Höegh LNG signs revised FSRU agreement with Perusahaan Gas Negara (PGN) in Indonesia

abarrelfullabarrelfull wrote on 26 Oct 2012 08:07
Tags: asia höegh indonesia lng

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Reference is made to the stock exchange notice dated 25 January 2012, where Höegh LNG Holdings Ltd. ("Höegh LNG" or the "Company") informed that the agreement with PGN for the Medan LNG Floating Storage and Regasification Unit ("FSRU") and mooring to be located offshore Belawan in North Sumatra, Indonesia, had been signed.

Furthermore, reference is made to the stock exchange notice dated 23 March 2012, where Höegh LNG informed that at the request of the Indonesian Government, PGN had decided to change the location of the FSRU from offshore Belawan to offshore Labuhan Maringgai, in the Lampung province, at the south east coast of Sumatra, Indonesia.

PGN and Höegh LNG have today signed the amended terms for providing the FSRU and mooring for the new project location in Lampung. Höegh LNG will provide the FSRU under construction at Hyundai Heavy Industries in South Korea as previously agreed, with modifications as required by PGN. The agreement is as before for a firm 20 year charter with two five year options to extend for a total period of 30 years. The EBITDA contribution from the FSRU lease is approximately USD 40 million per year for the firm 20 year period. As under the initial agreement, the mooring system will be paid for and built by Höegh LNG, but under the new
agreement, PGN will take title to and reimburse Höegh LNG for the full investment of the mooring system, including financing cost, upon completion.

This means that from start-up, Höegh LNG's investment is solely the FSRU itself. Due to the change of location and the new mooring system, the planned start-up date has been moved to June 2014, and Höegh LNG will receive full compensation for the delayed start-up.

President and Chief Executive Officer, Sveinung Støhle, says:
"We are very pleased to have agreed the revised terms for the move of PGN's floating LNG import terminal project from North Sumatra to Lampung. The ability to apply the FSRU at a different terminal location is evidence of the flexibility and value these solutions bring to our customers. We are looking forward to working with PGN to complete its first FSRU project, utilising our initial newbuilding at Hyundai Heavy Industries in South Korea."

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