Bermuda-based Golar LNG, the owner and operator of liquefied natural gas carriers on Wednesday reported a net loss of US$99.5 million.
The shipping company’s adjusted operating loss was cut slightly from $42.7 million in the first quarter to $37.1 million in the quarter under review, according to the company’s latest quarterly report.
“Although headline shipping rates remained relatively unchanged during the quarter there was a modest improvement in utilization which increased from 24 percent in 1Q to 31 percent in 2Q,” the report reads.
With the utilization increase, Golar’s total operating revenues increased from $16.6 million in the first quarter to $18.4 million in the second quarter.
LNG Shipping business
During the quarter, 22 spot voyages were concluded by the Cool Pool relative to only 8 commencing in the first quarter, Golar LNG said.
The additional activity was initially supported by an Enarsa tender for 35 cargoes into Argentina early in the quarter followed by tenders for additional cargoes into Egypt.
However, despite the increase in activity, hire rates remained at low $30,000 per day for TFDE tonnage and sub $20,000 per day for modern steam vessels, during the quarter.
Subsequent to the quarter end, chartering activity and LNG charter rates have climbed steeply, Golar LNG said, noting that ramped up production from new facilities that started producing in late 2015/early 2016, the withdrawal of spot traded ships in anticipation of the imminent start-up of their dedicated project volumes and more trading activity to service recently installed FSRU capacity have collectively started to absorb some of the excess spot tonnage, increasing the rates as a result.
Golar LNG believes that there is cautious confidence among shipowners in the market in the following 12 to 24 months. Currently, the round-trip voyages fetch $40,000 per day in the Atlantic basin and mid $30,000 per day in the Pacific.
FSRU Tundra arrives in Ghana
During the quarter, Golar LNG’s FSRU Tundra has arrived in Ghana and issued its notice of readiness.
Amounts due under the contract started to accrue from mid-July, Golar LNG said adding that charterers of the FSRU, West Africa Gas Limited have experienced significant delays with respect to the part of the project for which they are responsible.
Golar Partners who own the FSRU Tundra are however entitled to payment of hire.
The company has been assured that the project remains intact and is in contact with WAGL in order to find a way to bring the project forward.