Golar LNG Q1 2025 Earnings Report

Golar LNG EPS Results

• Actual EPS: $0.38
• Consensus EPS: $0.29
• Beat/Miss: Beat by +$0.09
• One Year Ago EPS: N/A

Golar LNG Revenue Results

• Actual Revenue: $63.00 million
• Expected Revenue: $64.90 million
• Beat/Miss: Missed by -$1.90 million
• YoY Revenue Growth: N/A

Golar LNG Announcement Details

• Quarter: Q1 2025
• Date: 5/27/2025
• Time: Before Market Opens
• Conference Call Date: Tuesday, May 27, 2025
• Conference Call Time: 8:00AM ET

Golar LNG (NASDAQ:GLNG) designs, converts, owns, and operates marine infrastructure for the liquefaction of natural gas. The company operates through three segments: FLNG, Corporate and Other, and Shipping. It engages in the regasification, storage, and offloading of liquefied natural gas (LNG); operation of floating liquefaction natural gas (FLNG) vessels or projects; transportation of LNG carriers; and vessel management activities. Golar LNG Limited was founded in 1946 and is headquartered in Hamilton, Bermuda.

Golar LNG Q1 2025 Earnings Call Transcript

Key Takeaways

• Golar secured two 20-year charters—one for redeploying FLNG Hilli to Argentina and another for the Mark II FLNG—delivering a combined EBITDA backlog of $13.7 billion (and ~$17 billion total) before commodity upside.
• Q1 results showed $63 million in operating revenues, $41 million EBITDA and $13 million net income, with $680 million of cash and a net debt/EBITDA ratio of 2.8x, underpinning a projected $835 million EBITDA run rate by 2028.
• The Fuji conversion into a 3.5 mtpa Mark II FLNG at CMC Rafals is on schedule for delivery by end-2027, with long-lead equipment on site and definitive charter agreements subject to the same CPs as Hilli.
• Contracts include a 25% share of LNG prices above $8/MMBtu (≈$70 million EBITDA per $1) plus a 10% equity stake in Southern Energy (≈$28 million per $1), providing ≈$100 million EBITDA for each $1 of spot upside, with downside capped at $210 million.
• Refinancing Gimi and pursuing a bond rating could release ~$370 million of equity and unlock up to $1.9 billion at ~5x leverage to fund new FLNG units, while maintaining a strategy of one uncontracted vessel.

Presentation

[Operator]

Welcome to the Golar LNG Limited First Quarter twenty twenty five Presentation. After the slide presentation by the CEO, Karl Frederic Staubo CFO, Eduardo Moreno CTO, Morten Skong and Chairman, To Olav Triom. There will be a question and answer session. Information on how to ask a question will be provided then. At this time, all participants are in a listen only mode.

[Operator]

I will now pass you over to Karl Friedrichs Karl, please go ahead.

[Karl Fredrik Staubo, CEO at Golar LNG]

Thank you, operator, and welcome to Golar LNG's Q1 twenty twenty five earnings results presentation. My name is Karl Fredrik Stabo, CEO of Golar LNG, and I'm very pleased to be accompanied today by our Chairman, Mr. Tor Olav Trem our CFO, Eduardo Maranhao and our Chief Technical Officer, Mr. Morton Schong, to present this quarter's results. Before we get into the presentation, please note the forward looking statements on Slide two.

[Karl Fredrik Staubo, CEO at Golar LNG]

As normal, we start on Slide three with an overview of Golar today. Golar is now a focused FLNG company. We own three units, of which two is on the water and one is on the conversion. The key event of the quarter was securing of two twenty air charters, one for our FLNG Hilli following the end of our current charter in Cameroon in July as well as entering into definitive agreements for a twenty year charter for our Mark II FLNG under construction. As announced on our Q4 call, we have now fully exited LNG shipping with the sale of the Golar Arctic and our sale of the equity stake in Avenir LNG.

[Karl Fredrik Staubo, CEO at Golar LNG]

We currently have a market cap of around $4,000,000,000 a total net debt of shy of hundred million dollars and a fully delivered net debt to EBITDA of around 2.8x. Our strong cash flow visibility, solid balance sheet and market leading position as the only proven provider of FLNG as a service sets the company up for continued attractive FLNG growth. We have three FLNG designs available for growth, and we will elaborate on our growth ambitions as we go through today's presentation. Turning to Slide four and a focus on Hilli, which is still the best performing FLNG globally. Hilli continued her market leading 100% operational uptime during the quarter.

[Karl Fredrik Staubo, CEO at Golar LNG]

Hilli has now delivered 132 cargoes since contract commencement in 2018 or more than 9,200,000 tonnes of LNG produced. On May 2, all CPs for her twenty year redeployment in Argentina was concluded, and final investment decision was given. This secures $5,700,000,000 of EBITDA backlog before commodity upside. We have now designated a dedicated team of project and operations people to the redeployment scope for Hilli's planned vessel upgrades and transit from Cameroon to Argentina to facilitate for twenty years of on-site operations. On Slide five, we focus on our second FLNG, the Gimi, which is in her final stage of commissioning and to start her twenty year charter for BP offshore Mauritania and Senegal.

