Summary:

Golar LNG builds, owns, and operates marine infrastructure for LNG liquefaction and regasification, with a market cap of $2.3 billion.

Golar’s assets include FLNG vessels currently working for Perenco, with the potential for new contracts that could double EBITDA.

The arrival of FLNG Gimi to the BP offshore field and its operation in late 2024 will increase Golar’s EBITDA by 50% and potentially result in a dividend hike.
Strong catalysts in the next six months.

The investment case is supported by dividends and a USD150 million buyback.

$GLNG Gimi update.

The Ship safely arrived in Port Lucia on Mauritius & is refueling.

She will then continue around the Cape of Good Hope and will send a “notice to connect” to BP once on the project is boundary.

Good read. Golar included.

Golar is starting to perform this year

https://fitinvestmentideas.com/2024/01/04/top-ideas-for-2024/

Golar today’s press release:

FLNG Gimi arrives at GTA field offshore Mauritania/Senegal

Golar LNG Limited (“Golar” or the “Company”) announces that FLNG Gimi arrived at the GTA field offshore Mauritania and Senegal on January 10, 2024. Golar has notified bp of FLNG Gimi’s arrival. Following completion of all preparatory activities FLNG Gimi will be maneuvered to her berth at the hub and for her subsequent connection to the feed gas pipeline. Golar and bp have agreed that FLNG Gimi will proceed to moor offshore Tenerife while awaiting completion of the necessary preparatory activities.

Golar CEO Karl-Fredrik Staubo commented: “Golar is pleased to see that the FLNG Gimi has arrived at the GTA field offshore Mauritania and Senegal, her home for the next 20 years. We are excited to integrate the Golar FLNG Facility with the GTA hub, and starting the next phase of our long-term relationship with bp and the GTA partners into LNG production.”

Rahman Rahmanov, bp’s vice president projects for Mauritania & Senegal commented: “This is a major step forward for overall delivery of the GTA1 project in Mauritania and Senegal. Safely achieving this milestone is a result of great teamwork.”

Fearnley today:

Golar LNG (BUY, USD 30)
• TP unchanged at USD 30/sh, Buy maintained
Having left the yard, Gimi is now ready for hook-up at the GTA field. Once the unit commences commercial operations it will add north of FSest. USD 50m in EBITDA (100% basis) per quarter. This, combined with a potential FID of the MKII Fuji FLNG (where long-lead items will be already paid for), we believe there is upside to the fixed quarterly dividends once Gimi is operational. Moreover, a Gimi refinancing (FSest. 5-6x EBITDA/70% LTV) is expected to release significant liquidity, adding to the already solid USD 753m cash position.

On the back of a lowered commodity forward curve, we trim our ’24-25 estimates somewhat. However, with FSest. core NAV at USD 24/sh, we believe there is solid backing on current pricing. Furthermore, we estimate growth to add a further USD 9/sh to this and hence continue to view the equity as attractive with triggers lined up (increased dividends and Gimi refi). We maintain our TP at USD 30/sh and reiterate our Buy recommendation (30/sh, 29.11.2023)

The golar idea is starting to gain traction.

Just a rummer of a new contract for Hili pushed the stock up 20%. Plenty of catalysts as in the thesis described. We are long. We bought based on the idea

Idea working nicely. Up 20%. Another 20% on the table. My price target is 30 USD by 3Q24

Golar´s Second FLNG close to production:

GLNG: Kosmos reports of ’significant progress at Tortue’
• Kosmos just reported Q1 numbers, with some comments on the GTA field.
Importantly, the project ‘continues to make good progress’ with first gas guided
for Q3 and first LNG expected in Q4. FLNG Gimi arrived on site in Q1 and has
been moored to the hub terminal, with the partnership ‘continuing to work with
the vessel operator to accelerate commissioning work’. Subsea work and the
FPSO are also progressing ‘in line with expectations’

Fearnley this mornig:

GLNG will report their 1Q figures tomorrow before the market opens.

We are aligned with CS and expect an EBITDA of USD 64m and a dividend of USD 25c/sh (4% annualised yield).

While Hilli's performance continues to be solid, we expect further comments regarding Gimi and its commissioning status – however, as Gimi is on a standby day rate, the timing of commissioning becomes less relevant from a CF perspective, albeit a commissioning period and eventual COD will open for a refinancing of Gimi (which we estimate will give a cash release of up to USD 350m net to GLNG).

Furthermore, GLNG is rumoured to have put Arctic up for sale, and a spin-off of Macaw is also expected to happen in the coming months.

Fearnley today:

We believe that GLNG will double their fixed dividend once Gimi reaches COD, and a potential refi of the unit will provide a cash release of up to USD 350m net to the company – which we believe GLNG partly will pay out as XO dividend.

GLNG reported 1Q EBITDA and EPS that was bang on expectations, further declaring another USD 0.25/sh dividend (4% annualised yield).

My calculation - after the dividend hike this year the dividend yield will reach 8%. That is before expected stock price apreciation,

Both Fearnley and Clarksons increased their price targets for GLNG today.

