Results of companies

Golar LNG 4Q20 results

The last 3 months have been quite busy for Golar LNG. They did an AK (12MM shares to raise $100MM), executed a new $100 million credit facility and sold and LNG carrier (Golar Viking) which released $51.7MM.

Golar used that money to repay the $150 MM bilateral facility and the $30 MM margin loan. 

Apart from that, Golar sold Hygo and its shares of Golar Partners. Golar got 18.6MM shares of New Fortress Energy plus $130.8MM in cash.

Golar cash position at quarter end was $254 MM, of which $128 MM in unrestricted cash and $126 MM in restricted cash.

After the Hygo and Golar Partners transactions, Golar structure is the following:

Golar LNG structure
Source: Golar LNG

Golar LNG 4Q20 Results

No much to comment on here, results were a bit better than expected: $118MM revenue, $78MM EBITDA and $0.09 EPS.

The shipping segment achieved a TCE of $48k and Golar Hilli was 100% operative + $8MM revenue as a result of overproduction in the last 2 years (overproduction cap has been removed so Golar Hilli can obtain revenue if it produces more than the amount it is contracted now).

I am going to focus on the main things around the future of the company in each one of its segments, those are my notes from the conference call


There is a $123MM backlog over the next 12 months representing a TCE of around $50k/day (around breakeven, so shipping is not costing money, good). The total backlog is $193MM.

Specifically, in 1Q21, TCE is forecasted to be around $60k and utilisation around 90% (so much better than the 4Q20)

They had a question about selling the shipping segment (as they had said several times in the past). Maybe it is only my feeling, but I think that they are not thinking about that now as an interesting 2022-2023 cycle is approaching.


Golar said that it is in negotiations with Perenco and SNH to increase production in trains 3 /4 (nothing new here). Apparently, it can happen at the beginning of 2022. The testing drilling campaign is expected to start in the coming months (after that they will decide to increase Hilli production if the results of the drilling campaign are good enough).

Troim has said that they have better alternatives than to continue in Cameroon. So they say if they do not get a good deal from Perenco, they will be leaving by July 26. Apparently, it would take around 2 years to adjust the vessel to the new location and to be operative again, so the new deal should be quite interesting. (Maybe it is a bluff to put some pressure on Perenco).

They continue developing Mark III and talking with potential customers for new projects. I understand (maybe I am wrong) that they are thinking to do an IPO with this segment or look for a new partner to develop the pipeline of projects…

NFE shares 

Golar got 18.6MM shares of NFE, Golar has a 90-day lockup from the closing of the transaction. Golar is planning to sell a part of the shares by that time. They have several alternatives either margin lend against their NFE stake on margin loans (60% LTV), refinancing the CB involving the NFE shares, sell some part of the stake and give to their shareholders or even give them the NFE shares directly.

Golar LNG tends to be partners with and NFE long term. They will either directly or indirectly be long-term shareholders in NFE. Troim said they are constantly speaking with NFE, not only because of the transaction but also to do business together

Troim asked the shareholders for forgiveness for the bad performance last year.

Golar also talked about the $50MM buyback programme to start after selling NFE shares.

Golar 4Q20 Conclusion

Honestly, I believe that Golar is in its best position for the last 2 years. Maybe at the beginning, the sale of Hygo wasn’t so appealing as other alternatives, but Golar has solved its short-term liquidity issues and can be focused on the FLNG segment. The FLNG Golar Gimi will be ready in 2H23 and it will give Golar $215MM EBITDA per year. The only thing that makes me think a bit is the idea they have over the shipping segment, it was clear one year ago that they wanted to sell it. Now, I don’t know if they are even thinking of increasing the fleet. I hope they keep focusing on developing the FLNG segment.


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