[Karl Fredrik Staubo, CEO at Golar LNG]

The commencement of operations date will activate the vessel on our P and L statement. Golar share of the contractual EBITDA is $151,000,000 based on 90% capacity utilization. Any production above such level will translate into a pro rata increase in Golar shares of EBITDA generation by Gimi. Following the commercial reset announced in August, Golar has invoiced $196,000,000 in pre COD payments from the GTA upstream partners. This amount is recognized on our balance sheet and will be amortized over the contract duration.

[Karl Fredrik Staubo, CEO at Golar LNG]

We have now successfully offloaded two LNG cargoes and expect COD to remain on track within this quarter. That should mark the start of the twenty year contract period. The picture on the bottom left is from Thursday last week, where we attended an official state visit by the presidents of Senegal and Mauritania to the GTA Hub, together with senior management from BP, Kosmos, SMH and PetroSEN, marking the introduction of Senegal and Mauritania as LNG exporting countries. Turning to Slide six for an update on our Mark II FLNG conversion. The conversion of the LNG carrier, Fuji, into a 3,500,000 tonnes per annum Mark two FLNG is well into construction.

[Karl Fredrik Staubo, CEO at Golar LNG]

During Q1, the Fuji arrived at the shipyard in China. The vessel has now been divided in two and skidded onshore. The liquefaction plant that will be built on a new midship section is well underway, and a significant portion of our long lead items have arrived at the shipyard ready for installation. The project remains on schedule for delivery by year end twenty twenty seven. On May 2, simultaneous with the final investment decision for the FLNG Hilli charter in Argentina, we entered into definitive agreements for a twenty year charter for the Mark II to operate alongside Hilli in Argentina.

[Karl Fredrik Staubo, CEO at Golar LNG]

The contract is subject to the same CPs as for the Hilli when we entered into her definitive agreements in July. These CPs include environmental assessment, export license, rigi protection and final investment decision by the partners. All the CPs are expected to be lifted within 2025, and we expect the relevant approvals to benefit from the recent Tilley process. The CapEx to EBITDA for the Mark II is around 5.5x before commodity upside for a twenty year charter period, with a further five year extension option in the charterer's favor. On Slide seven, we have visualized these substantial charter developments on a slide.

[Karl Fredrik Staubo, CEO at Golar LNG]

Our contract backlog now stands at more than sixty years of combined contract backlog across our three FLNGs. Or in dollar terms, we have an EBITDA backlog of approximately $17,000,000,000 before commodity exposure. The existing fleet is now fully contracted, and we are progressing towards our express target to transform into a market leading infrastructure company with attractive commodity upside. In the next section, we will elaborate further on the key attributes of our FLNG charters in Argentina. Turning to the next section and Slide nine, we illustrate the LNG value chain and Southern Energy's role in introducing Argentina

[Karl Fredrik Staubo, CEO at Golar LNG]

As part of the Argentina deal, Southern Energy has secured fixed price gas sales agreements for twenty years from the upstream partners of CESA to provide the project with natural gas sourced from the Vaca onshore field in Argentina. CESA will be responsible to facilitate for a dedicated pipeline to bring the natural gas from the Vaca Muerte to the FLNG location in The Gulf Of San Matias, a distance of about 500 kilometers. This will equate into a fixed pipeline fee to CESA. CESA will then be responsible for chartering and operating the FLNGs as well as marketing of the gas. Hence, CESA's responsibilities include all activities to be taken from the Vaca Muerte until LNG is produced and ready for export.

[Karl Fredrik Staubo, CEO at Golar LNG]

The export point price is referred to as free onboard. The difference between free onboard prices and the LNG prices you typically recognize on your screen is the shipping costs from the production site to its destination of consumption. The destination price is referred to as delivery ex ship or DES pricing, as highlighted on the slide. As part of the charterers, Golar will receive 25% of all achieved LNG prices above $8 per MMBtu in FOB price. Hence, when considering the upside element, the applicable methodology is to consider desk prices less $1 to $2 per MMBtu in shipping costs.

[Karl Fredrik Staubo, CEO at Golar LNG]

In the current market, TTF and JKM spot prices are trading around $12 Hence, today, there's a $2 to $3 upside above the $8 threshold if the project was producing today. Turning to Slide 10 and some of the contract highlights. Both vessels have a twenty year contract term. Hilli will have an annual EBITDA of $285,000,000 and $400,000,000 for the Mark II. OpEx is pass through for both vessels.

[Karl Fredrik Staubo, CEO at Golar LNG]

Both EBITDA tariffs are subject to a CPI adjustment equivalent to 30% of U. S. CPI from year six. Both vessels have the same upside element of 25% above $8 FOB. And combined, the two contracts provide Golar with an EBITDA backlog of $13,700,000,000 before the mentioned CPI adjustment and the commodity upside.

[Karl Fredrik Staubo, CEO at Golar LNG]

Turning to Slide 11 and further elaborating on the commodity upside element of the charters. As explained, Golar will have a 25% upside above 8%. For every dollar above, we have an annual EBITDA of around $70,000,000 Over the contract lifetime, that would equivalent to $1,400,000,000 of EBITDA backlog for every dollar achieved pricing is above it. Importantly, this calculation is based on monthly achieved prices. We have also introduced a limited downside element, where Golar gave a temporary discount should annual average FOB prices be below $7.5 and down to $6 This is capped at a total exposure of $105,000,000 over two years, which is equivalent of $210,000,000 Hence, the total commodity exposure for the contract has a maximum downside of $210,000,000 in return for no cap on the upside.

