Golar LNG enters into an agreement to supply a FLNG unit to BP for phase 1 of the Greater Tortue / Ahmeyim Project, West Africa
February 26 2019 - 9:01AM
Golar LNG Limited ("Golar" or "the
Company") (NASDAQ: GLNG) announces today that Gimi MS Corporation
("Gimi MS"), a newly incorporated subsidiary of the Company, has
entered into a 20-year Lease and Operate Agreement ("LOA") with BP
for the charter of an FLNG unit, Gimi, to
service the Greater Tortue Ahmeyim project.
Expected to commence production in
2022, the FLNG Unit Gimi will liquefy gas as
part of the first phase of the Greater Tortue Ahmeyim project and
be located at an innovative nearshore hub located on the Mauritania
and Senegal maritime border. FLNG Gimi is
designed to produce an average of approximately 2.5 million tonnes
of LNG per annum, using the Black & Veatch "Prico" liquefaction
process, with the total gas resources in the field estimated to be
around 15 trillion cubic feet.
Concurrent with its entry into the
LOA, Gimi MS has entered into a Subscription Agreement (subject to
closing conditions) with First FLNG Holdings Pte. Ltd., an indirect
wholly-owned subsidiary of Keppel Capital, in respect of their
participation in a 30% share of FLNG Gimi. Gimi MS will construct, own and operate
FLNG Gimi and First FLNG Holdings Pte. Ltd.
will subscribe for 30% of the total issued ordinary share capital
of Gimi MS for a subscription price equivalent to 30% of the
project cost. LNG carrier Gimi has been
relocated from layup to Keppel Shipyard in Singapore where
conversion works are expected to commence soon.
Construction of FLNG Gimi is expected to cost approximately $1.3 billion,
excluding financing costs. Once accepted under the contract, annual
earnings before interest, tax, depreciation and amortization of
approximately $215 million with potential upside for over
performance are expected. Golar is also in the final stages
of receiving an underwritten credit commitment for a $700 million
long-term financing facility from a syndicate of international
banks that will be available during construction. Golar's
plan is that together with other financing facilities, by the end
of the 4-year construction period the anticipated maximum total
equity contribution from the Company in respect of its 70% stake
will be approximately $300 million.
Commenting on the LOA, Golar CEO
Iain Ross said, "This landmark 20-year agreement with BP, which is
Golar's second FLNG tolling agreement, is the culmination of a lot
of hard work and commitment from the project and commercial teams
that commenced late 2017. The potential of Golar's floating
LNG solution was reinforced by FLNG Hilli
Episeyo's proof of concept, Heads of Terms were agreed with BP
and its partners in April 2018 and work has been ongoing via the
previously reported Limited Notice to Proceed. Golar is
delighted to have the opportunity to demonstrate the safe and
reliable operation, quality and value of its FLNG offering to such
a world class energy company as BP and looks forward to safely
delivering and building on this long-term relationship over the
decades ahead".
FORWARD LOOKING STATEMENTS
This press release contains
forward-looking statements (as defined in Section 21E of the
Securities Exchange Act of 1934, as amended) which reflects
management's current expectations, estimates and projections about
its operations. All statements, other than statements of historical
facts, that address activities and events that will, should, could
or may occur in the future are forward-looking statements. Words
such as "may," "could," "should," "would," "expect," "plan,"
"anticipate," "intend," "forecast," "believe," "estimate,"
"predict," "propose," "potential," "continue," or the negative of
these terms and similar expressions are intended to identify such
forward-looking statements. These statements are not guarantees of
future performance and are subject to certain risks, uncertainties
and other factors, some of which are beyond our control and are
difficult to predict. Therefore, actual outcomes and results may
differ materially from what is expressed or forecasted in such
forward-looking statements. You should not place undue reliance on
these forward-looking statements, which speak only as of the date
of this press release. Unless legally required, Golar undertakes no
obligation to update publicly any forward-looking statements
whether as a result of new information, future events or
otherwise.
Among the important factors that
could cause actual results to differ materially from those in the
forward-looking statements are:
-
our inability and that of our
counterparty to meet our respective obligations under the Lease and
Operate agreement entered into in connection with the BP Greater
Tortue / Ahmeyim Project;
-
changes in our relationships with our
counterparties, including our major chartering parties;
-
failures of shipyards to comply with
delivery schedules or performance specifications on a timely basis
or at all;
-
changes in our ability to obtain
additional financing on acceptable terms or at all;
-
increases in costs, including, among
other things, wages, insurance, provisions, repairs and maintenance
as well as the cost of constructing the FLNG
Gimi;
-
changes in general domestic and
international political conditions, particularly where FLNG Gimi will operate;
-
a decline or continuing weakness in the
global financial markets; and
-
other factors listed from time to time
in registration statements, reports or other materials that we have
filed with or furnished to the Securities and Exchange Commission,
or the Commission, including our most recent annual report on Form
20-F.
As a result, you are cautioned not
to rely on any forward-looking statements. Actual results may
differ materially from those expressed or implied by such
forward-looking statements. The Company undertakes no obligation to
publicly update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise unless
required by law.
Hamilton, Bermuda
February 26, 2019
Enquiries:
Golar Management Limited: + 44 207 063 7900
Stuart Buchanan
This
announcement is distributed by West Corporation on behalf of West
Corporation clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: Golar LNG via Globenewswire
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