On March 20, the operator of a floating liquefied natural gas (FLNG) facility Golar LNG Limited (“Golar”) announced that it has entered into finance lease agreements with a consortium of leading Chinese leasing companies for the refinancing of the existing FLNG Gimi debt facility. The sale leaseback facility will be approximately $1.2 billion.
Golar LNG did not disclose the name of the specific lessor, but according to an announcement by China Development Bank Financial Leasing (CDB Leasing) the lessor of the transaction is CDB Leasing. The transaction is subject to closing conditions including documentation and third-party approvals. The facility is expected to close within Q2 2025.
The contemplated sale and leaseback facility will have a tenor of 12 years and a 17-year amortization profile, with quarterly repayment installments throughout the lease period. Upon closing and repayment of the existing debt facility, Gimi MS Corporation is expected to generate net proceeds of approximately USD 530 million. This amount includes the release of existing interest rate swaps. Golar will benefit from 70% of these proceeds, equivalent to approximately USD 371 million.
FLNG Gimi is currently operating on BP’s Greater Tortue Ahmeyim (GTA) project offshore Mauritania and Senegal under a long-term contract until 2045.
The Tortue Ahmeyim project is one of the deepest offshore projects in Africa, with water depths of approximately 2,000 meters. The project will produce natural gas through an ultra-deepwater subsea system and an intermediate water depth Floating Production Storage and Offloading (FPSO) unit, which processes the gas to remove the heavier hydrocarbon components. The gas will then be transported to FLNG Gimi, which is located on the maritime border between Mauritania and Senegal.The FLNG unit is designed to provide an average of approximately 2.5 million tons of LNG per year.
It is understood that FLNG Gimi is converted from the LNG carrier “Gimi” and has a cargo hold capacity of 126,000 cubic meters. Keppel Shipyard, a subsidiary of Seatrium in Singapore, is responsible for the conversion, which cost US$1.3 billion and is scheduled to be completed and delivered in November 2023. After being converted into FLNG, FLNG Gimi has an annual production capacity of 2.7 million tons and a designed operating life of 20 years. During this period, it does not require a dry dock and can operate near the shore at a water depth of 30 meters.
Golar LNG recently sold the 2003-built steam turbine LNG carrier Golar Arctic for $24 million. The sale of the Golar Arctic, Golar’s last LNG carrier, means that the company will exit the LNG shipping business completely and focus on the operation of FLNG infrastructure in the future.