[Karl Fredrik Staubo, CEO at Golar LNG]

If this contract was in place over the course of the last five years, you can see in the table on the bottom right that we would have meaningful additional EBITDA above the contracted amounts. If you take the extreme example of 2022, the commodity element alone would contribute $1,700,000,000 to $2,100,000,000 of additional EBITDA to Golar if the contracts were in place at that time. Even today, if the contracts were operational today, we would see an additional contribution above the contracted amount of an additional $250,000,000 So to summarize this simplistically, for every dollar FOB prices are above $8 Golar makes an additional $70,000,000 of annual EBITDA. Turning to Slide 12 and the further commodity exposure that's inbuilt into the contracts. Golar is a 10% shareholder in Southern Energy, alongside our upstream partners Pan American, YPF, Pampa Energia and Harbor Energy.

[Karl Fredrik Staubo, CEO at Golar LNG]

Hence Golar makes an additional 10% of commodity exposure. This has no downside cap or upside cap, so a true fully aligned shareholder, where a $1 change in the gas price impacts Golar's EBITDA generation by around $28,000,000 Hence, if you combine the $70,000,000 upside tariff and the $28,000,000 equity ownership, dollars 1 change provides Golar with approximately $100,000,000 of EBITDA upside. This is further illustrated on Page 13, where you can see our EBITDA buildup. Hilli has a base tariff of $285 mark to of $400 Combined, that's $685 The downside element we have is linked to our equity ownership in CESA, and the rest is upside. Every dollar above eight equates to around $100,000,000.

[Karl Fredrik Staubo, CEO at Golar LNG]

Every dollar below is a downside of around 28. We see this as a highly attractive risk reward. And also in light of current and future LNG prices, we expect meaningful additional EBITDA contribution from the commodity element. Turning to Slide 14. Contracting in Argentina has historically not been fully without risk, And we have gone to a great extent to look at risk mitigation, both regulatory and legally in the framework supporting the charters.

[Karl Fredrik Staubo, CEO at Golar LNG]

Some of the highlights include English law for all charters. All payments are made in US dollars. The Malay led government of Argentina has introduced several regulatory frameworks to boost domestic investment in Argentina. And we are pleased to have received the support of both the state and local authorities to achieve the first ever thirty year non interruptible LNG export license in the case of FLNG Hilli. And we have also been accepted to the large investment incentive scheme under the RIGI protection, which was a law introduced last year.

[Karl Fredrik Staubo, CEO at Golar LNG]

The important highlights of the RIGI includes certainty and regulatory stability for the duration of the project. We cannot be subject to any new national, provincial or municipal taxes. And we have full freedom to repatriate profits, dividends and capital during the life of the contract term. These are the same protections that are the CPs that we will meet for the Mark II charter. Turning to Slide 15 and looking at the global LNG market and how our CESA contracts are placed in the wider scheme of the markets.

[Karl Fredrik Staubo, CEO at Golar LNG]

When entering this year, the LNG market stood at around four thirty million tonnes, where The USA is the largest current producer with a 23% market share. More importantly, the significant expected growth in the coming years is driven by volumes out of The U. S. Hence, we want to identify ourselves with projects that are highly competitive versus U. S.

[Karl Fredrik Staubo, CEO at Golar LNG]

Exports as the marginal producer. If you look on the cost curve on the right hand side, you can see that the delivered price of U. S. Export projects is north of $10 per MMBtu. If we then further elaborate on Slide 16 how the recently announced Argentina Golar contracts stack up versus US liquefaction projects, there are some interesting data points to note.

[Karl Fredrik Staubo, CEO at Golar LNG]

First and foremost, the gross tariff that we have achieved is significantly higher than that of recently entered into US liquefaction projects. The EBITDA tariff you typically see in The US is net of OpEx and maintenance costs, hovering around $2 whilst we have secured around $2.45 The CapEx per tonne is currently sitting of around $1,000,000,000 for U. S. Liquefaction projects versus $600,000,000 in the case of the Mark II. Inflation adjustment is typically hovering between 2030% in The US, Thirty Percent for our contracts in Argentina.

[Karl Fredrik Staubo, CEO at Golar LNG]

In addition, there's no commodity upside for US liquefaction tolling arrangements, whilst we have the mentioned 25% above $8 of FOB. Hence, what does these characteristics mean? Well, if you have a higher EBITDA tariff and a lower CapEx per tonne, you have a higher return on capital employed. Our commodity upside within the tariff provides us with strong upside participation without spot cargo risk. The fixed price gas sales agreement for twenty years provides CESA with a call option on international LNG offtake prices for twenty years.

[Karl Fredrik Staubo, CEO at Golar LNG]

I think no one knows exactly where the gas price is, but you know it will be volatile, and we are there to capture 25% of monthly volatility. The OpEx pass through, combined with our 30% CPI adjustment, provides for improved inflation protection versus U. S. Liquefaction projects. Hence, all in all, we believe we compare very favorably to the alternative infrastructure investments within LNG liquefaction.

[Karl Fredrik Staubo, CEO at Golar LNG]

This is further illustrated on Slide 17. Starting off with the graph on the far left, you want to have as low as possible CapEx per tonne and as high as possible average tariff in dollars per MMBtu basis. And compared to some of the listed U. S. Liquefaction alternatives, we compare favorable on both measures.

