GOLAR LNG LIMITED SEPTEMBER, 2021
Golar LNG
Existing asset base driving earnings growth
© Golar LNG Limited
Forward Looking Statements
This press release contains forward-looking statements (as defined in Section 21E of the Securities Exchange Act of 1934, as amended) which reflects management's current expectations, estimates and projections about its operations. All statements, other than statements of historical facts, that address activities and events that will, should, could or may occur in the future are forward-looking statements. Words such as "may," "could," "should," "would," "will," "expect," "plan," "anticipate," "intend," "forecast," "believe," "estimate," "predict," "propose," "potential," "continue," or the negative of these terms and similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and other factors, some of which are beyond our control and are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. You should not place undue reliance on these forward- looking statements, which speak only as of the date of this press release. Unless legally required, Golar undertakes no obligation to update publicly any forward-looking statements whether as a result of new information, future events or otherwise.
Among the important factors that could cause actual results to differ materially from those in
the forward-looking statements are: our inability and that of our counterparty to meet our respective obligations under the Lease and Operate Agreement entered into in connection with the BP Greater Tortue / Ahmeyim Project ("Gimi GTA Project"); continuing uncertainty resulting from potential future claims from our counterparties of purported force majeure under contractual arrangements, including but not limited to our construction projects (including the Gimi GTA Project) and other contracts to which we are a party; claims made or losses incurred in connection with our continuing obligations with regard to Hygo Energy Transition Ltd ("Hygo") and Golar LNG Partners LP ("Golar Partners"); the ability of Hygo, Golar Partners and New Fortress Energy, Inc. ("NFE") to meet their respective obligations to us, including indemnification obligations; our ability to formalize a settlement agreement with authorities regarding tax benefits previously obtained under certain of our leasing agreements; changes in our ability to retrofit vessels as floating storage and regasification units ("FSRUs") or floating liquefaction natural gas vessels ("FLNGs") and in our ability to obtain financing for such conversions on acceptable terms or at all; changes in our ability to obtain additional financing on acceptable terms or at all; the length and severity of outbreaks of pandemics, including the recent worldwide outbreak of the novel coronavirus ("COVID-19") and its impact on demand for liquefied natural gas ("LNG") and natural gas, the timing of
completion of our conversion projects, the operations of our charterers, our global operations and our business in general; failure of our contract counterparties to comply with their agreements with us or other key project stakeholders; changes in LNG carrier, FSRU, or FLNG including charter rates, vessel values or technological advancements; our vessel values and any future impairment charges we may incur; our ability to close potential future sales of additional equity interests in our vessels, including the Hilli Episeyo("Hilli") and FLNG Gimi on a timely basis or at all; our ability to contract the full utilization of the Hilli or other vessels; changes in the supply of or demand for LNG carriers, FSRUs or FLNGs; a material decline or prolonged weakness in rates for LNG carriers, FSRUs or FLNGs; changes in the performance of the pool in which certain of our vessels operate; changes in trading patterns that affect the opportunities for the profitable operation of LNG carriers, FSRUs or FLNGs; changes in the supply of or demand for LNG or LNG carried by sea; continuing volatility of commodity prices; changes in the supply of or demand for natural gas generally or in particular regions; changes in our relationships with our counterparties, including our major chartering parties; changes in our relationship with our affiliates and the sustainability of any distributions they pay to us; a decline or continuing volatility in the global financial markets; changes in general domestic and international political conditions, particularly
where we operate; changes in the availability of vessels to purchase and in the time it takes to construct new vessels; failure of shipyards to comply with delivery schedules or performance specifications on a timely basis or at all; changes to rules and regulations applicable to LNG carriers, FSRUs, FLNGs or other parts of the LNG supply chain; our inability to achieve successful utilization of our fleet or inability to expand beyond the carriage of LNG and provision of FSRU and FLNGs, particularly through our innovative FLNG strategy; actions taken by regulatory authorities that may prohibit the access of LNG carriers, FSRUs and FLNGs to various ports; increases in costs, including, among other things, wages, insurance, provisions, repairs and maintenance; and other factors listed from time to time in registration statements, reports or other materials that we have filed with or furnished to the Securities and Exchange Commission, or the Commission, including our most recent annual report on Form 20-F.
As a result, you are cautioned not to rely on any forward-looking statements. Actual results may differ materially from those expressed or implied by such forward-looking statements. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise unless required by law.
