Golar LNG Limited Surges Ahead: Q1 2025 Results Showcase Unparalleled FLNG Growth Potential
At its Q1 2025 Earnings Results Presentation, Golar LNG Limited's CEO, Karl Fredrik Staubo, and CFO, Eduardo Maranhao, presented a compelling narrative of the company's remarkable progress. With a market cap of $4 billion and total net debt shy of $800 million, Golar LNG has solidified its position as a leading player in the FLNG (Floating Liquefied Natural Gas) industry.
The key event of the quarter was the occurrence of 220 charters for their FLNG Hilli, following the end of their current charter in Cameroon in July next year. Additionally, they entered into definitive agreements for a 20-year charter for their Mark II FLNG and construction. Notably, they have fully exited LNG shipping with the sale of the Golar Arctic and equity stake in Avenir LNG, further streamlining their focus on FLNG.
With a strong cash flow visibility, solid balance sheet, and market-leading position as the only proven provider of FLNG as a service, the company is poised for continued attractive growth. They have three FLNG designs available for expansion, with Hilli continuing to set the standard with 100% operational uptime during Q1.
Hilli has delivered an impressive 132 cargoes since contract commencement in 2018, totaling over 9.2 million tonnes of LNG produced. Moreover, all CPs (Contractual Provisions) for her 20-year redeployment in Argentina were concluded on May 2, securing $5.7 billion of EBITDA backlog before commodity outside.
Golar's second FLNG, Gimi, is nearing completion and set to start a 20-year charter with BP offshore Senegal and Mauritania. With the commercial reset announced in August last year, they have invoiced $196 million in pre-COD payments from GTA upstream partners, which will be amortized over the contract duration.
The company's third FLNG conversion project, Mark II, is well into construction at a shipyard in China. The liquefaction plant for the 3.5 million tonnes per annum vessel is being built on a new midship section and is on schedule to deliver by year-end 2027. Furthermore, they have entered into definitive agreements for a 20-year charter for Mark II to operate alongside Hilli in Argentina.
The CapEx to EBITDA for the Mark II is estimated to be around 5.5x before commodity upside, highlighting the potential for significant returns on investment. The simultaneous completion of CPs for both FLNG projects and recent Hilli process approvals will undoubtedly benefit future operations.
Golar LNG Limited's Q1 2025 results not only showcase the company's remarkable progress but also underscore its commitment to becoming a leading player in the burgeoning FLNG industry. With an unparalleled market position, solid balance sheet, and unrelenting focus on growth, Golar LNG is poised for continued success.
