He emphasized the company’s appreciation for its long-standing partnerships with Seatrium and Black & Veatch and looks forward to continued cooperation as they pursue future FLNG ventures.
A Clear Path Ahead
This acquisition underscores Golar’s commitment to enhancing its operational reach and financial performance in the rapidly evolving LNG market. Engaging with two reputable players in the industry further solidifies Golar's position as a key player in the expanding natural gas landscape.
Frequently Asked Questions
What does the acquisition of the FLNG Hilli entail?
The acquisition allows Golar to gain complete ownership of FLNG Hilli, absorbing minority interests previously held by Seatrium and Black & Veatch.
How much did Golar pay for the Hilli acquisition?
The total payment for the acquisition was $90.2 million, inclusive of equity and pro-rata share in the existing debt service.
What future plans does Golar have for FLNG Hilli?
Golar plans to relocate FLNG Hilli to Argentina after the current contract with Perenco ends in mid-2026.
What is Golar’s expected financial benefit from this deal?
Golar expects an increase in cash flow and approximately $0.5 billion added to its Adjusted EBITDA backlog due to this acquisition.
Who can be contacted for investor inquiries?
Investor inquiries can be directed to Golar’s CEO Karl-Fredrik Staubo and CFO Eduardo Maranhão at the contact number provided in their announcements.