[Karl Fredrik Staubo, CEO at Golar LNG]

Then you want long term cash flow visibility. We now have twenty year across all of our three assets, hence, that's the remaining average life of our contracts. Lastly, to the far right, we've looked at capital markets pricing on a per a liquefaction capacity basis. If you take total EV and divide over liquefaction capacity in operation, you can see that Golar is trading at just north of $1,000,000,000 per tonne, whilst our US colleagues are trading more favorably. If you were to include a fairly significant growth program across all the three companies, you can see that the capital markets pricing further reduces in the case of Golar to shy of $900,000,000 per tonne, whilst comparing to our U.

[Karl Fredrik Staubo, CEO at Golar LNG]

S.-listed pairs have a significantly higher pricing. If you were to put that pricing into Golar share price, that would be a very meaningful pickup from our current capital markets pricing. Moving on and turning to business updates on Slide 19. The highlights of the quarter across the BD department is obviously the final investment decision for Hilli, the definitive agreements for the Mark II. However, we continue to see strong progress on further FLNG commercial developments.

[Karl Fredrik Staubo, CEO at Golar LNG]

There are very few yard slots that can deliver within the 2020s. And we now see increased attention from the projects that lost out on the Hilli and the Mark II. We continue to target opportunities with competitive wellhead gas to secure an attractive base tariff with commodity upside participation. We are in detailed commercial conversations across our different vessels designs, Mark one, two and three. And some of these discussions include projects where the charterer may want an equity participation in the FLNG.

[Karl Fredrik Staubo, CEO at Golar LNG]

I'll now hand the call over to our Chief Technical Officer, Mr. Morten Schong, to further elaborate on our service offering and the different designs available for growth.

[Morten Skjong, CTO at Golar LNG]

Good morning, good afternoon. In Golar, we have three different FLNG designs, the Mark I, the Mark II and the Mark III. These range in LNG liquefaction capacity from around 2,000,000 tonnes per annum up to a maximum of 5,400,000 tonnes per annum. This depends on FLNG configuration, feed gas properties and ambient conditions at the site. The Mark one at SeaTrium is a highly successful design with two units on the water and a stellar track record for the Hilli during its contract in Cameroon for Perenco.

[Morten Skjong, CTO at Golar LNG]

Meanwhile, our first Mark II conversion is progressing well at CMC Rafales, and the EPC contract contains an option agreement for a second vessel. Our Mark III reflects years of innovative engineering and Samsung's world leading FLNG track record. Common to all three designs is Black and Veatch Pre Co liquefaction technology, enabling Golar to harvest vital lessons learned between FLNG designs. The most important commonality is, however, the input and leadership from Golar's world class projects and operations teams. With Hilli's FID and the signing of definitive agreements for the Mark II in Argentina, we are now advancing work with our contractors to confirm updated price and schedule for our FLNG designs.

[Morten Skjong, CTO at Golar LNG]

We've also completed ship inspections for potential donor vessels for either a Mark one or a Mark two, and we are confident that we can secure a conversion candidate with Fuji's LNG storage capacity or higher at an attractive price. Furthermore, we are in discussions with long lead equipment suppliers for slot reservations or preorders to ensure that lead times for critical equipments will support the overall schedule for our next project. The work we are doing now will enable us to proceed with at least one FLNG EPC award this year and whatever design we choose within the 2020s. With that, I'll hand over to our CFO, Mr. Eduardo Marnau, for the Q1 group results.

[Eduardo Maranhão, CFO at Golar LNG]

Thank you, Morten, and good morning, everyone. I'm pleased to provide an overview of Golar's financial performance for the first quarter of twenty twenty five. Moving to Slide '22. Let's go through some of the key financial highlights of the quarter. We achieved total operating revenues of $63,000,000 FLNG tariffs reaching $73,000,000 in the quarter.

[Eduardo Maranhão, CFO at Golar LNG]

Total FLNG tariff in the last twelve months ended in Q1 reached $336,000,000 We refer to total FLNG tariff to illustrate the total revenues generated from FLNG Healy, including realized gains from TTF brand linked fees. In addition to this, Gimi has started to contribute to our cash flows. And as of May 2025, we have invoiced around $196,000,000 of pre COD fees under the commercial reset agreement, most of which has already been received. This amount is not showing our P and L and is currently being recognized on the balance sheet until COD. Total EBITDA reached $41,000,000 in Q1, largely driven by lower Brent and TTF prices.

[Eduardo Maranhão, CFO at Golar LNG]

Total EBITDA for the last twelve months ended in Q1 was $218,000,000 This quarter, we report a net income of $13,000,000 in line with the previous quarter. This figure is inclusive of a total of $32,000,000 of noncash items, such as adjustment in the value of embedded TTF and Brent derivatives within the Healy contract, as well as changes in our interest rate swaps. Our liquidity remains strong with approximately $680,000,000 of cash on hand at quarter end. I'll talk more about these and other initiatives on the financing front in the next slide. Lastly, we're pleased to declare a dividend of $0.25 per share this quarter, with a record date of June 3 and payment scheduled for June 10.

