Golar Confirms Cameroon 'Acceptance'
Golar LNG confirmed June 4 that its FLNG vessel Hilli Episeyo has been accepted under its liquefaction tolling agreement with French operator Perenco and Cameroon state-owned SNH and "is now in full commercial operation."
Commissioning tests included the requirement to produce a set quantity of LNG in a period of 16 days of continuous production from minimum two trains at a level of 7500 m3 per day on average.
Golar said the commercial tolling rate commencing will immediately add approximately $164mn in pre-tax earnings (Ebitda) of base tolling income per year, plus an additional $45mn operating cash flow per year based on the oil price linked element of the contract (assuming that Brent remains at an average of $75/bbl).
As a consequence of the commencement of commercial operations Golar is now able to draw on the $960mn lease financing facility that will replace the existing loan. It is estimated that a minimum of approximately $140mn in additional free cash will be released from this facility, after meeting maximum remaining capital costs and net of minority interests, the shipowner said.
The dropdown of 50% of the base tolling income to Golar LNG Partners, a sister company, is expected to be concluded shortly. The additional added contribution of approximately $82mn in effective Ebitda effective Ebitda backlog of $650mn, given the eight year contract term, will significantly strengthening the latter's financial position and supporting solid distribution going forward, said Golar.
FLNG Hilli Episeyo is the world's first FLNG vessel developed as a conversion project from an LNG carrier, "adding value through its accelerated time to first LNG production and cost-competitive pricing," said Golar; the project cost is expected to be some $70mn under budget.