© Golar LNG Limited | 1 |
In a world with focus on ESG:
LNG is an attractive energy source in strong growth
LNG EXPECTED TO TAKE AN INCREASING PART IN MEETING WORLD ENERGY DEMAND
Renewables | 2) |
Nuclear 5% | LNG 3% |
Hydro 4% | |
7% | NatGas |
(excl LNG) | |
Today1 | 21% |
258 MBBLSPD
+8%
Increase in world energy demand
LNG the 2nd fastest growing energy
source after renewables, expected to
2)
Renewables | LNG 5% | |
17% | ||
Nuclear | NatGas | |
5% | ||
(excl LNG) | ||
20301 | ||
Hydro | 24% | |
8% | 279 MBBLSPD |
Coal 27%
Equivalent
Oil
33%
grow by 50%+ from 360mT to 550mT
Oil and Coal from 60% to 49%
Of global energy demand
Equivalent |
Coal | Oil |
19% | |
30% | |
INDUSTRIAL | NATURAL GAS EMISSIONS FOOTPRINT COMPARED TO OTHER HYDROCARBONS | TRANSPORTATION | ||
448% | 1,033% | 478% | 2,600% | ||||||
Diesel | 300% | ||||||||
Fuel Oil-to-LNG | LNG-fuelled Containership | ||||||||
to | 73% 100%108%130% | ||||||||
Barcarena Alumina Plant | 66% 100%100% | 100% | 100% | 20,000 TEU vessel | |||||
600,000 tons CO2 saved3 | Compared | 0% | 32% | 23,000 tons CO2 saved | |||||
= | CO2 | NOx | SOx | PM10 | = | ||||
Trees equivalent to | 10,000 Gasoline cars | ||||||||
Natural Gas | Diesel | Residual Fuel Oil | Low-Sulphur Coal | ||||||
10x Manhattans4 | replaced by EVs5 |
© Golar LNG Limited | (1) | BP World Energy Outlook 2020 | (4) https://www.encon.be/en/calculation-co2-offsetting-trees | 2 |
(2) | IHS Connect | (5) https://www.carbonbrief.org/factcheck-how-electric-vehicles-help-to-tackle-climate-change | ||
(3) | Norsk Hydro Q2/21 report | |||
The LNG value chain and Golar's asset portfolio
THE LNG VALUE CHAIN
F L N G | |||||
L N G | |||||
F S R U | |||||
GOLAR LNG ASSET BASE: STRONG POSITION ACROSS VALUE CHAIN
FLNG | Shipping | Investments | ||
Golar Bear | Golar Seal | ||||||||
FLNG Gimi (under | |||||||||
FLNG Hilli Episeyo | |||||||||
construction) | Golar Crystal | Golar Kelvin | |||||||
Golar Gandria (for | Golar Frost | Golar Snow | |||||||
Golar MkIII design | |||||||||
conversion) | |||||||||
Golar Glacier | Golar Ice | ||||||||
Golar Arctic | |||||||||
Golar Tundra | |||||||||
(8.9%)
(23.6%)
© Golar LNG Limited | 3 |
Short-term FLNG earnings driver:
Commodity-linked increased capacity utilization on FLNG Hilli
HILLI PRODUCTION VOLUME EVOLUTION FOR REMAINING FIRM CONTRACT PERIOD
% of capacity
100%
75%
50%
25%
0%
2023+ Incremental | 2022 Incremental | Base | |||
2.4 | year |
2.0 | |
per | |
1.6 | |
tons | |
1.2 | |
0.8 | Million |
0.4 | |
0.0 |
2021 | 2022 | 2023-2026 (Option declarable in 2022) |
HILLI HAS POTENTIAL TO GENERATE $180m+ IN 2022 AT CURRENT PRICES WITH UPSIDE TO $240m+ ANNUALLY FOR 2023-2026
4 Adjusted EBITDA (mUSD)
300
250
200
150
100
50
0
Base1 | Oil Derivative | 2 | T3 Incremental | 3 | ||||||
244 | 300 | |||||||||
181 | 250 | |||||||||
200 | EBITDA | |||||||||
132 @ $23/MMBTU | ||||||||||
150 | ||||||||||
84 | 69 @ $23/MMBTU | |||||||||
38 @ $74/BBL | 38 @ $74/BBL | 100 | ||||||||
10 | ||||||||||
50 | ||||||||||
74 | 74 | 74 | ||||||||
0 | ||||||||||
2021 (Last 12M) | 2022 | 2023-2026 (Annual run-rate) | ||||||||
2022 Earnings sensitivity | 2023 Earnings sensitivity | ||||
Brent: $1/bbl = $2.7m | Brent: $1/bbl = $2.7m | ||||
TTF: $1/MMBTU = $3.2m | TTF: $1/MMBTU = $6.5m | ||||
(1) | Based on last twelve months EBITDA on base capacity of 1.2million tonnes per annum. | (5) Assumes no change to existing accounting treatment | |||
© Golar LNG Limited | (2) | Based on last price for Platts dated brent index on 14th of September 2021 | 4 | ||
(3) | The ICE last OCT21 contract on close 14th of September 2021 | ||||
(4) | Please see the appendix for definition on the non-GAAP measures. | ||||
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Golar LNG Ltd. published this content on 16 September 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 16 September 2021 12:51:04 UTC.