[Eduardo Maranhão, CFO at Golar LNG]

So this equates to around $105,000,000 per year on a run rate basis. Now turning to Slide 23. We now take a closer look on our debt position. At the end of Q1, we had just under $1,500,000,000 of gross debt when adjusted for our 70% stake on Gimi. On an asset level basis, based on the existing $17,000,000,000 EBITDA backlog that Karl spoke about before, our units are still significantly underlevered, considering the cash flow visibility beyond 2,045, with further growth from increased capacity utilization as well as commodity exposure.

[Eduardo Maranhão, CFO at Golar LNG]

Last March, we signed a $1,200,000,000 debt facility to refinance the FLNG Gimi with a consortium of leading Chinese leasing companies. This facility features a tenure of twelve years and a seventeen year amortization profile. Upon closing and repayment of the existing debt facility, we expect to generate net proceeds of approximately $530,000,000 of which 70% of these proceeds or an amount equivalent to $370,000,000 will be released to us. We are currently working on the remaining closing conditions, which includes third party stakeholder approvals, and we expect that closing could take place around summer. In addition to this initiative and to further evaluate

[Operator]

Ladies and gentlemen, please continue to stand by. Your conference will resume shortly. Thank you. Ladies and gentlemen, please continue to stand by. Your conference will resume shortly. Thank you for your patience.

[Eduardo Maranhão, CFO at Golar LNG]

Okay. I think you may now hear me back. So if we go back to Slide 23, we now take a closer look on our debt position. At the end of Q1, we had just under $1,500,000,000 of gross debt and adjusted for our 70% stake on Gimi. On an asset level basis, based on the existing $17,000,000,000 backlog that Karl mentioned before, our units are still significantly underlevered considering the cash flow visibility beyond 2,045, with further growth from increased capacity utilization and commodity exposure.

[Eduardo Maranhão, CFO at Golar LNG]

On March, we signed a $1,200,000,000 debt facility to refinance FLNG Gimi with a consortium of leading Chinese companies. This facility features a tenure of twelve years and a seventeen year amortization profile. Upon closing and repayment of the existing debt facility, we expect to generate net proceeds of approximately $530,000,000 of which 70% of these proceeds or equivalent to $370,000,000 will be released to us. We are currently working on the remaining closing conditions, including third party stakeholder approvals and expect to close around the summer. In addition to this initiative and to further evaluate debt optimization alternatives, we have completed the rating process of the company with key rating agencies, us to tap the capital markets in a more efficient way in the future.

[Eduardo Maranhão, CFO at Golar LNG]

If we look at Healy, for example, we have an EBITDA backlog of more than $6,000,000,000 which gives us plenty of room to optimize its financing from the current levels of around $05,000,000,000 In addition to that, Mark II remains fully unencumbered, and so far we have invested around $700,000,000 of equity in each construction. So moving to Slide 24. We currently maintain a net debt position of around $800,000,000 which is projected to increase to approximately $2,300,000,000 upon completion of the Mark II remaining CapEx. By 2028, with Mark II fully operational, our anticipated fully delivered run rate EBITDA is expected to reach $835,000,000 before any further commodity upside. This positions us with a robust leverage ratio of 2.8 times net debt to EBITDA, supported by clear earnings visibility extending through 02/1945.

[Eduardo Maranhão, CFO at Golar LNG]

Assuming a conservative five times net debt to EBITDA ratio and leveraging on our secured long term contracts, the refinancing of our existing debt under optimized terms could potentially unlock over $1,900,000,000 of equity. This move aims to release additional equity, accelerating our growth initiatives, including the funding of additional FLNG units. Once these units are contracted, financing at similar leverage ratios of around five times EBITDA becomes viable. This approach allows us to efficiently recycle capital, facilitating sustainable and self funded expansion. That concludes my update.

[Eduardo Maranhão, CFO at Golar LNG]

I'll now hand the call back to our Chairman, Thor Olaf Triumph.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

Yep. Hi. I'm not gonna bother you for a long time. It's probably ten years since I've been on one of these calls, but I thought it was useful to just give a little recap on what have happened in this twenty five years since we took over and also give some credit to the people who have effectively created this company over the last years. I think SeaTankers took over Osprey as a conglomerate in 1999, '2 thousand.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

We then turned it into an L D growth vehicle. We had the ambition that L and D was a high commodity growth. And it seems like we were right because at that time, it was around 30 ships. I think today, we are more than 600. Also, the number of journal has increased dramatically in the periods at that time. So you were correct, but we were probably fifteen years too early in many ways, and that was part of the problem. We in 02/2001, we decided to go for shipping. People we went to conference, and we would change the market. We will do commodity shipping with spot tonnage. People told me we're crazy, but we need three, four years.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

We effectively had a situation where people followed us. I mean, we're effectively 30 people in the same kind of group, and the return went down. So we said we had to do something else. We then had some good technical experts in the company, developed LNG terminals carriers into terminals. And we met with president Lula in Brazil, and he wanted to be independent of Bolivian gas.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

And then suddenly, we became an FSRU company. Good return in the beginning. Same thing happened. Accelerate, BV, Livanos, Herg, everybody came after it, and there was no money there either. So in when we came to 2014, a major transformation was necessary.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

Glenn worked on the FN and D concepts from 02/2010. However, there was a big dispute between mister Fredrickson and myself, and that led to my departure from sea tankers. We then arranged the buyout of the 1,800,000.0 billion stake from from sea tankers with good support from institution holders, and then went ahead first FLNG order. It was a challenging start, but when oil market tipped in 2014, but we got a contract with Perenco on the first vessel. And we also hired the chairman from BP from BG, Frank Schapman, who was helpful in setting up the second contract, which we then got with Kosmos in history, but which was later concluded with BP.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

