Norway’s floating LNG giant Höegh LNG reported a $4.5 million profit for the first quarter of the year.
The profit dropped from $45 million in the previous quarter and $13.2 million in the corresponding quarter, as the company recognized $40.3 million of revenue under the suspension and settlement agreement with Egas in the fourth quarter of 2018.
The company said in its report that the total income reached $84.3 million for the first quarter, compared with $122.3 million in the preceding quarter.
More days in FSRU mode for Höegh Esperanza and a full quarter of revenues under Höegh Gannet’s interim LNG carrier charter contributed to total income in the first quarter of 2019, while lower income under Höegh Giant’s spot-market related LNG carrier charter and certain tax elements booked in the fourth quarter offset these positive factors.
Höegh LNG noted that it currently has three projects in the pipeline and is in the final selection round for a fourth FSRU. The company has secured deals for its floating storage and regasification units with AGL Energy and Australian Industrial Energy in south-east Australia both depending on the final investment decision. The third project is being targeted for a south Asian market.
The fourth project, where Höegh LNG is in the final selection round, is targeting a final selection by mid-2019.
The group is involved in several additional selection and tender processes at various stages of development. China remains a key focus area, since growth in regasification capacity has lagged behind the increasing demand for natural gas for the Chinese market.
Additional prospective projects which require FSRU newbuildings continue to come to market across all geographical regions. Although the strategic rationale of prospective projects may be robust, a combination of political, commercial, technical, financial and/or other factors affects FSRU developments and makes the outcome of ongoing tendering processes difficult to predict until they are completed.
Looking forward, Höegh LNG expects the operating results in the second quarter of 2019 to be affected by fewer days in FSRU mode for Höegh Esperanza, since it will serve as an LNGC for CNOOC on fixed terms during the summer months.