Fearnley:

It’s Cooking
What’s New: 1Q – TP raised to USD 35/sh, Buy re-iterated (30/sh, 08.03.2024)
• Hilli and MKII talks progressing, Gimi refinancing adds another trigger
• Substantial discount to core NAV of USD 31/sh (excl. growth)
• Adding further growth through a MKII contract, NAV rises to 40/sh

Clarkson summary:

Progress continues for Golar LNG (NASDAQ: GLNG), with the previously
announced Framework Agreement moving into detailed contractual
negotiations. Although hurdles remain, the likelihood of securing a new
FLNG contract is increasing. Additionally, the Gimi FLNG unit is ready at
the field and is currently receiving a standby day rate while awaiting
commissioning. The schedule for first gas in the third quarter has been
reiterated, and our estimates are unchanged. As always, Golar's valuation
is heavily reliant on future FLNG contracts and their terms. However, with
the recent developments and one or more FLNG contracts seemingly close
by, more weight should be attributed to new contracts. We currently assess
the SOTP at ~$20/share, while a recontracting on Hilli could add ~$15/share
and a MKII another ~$5/share. We maintain our Buy rating and increase our
target price to $40 per share (previously $30), factoring in a new contract
for Hilli and a MKII.

I like the idea. up almost 30%. Still early inning.

Clarksons last week updated their price target from USD30 to USD40

Momentum Building
Progress continues for Golar LNG (NASDAQ: GLNG), with the previously
announced Framework Agreement moving into detailed contractual
negotiations. Although hurdles remain, the likelihood of securing a new
FLNG contract is increasing. Additionally, the Gimi FLNG unit is ready at
the field and is currently receiving a standby day rate while awaiting
commissioning. The schedule for first gas in the third quarter has been
reiterated, and our estimates are unchanged. As always, Golar's valuation
is heavily reliant on future FLNG contracts and their terms. However, with
the recent developments and one or more FLNG contracts seemingly close
by, more weight should be attributed to new contracts. We currently assess
the SOTP at ~$20/share, while a recontracting on Hilli could add ~$15/share
and a MKII another ~$5/share. We maintain our Buy rating and increase our
target price to $40 per share (previously $30), factoring in a new contract
for Hilli and a MKII.

Pareto yesterday:

GLNG: Signs PDA in Nigeria for first gas in 2027 (FID expected in Q4)
• NNPC of Nigeria sent out a press release yesterday (11 June) announcing that
they have signed a Project Development Agreement (PDA) with Golar for the
deployment of an FLNG unit. A signing ceremony took place on Monday (10
June), and the share was up 4.5% on the day. This follows an MoU signed
between the two parties last year and details the use of a 400 – 500 mmscf/day
unit (2.8 – 3.5 mtpa) with first gas in 2027 – and FID targeted before end of
Q4’24. Golar highlighted some of these discussions in their Q1 report (‘up to
20-year FLNG deployment’) and can offer either Hilli or a Mark II conversion
• In a scenario with Gimi up and running, Hilli re-contracted at ‘Gimi-terms’ and
a Mark II unit operating in 2027, we see potential for a value closer to USD
40/sh – with the current share price discounting little value beyond the current
backlog plus a conservative residual on Hilli

Golar LNG (BUY, USD 35)
• Enters commercial reset agreement with bp for Gimi
Yesterday, GLNG announced that they have reached an agreement with bp to implement a commercial reset for FLNG Gimi. The reset will simplify contractual cash flows with a daily payment until the COD, with step-up mechanisms based on milestones up to COD which are secured by long stop dates. GLNG is also entitles to lump sum payments subject to certain milestones. These cash flows are expected to be deferred on the balance sheet and amortized over the 20-yr contract from COD. Further, the agreement settles previous disputes to payment mechanisms for Pre-COD contractual cash flows and re-aligns the parties towards reaching COD. Finally, GLNG have agreed with bp to start commissioning of Gimi with and LNG cargo prior to the availability of gas from the FPSO.

Overall, a positive update and another important step on the road for Gimi COD, which we estimate for late 4q24. Following COD, we see a refinancing of Gimi as the next step with some of the proceeds allocated to XO dividends, we believe.

Big buying opportunity after Monday sell off.

Recovery should be short

Very good quarter. Excellent presentation.

Expect price target re-rating

Link to the call:
https://edge.media-server.com/mmc/p/bnbns28b/

Arctic on GLNG Q2 Report: Positive report from GLNG; We like it

Adj. EBITDA below, but this is offset by BP compensation and MkII development
Adj. EBITDA of USD 58.7m (-10% vs. ARCe and Cons.)
Set to receive USD 220m from BP in pre-COD compensation (USD 2.12/sh un-discounted)
MkII contracting targeted for Q3/24 (which could add up to USD 11.6/sh on our figures)
Positive report from GLNG; We like it

GLNG presented at the Pareto conference last week

Some highlights:
GLNG is the worlds largest FLNG owner and operator
Major catalysts coming:
- decision to build its third FLNG vessel - expected in September 24
- GIMI should start their 20 year contract with BP tile 2045
- GIMI will triple existing FLNG capacity
- GIMI start should at least double EBITDA
- GIMI start should cause dividends to double
- GIMI start should allow GLNG to refinance GIMI related debt at lower rates + free capital for further projects

GLNG is both our short-term play on GIMI commissioning and dividend doubling as well as long term play on GLNG increasing its FLNG dominance

Presentation from Pareto conference:
https://ml-eu.globenewswire.com/Resource/Download/4916d9ed-87e2-4298-8db3-87492d9aaa21

Golar LNG investment summary case :

https://seekingalpha.com/article/4656183?gt=187308dc6bde4a07

Very positive news from GLNG today!