Then as prices fell in 2014, we also kind of went into the power cycle with our by Granta Nelo and a twenty five year power purchase contracts. We were actually pretty widely spread at that time, including the FSRU business, the carrier business, the power business, everything. Then we said, if you're gonna achieve something in this world, we have to focus. So we then decided to focus. We divested the cool company.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

We divested the power station when when the LNG prices came up again because the business was not that good any longer. And we also divested the kind of the the carriers in cool. When the market was strong, we sold it. So we were stuck with some LNG assets, and we had already at that time with what we now have done in the last year, build the largest FLNG company in the world. I'm also proud to say that Perenco are the people who have known us in the L and D business longest, which I consider to be the best oil company in the world when it comes to how they run their business.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

They know us from 02/2012, I think. And I think they've done business with us on the site since 2018. And now they're also our largest shareholder, and they also, as of last week, represented on the board. So so then when Carl and the team concluded backlog of $17,000,000,000 spanning over twenty years, is then the board disappointed that the latest deal has resulted in a higher share price. Yeah.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

To some extent, you probably are, but it's the same board who are there today who bravely rejected private equity offers pretty close to where we are today. At the time, the order book in this company was only 25% of the of what it is today because we knew at that time that we could deliver more value to shareholders over time. That say if you want to run the growth company, you need over time an effectively priced equity exclusion to continue the growth. If public investors are unwilling to wait two years before the strong cash flow comes in, the board is convinced that alternative strategy exists for this company. One possibility, which we are, I think, well into with with Eduardo and his team is to try look at the bond financing structure, which clearly will enhance the equity return in this company.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

Another one is to look at what came incoming last time, and I think we see some interest rate for it already. The interest private equity having a buying in order backlog was 17,000,000,000. As of that last time, they were close to paying what the share price is today. This time, the order backlog is four times bigger, so I assume the number is significantly higher. But but this is not what the board really want.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

I think the board wants to continue to build this company. We have confirmation of the mark two later on this year, which has been told to investors. We also have the possibility of concluding the commitment for vessel four and five within four and also maybe five within this year. We'll see what we and we're certainly gonna build more. We are undoubtedly having the yellow leader shirt in a in a business set for massive, massive growth.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

And think to put it in cyclic terms, we are in a pretty strong breakout. I don't see any competition behind us. And I think if you look into what happened in the FPSO industry, it grew effectively from two units to 250 units in forty years. I think we'll see a very similar track here. And the reason is the same.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

It's a lower cost economics to build floating units than it is to build this massive structure we build into all this on the land based L and D termites, and it provides significant more flexibility when you can move things around. You can also take higher political risk by going to countries you couldn't go to with a fixed installation. My former boss, he told me when I was 13, don't focus solely on money. If you bring the right people together and you have a good business idea, money will ultimately come to you big time. He started in Viking Cruises twenty five years ago, and today, the company is worth 20,000,000,000.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

He started from scratch and thought then probably have a fortune of more than 10,000,000,000. And it was all because he had a good idea and he had great people. It's exciting to have an earnings secured of 2 and a half million dollars a day for the next twenty years starting in 2728. But what is truly motivating me in as a chairman in this thing is the massive, massive opportunities we have to grow this company along with some of the best people, at least I ever worked together with. And I think some of them are extraordinary.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

If you think, for instance, about the chief executive we have in this company, I would say that it's probably by far up in I think I've probably worked with forty, fifty different people, and he's clearly among the top two, three guys I ever worked with as a chief executive. Fantastic guy. I think Maranal, great financial mastermind, not working strong on the financing. Morton is a brilliant CTO with continuously putting borders and and trying to come up with innovation. We have Marcus Brown who was the guy who created the whole Argentinian fight to get the with Calciandro and Antonello, Unbelievable people together.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

I'm not a guy who operates the Hilli and also the Gimi. You have perfect record. We have had them, Victoria delivered to BP, better than other people can do. We have processings here. We have a fantastic team as you see on the picture here on which describes the the whole Golar team.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

I think it's unbelievable. And I think this, in many ways, forget the $17,000,000,000 in assets. We have the smartest people. We have the same people when the FPSO company, SBM, said that we were going after FLND. They made us die.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

They put a crossover. It will never happen. That's the same unit to in seven years. I've delivered every day production and according to schedule and not had any downtime. I'm super excited by what to come here, but I'm super excited because of the opportunities and the team we have together.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

But the reason why the opportunity is so much better now is effective. We have $17,000,000,000 in backlog. So you have close to a billion to finance the growth going forward further. I think when you can find a business, everybody hates the kind of fossil industry these days, but I think the latest statistic from EHA shows that the electric consumption in this world went up with around 4% year on year. Out of that, effectively, 11% is fossil fuel, and renewable is down 2.1%.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

Gas is a major driver with 8%. I think if you are in the gas business, we have a massive growth area ahead of us. And if you can I think we can really do something monumental here? I think we should build assets for twenty year contracts at five times five times plus EBITDA. And add on top of that, you have an upside on the equity, which in this case, Argentina, goes to 30%.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

If gas price takes up, I think you have created something absolutely unique. I don't expect people to see this from day to day, But I think as you go along this story, it will unwell for most of the people. It took us twenty five years to get there. I'm sure it will take twenty five years for us to have any serious competition in this business as well. I think when major oil companies one of the three major oil companies in the world comes to us and say, we can't do this yourself.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

Are you willing to do it for us? I mean, they said, no. We're gonna do it for ourselves. I'm proud of what we have created. So I leave the back my word back to Carl, and I said, good luck.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

Look at the situation. Don't judge us day by day. But the company, we effectively over the last years have built $1,015,000,000,000 dollar year in order backlog. At least give us some credit. Thank you.

