Golar LNG (GLNG) in 2023

Investment Analysis Clubs Value Hounds
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There’s a GLNG thread I started in Oct 2022.
Subsequent developments at the company were reported in that thread
Applying Druckenmiller’s advice: GLNG? - Investment Analysis Clubs / Value Hounds - Motley Fool Community

Golar LNG (GLNG) reported their Q4 2022 results on 02/28/23.
Let me include the Feb 2023 transaction in which Golar used $100M in cash, plus its remaining 4.1M NFE shares to acquire its 50% interest in T1 and T2 production of FLNG Hilli. It also includes a portion of FLNG Hilli debt. Having said that, then a one sentence summary of Golar LNG is as follows–
For 2023, Golar LNG (GLNG) has become a very focused Floating Liquefied Natural Gas (FLNG) entity with an almost complete dependence on Hilli FLNG asset for revenue.

Sure, there’s a small portion of revenue coming from revenue generated by an LNG tanker. But, it is a penny, or two, to the dollar when compared to the revenue generated by the FLNG Hilli asset. Towards the end of 2023, the second FLNG asset, Gimi, should start its 20-year contract with BP.

What else has happened with GLNG in Q4 2022 - Q1 2023?
Well, the company has

  • sold the remainder of its New Fortress Energy (NFE) stake
  • sold all its Cool Co stake
  • monetized on natural gas hedges in 2023 & 2024
  • Bought back $141M of its unsecured bonds at par
  • ordered $300M in long lead items for a FLNG Mark II design.
  • acquired a 2004-build LNG vessel for a FLNG Mark II project *
  • Has lots of cash
  • It should be noted that Golar already own an existing LNG tanker that is slated for LNG conversion. But, my guess, is the vessel probably does not have the necessary specs for a Mark II conversion.

Microsoft PowerPoint - Golar LNG Q4 22 Quarterly Results Presentation LIVE - Read-Only (seekingalpha.com)

Golar management have been indicating entities have FLNG plans, but so far, nothing has materialized, While the overdependence on FLNG Hilli (for 2023) represents a major risk, it is somewhat mitigated by Golar large cash hoard. Now, if only a major player showed up and said - we need a vessel for an FLNG project!

Small GLNG stake
HohumYNWA

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BTW, Golar mgmt offered two different options on a value calculation during the Q4 2022 earnings call

  1. Value of $2.9B, or $26.85/sh at year-end
  2. Value based on GLNG’s share of liquefaction capacity available (assumes one is counting Gimi’s capacity as being available currently) and a $1000 per annual metric tonne, would value GLNG @ $38/sh.

Again, the latter method is more of using Druckenmiller’s projection idea and doesn’t seem like such a stretch given the Gimi asset is 90+% technically complete, and the company removed most variability by monetizing the hedges and monetizing on its CoolCo investment.