Final Investment Decision for MK II 3.5mtpa FLNG
18 Sep 2024

Golar LNG Limited (“Golar” or “the Company”) announces today that it has signed an Engineering, Procurement and Construction (“EPC”) agreement with CIMC Raffles (“CIMC”) for a MK II Floating LNG Production (“FLNG”) vessel with an annual liquefaction capacity of 3.5 million tons of LNG per annum (“MTPA”). Under the agreement with CIMC, Black & Veatch will provide its licensed PRICO® technology, perform detailed engineering and process design, specify and procure topside equipment and provide commissioning support for the FLNG topsides and liquefaction process, similar to Black & Veatch’s role in the construction of Golar’s existing assets, the FLNG Hilli and FLNG Gimi.

The Golar MK II design is an evolution of the MK I design of FLNG Hilli and FLNG Gimi and is also based on the conversion of an existing LNG carrier to an FLNG. The MK II design allows for a modularization of the construction process as well as further efficiency and operability advances based on learnings from previous experience on constructing and operating our existing FLNG assets. The project will utilize the Golar owned LNG carrier Fuji LNG with a storage capacity of 148,500 m3. The total EPC price is US$ 1.6 billion. The total budget for the MK II FLNG conversion is US$ 2.2 billion, inclusive of the conversion vessel, yard supervision, spares, crew, training, contingencies, initial bunker supply and voyage related costs to deliver the FLNG to its operational site, excluding financing costs. The MK II FLNG is expected to be delivered in Q4 2027. Out of the total conversion price, Golar has already spent US$ 0.3 billion to date inclusive of the conversion candidate, engineering and long lead items which are now 63% complete.

Yard selection for the MK II FLNG conversion was concluded two years ago. CIMC, Black & Veatch and Golar have subsequently spent approximately 350,000 man-hours optimizing the conversion process and de-risking project execution. As part of the EPC agreement Golar has also secured an option for a second MK II FLNG conversion slot at CIMC for delivery within 2028.

The 2027 delivery makes the MK II FLNG the earliest available floating liquefaction capacity globally. Based on potential charter terms in line with the most recent long term FLNG charter agreements, the MK II FLNG has earnings potential of approximately US$ 0.5 billion of adjusted annual EBITDA, before commodity exposure.

Golar CEO, Karl Fredrik Staubo commented: “We are pleased to announce the ordering of a MK II FLNG, a significant milestone for Golar and our partners CIMC and Black & Veatch. The ordering of the MK II FLNG strengthens Golar’s position as the market leading owner of FLNGs, increasing our controlled liquefaction capacity by about 70% to 8.6 MTPA. With a delivered price of around USD 600/ton of liquefaction capacity and an attractive Q4 2027 delivery, we believe today’s FLNG order is well positioned to offer prospective clients an attractive time-to-market to enable gas monetization, whilst driving value for Golar. We look forward to working with CIMC and Black & Veatch towards another successful FLNG delivery and hope to further expand the relationship with potential additional MK II FLNG units.”

Wang Jianzhong, CEO and President of CIMC Raffles, stated that “The signing of this new project further solidifies CIMC’s leadership position in offshore projects. It demonstrates CIMC’s ability to handle large, complex projects that meet the highest industry standards. CIMC will continue to focus on the independent development and manufacturing of high-end offshore equipment, committed to providing high-quality, innovative solutions for the global energy market.”

Black & Veatch’s Fuels & Natural Resources sector President Laszlo von Lazar said “We are pleased to be working with CIMC and Golar on the MK II FLNG, following our support for Golar’s two previous Floating LNG assets. The MK II represents our 6th floating LNG project to take a final investment decision utilizing our industry leading PRICO® liquefaction technology. The MK II demonstrates a clear commitment to reliable, consistent energy through Floating LNG, to help meet global demands during the energy transition.”

About Golar

Golar LNG is a NASDAQ listed maritime LNG infrastructure company. Through its 75-year history, the Company has pioneered maritime LNG infrastructure including the world's first Floating LNG liquefaction terminal (FLNG) and Floating Storage and Regasification Unit (FSRU) projects based on the conversion of existing LNG carriers. Today Golar is a focused FLNG company, and the only proven provider of FLNG as a service. Golar owns the world’s largest fleet of FLNG units by annual liquefaction capacity, with a market leading operational track record.