[Karl Fredrik Staubo, CEO at Golar LNG]

Thank you, Thor. Much appreciated for for kind words. I fully echo, especially, the words around the the organization, and it's also nice to know that I can stretch a bit further to to further increase the stake with versus the other CEOs that you've previously encountered. So we will keep working hard on our side. Thank you.

[Karl Fredrik Staubo, CEO at Golar LNG]

So to the final remarks, turning to slide 32. We now have twenty year plus charter on each assets. Obviously, Hilli concluding her contract in July and then repositioning to Argentina. Gimi to just about to start up her twenty year contract for VP offshore Mauritania in Senegal and Mark to conclude her conversion and sail straight to her twenty year charter in Argentina again. So to highlight, we have more than $17,000,000,000 of EBITDA backlog with significant commodity upside, as explained.

[Karl Fredrik Staubo, CEO at Golar LNG]

So for the final slide of the prepared remarks, turning to Slide 33 and some of the key milestones and focus that you should expect to see for the rest of the year. Jimmy has now concluded her two first LNG cargoes. The third cargo is underway, and COD is expected within Q2. We've concluded the FID of the twenty year charter with Southern Energy for Hilli with an adjusted EBITDA backlog of $5,700,000,000 We fully sold out of the shipping related assets, including Avenir and Golar Arctic and delivered Arctic to our new owners. Some of the remaining actions that you should anticipate and is our target for the remainder of the year is to conclude the refinancing on Gimi, as Eduardo explained, to conclude the conditions precedent for the twenty year charter for the Mark two, which are the same CPs as we have recently completed for the Hilli, to further target balance sheet optimization on the back of twenty year charters and recycle the capital for attractive FLNG growth units.

[Karl Fredrik Staubo, CEO at Golar LNG]

This concludes our prepared remarks for our Q1 call, and I'll now turn the call over to the operator for any questions.

[Operator]

You,

[Operator]

1 1 on your telephone and wait for your name to be announced. To withdraw your question, please press 11 again. Once again, please press 11 on your telephone and wait for your name to be announced. Thank you. We are now going to proceed with our first question.

[Operator]

The questions come from the line of Alexander Bidwell from Weber Research and Advisory. Please ask your question.

[Alexander Bidwell, Associate Analyst at Webber Research & Advisory]

Good afternoon. I appreciate the time. Could you touch on the overall commercial strategy for offtake on the Argentina projects? Is there a target mix of merchant and contracted volumes that you guys are aiming for?

[Karl Fredrik Staubo, CEO at Golar LNG]

Sure. So that work will be led by Southern Energy, where we are obviously a shareholder and will assist. The target is to have a basket offtake probably between a basket between Brent, JKM, and TTF linked and then some volume left for spot. The interesting part is that there are no LNG exports in this region of the world, and there are some high paying countries very close to Argentina that could boost earnings further. So the idea is to have a combination. Yes.

[Alexander Bidwell, Associate Analyst at Webber Research & Advisory]

Alrighty. Thank you for the color. And I guess a quick one, again, on the Argentina contracts. Is there any sort of, I guess, additional upside on that, base charter rate for, excess production similar to, the, the Gimi contract?

[Karl Fredrik Staubo, CEO at Golar LNG]

No. So they have chartered the full capacity. So the $6.85 is for full capacity. Similar to the Gimi, we only guarantee 90% of nameplate, and we capture any excess earnings above the 90% through our shareholding in Southern Energy.

[Operator]

Maybe

[Gregory Lewis, Managing Director at BTIG]

starting with potential future units. If we're thinking about ordering one by year end, when do we start thinking about ordering the long lead items for another new build? And, you know, if we order one this year, what's the delivery time line look like?

[Karl Fredrik Staubo, CEO at Golar LNG]

So for the Mark one and two, which are both based on conversions, the conversion time is approximately three years. For the Mark three, because you start from scratch, you need to add another year, so approximately four years. The reason why we're ramping up the shipyard activity at the moment is to safeguard that three year construction time. And at some point, you should expect to see long leads also being included in such preparations.

[Gregory Lewis, Managing Director at BTIG]

Got it. And then for the Southern Energy JV, just a couple of related questions. First, how do we think about the JV's breakeven price for the commodity exposure? And do you give through your ten percent stake, do you have any CapEx obligations for the onshore infrastructure they need to put together?

[Karl Fredrik Staubo, CEO at Golar LNG]

So we haven't disclosed the exact breakeven of CESA, but I think it's fair to assume that the downside participation starts at 7 and a half and the upside from eight. So within that region should be a very fair assumption. Keep in mind that both the gas sales agreements and the anticipated pipeline fee will be fixed for the twenty year term. So I don't expect significant changes to that breakeven over time. And, yes, Golar is liable for 10% of the required investments by CESA.

