JAKARTA (rambuenergy.com) – Golar LNG Ltd said it has completed the sale of the 2005 built LNGC Golar Viking to PT Perusahaan Pelayaran Equinox (Equinox) for US$ 135 million. The vessel has been re-named “Salju” under Indonesian flag and Registry.
Under Indonesian Cabotage regulations, LNG cargoes produced and sold within Indonesia must be transported on an Indonesian flagged vessel. With an anticipated increase in domestic allocation for Indonesian produced LNG cargoes in 2015, Equinox believe the timing is right to acquire the Golar Viking and transfer the vessel to Indonesian flag.
The growth in the Indonesian domestic trade of LNG is the direct result of the recent introduction of 3 new LNG Terminals which are supplied from LNG production facilities at Bontang and Tangguh. The receiving Terminals are the FSRU Nusantara Regas Satu (commenced operations in Q2 2012) located in West Java, FSRU Lampung owned by PT Perusahaan Gas Negara (PGN) located in Lampung and the Arun Receiving Terminal in Aceh Province, which is ready to commence operations in this quarter.
FSRU Nusantara Regas Satu is owned and operated by PT Golar Indonesia, a joint venture company between Golar and Equinox’s parent company. The FSRU was rented to PT Nusantara Regas, a joint venture between PT PGN and PT Pertamina.
Golar said the technical specification of Golar Viking, now renamed Salju, is well suited for the short haul nature of the domestic Indonesian trade. The transfer of ownership and the anticipated future employment of the vessel recognizes that long haul sea borne trade will increasingly become dominated by modern, larger and more efficient vessels providing greater economies of scale.
In connection with the sale, Golar has repaid a secured bank loan of approximately US$ 82 million. The sale was concluded at the vessel’s approximate book value as at December 31, 2014 and Golar therefore do not expect this transaction to materially impact its first quarter results for 2015.
“The sale of the vessel in support of Equinox’s aim of actively servicing Indonesian domestic LNG shipping demand fits with our strategy of maximizing cash flows in the currently challenging shipping environment. Golar’s support to Equinox strengthens the ties we have with our long term partners in the important Indonesian market,” said Gary Smith, CEO Golar Management. (*)