[Karl Fredrik Staubo, CEO at Golar LNG]

However, it's important to highlight that that does not include any of the upstream work. That's only the infrastructure required to facilitate exports. So that's mainly port port infrastructure in both of San Mateas, a relatively short pipeline connection of 19 kilometers, and the mooring system for the FLNGs where we are applicable for our parata share.

[Gregory Lewis, Managing Director at BTIG]

Thanks, Carl. I'll turn it over.

[Karl Fredrik Staubo, CEO at Golar LNG]

Thanks.

[Operator]

We are now going to proceed with our next question. And the questions come from the line of Chris Robertson from Deutsche Bank. Please ask your question.

[Chris Robertson, Analyst at Deutsche Bank]

Hey, good morning. Thank you for taking my questions. Guys, obviously, the company just made a major announcement with the FID of the Hilli and entering into a definitive agreement for the Fuji. I think Tore hit on this. But just wanted to clarify, if the share price kind of stays here at current levels, you know, is the company currently considering strategic alternatives?

[Chris Robertson, Analyst at Deutsche Bank]

And would that process be made public if that if that's the direction the the board chose to go down?

[Karl Fredrik Staubo, CEO at Golar LNG]

This is I'll kick it off from management, and then Thur can add if if he wants. But in terms of management, we are running the business to the best of our ability and trying to make the best possible decisions. It is our responsibility to also find out where the best bid for the company is. That said, our focus is on running the day to day business. And then we're obviously open for any outside investors, but we are not actively facing any such bids in terms of management.

[Karl Fredrik Staubo, CEO at Golar LNG]

Our focus is to run the business. When it comes to any strategic alternatives, that's a board matter and should be comment on by the board to the extent that they see that necessary. I don't know, Tore, if you have anything to add.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

Yeah. I I think we the board has a pretty good idea about the what the current value of our backlog is. We also have a current good idea about the future opportunities we have ahead of us. We think there is significant value here. But if the stock market doesn't appreciate that value over time, I think we need to do something.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

We are here to create value for shareholders. We are not there for running a company. So from that point of view but but I but I wouldn't judge that based on one month's trading or two months trading. I think I think we need to see a structure over time. And I think we need to see the end coming in on the contract on on mark two, which will then be in the second part of the year.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

And if you don't move the share price in that time, I think the board needs come together and discuss what to do. But but I think we we are shareholder friendly. We are big shareholders. A lot of the people in the board, and and we think like shareholders. So I think you do what is necessary.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

But but I also say that we we rejected a bit last time because we tested it was better to run the company. But and we a process like that normally starts with some the incoming letters. You don't go out and sell the company, but I think there is enough interest in the company today from people who who see value in backlog. But my my situation is just that I think the the real company value here today is not necessarily $70,000,000,000 in backlog if that's nice. It's what we can build with that basis and the people we have and the market position we have.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

But but but to answer answer very clearly, if validation stays low over time, we will do something.

[Chris Robertson, Analyst at Deutsche Bank]

Thank you, Tore. I appreciate the comments there. A little bit more mundane question here for my follow-up. Can you guys clarify around any remaining CapEx associated with Gimi that you spent during the first quarter and second quarter here ahead of COD? And do you expect, going back to a previous question, do you expect any CapEx related to CESA to be deployed this year?

[Karl Fredrik Staubo, CEO at Golar LNG]

Eduardo, do you want to cover that one?

[Eduardo Maranhão, CFO at Golar LNG]

Yeah. Sure. So when it comes to the remaining CapEx on Gimi, we don't expect any material payments in the second quarter. So I think as alluded to on the call, all revenues that we have received pre COD, they have been accounted for in our balance sheet, and this equates to around just under $200,000,000. We are nearing COD.

[Eduardo Maranhão, CFO at Golar LNG]

And once we we start operations, we will start to see contributions in our p and l from revenues under that contract.

[Chris Robertson, Analyst at Deutsche Bank]

Got it. Thank you.

[Operator]

We are now going to proceed with our next question. The questions come from the line of Frederic Tybwyd from Fernley Securities. My

[Fredrik Dybwad, Equity Research at Fearnley Securities]

question revolves around the potential additional units to be ordered in this year or potentially next year. You comment that you consider Mark one, Mark two or potentially also a Mark three. So just for me to get a feel or for us to get a feel of the differences with sizes, can you get a high level overview of the prospective suitable fields? For example, how many contract opportunities does a Mark one have compared to a Mark two? I would assume that the Mark one is much more flexible.

[Karl Fredrik Staubo, CEO at Golar LNG]

Yeah. That's a relevant question. So first and foremost, all three designs are based on a generic design. It's the same liquefaction methodology, which means that we will not tailor made for one specific field. Hence, they can all be redeployed at various different opportunities.

[Karl Fredrik Staubo, CEO at Golar LNG]

But to your point, the larger you go, the more gas reserves and and gas flow is required to fully utilize the vessel. Hence, therefore, there are by number more commercial opportunities for the smaller sizes and then somewhat fewer for the larger. However, for some of these larger opportunities, you may also need this level of size to make the development economic. So what you should expect to see is that we are right now progressing conversations or negotiations which for all three different designs. And you could see us progressing with more than one ship this year.

[Karl Fredrik Staubo, CEO at Golar LNG]

I think it's also fair to say that there are several people that we have advanced stages of commercial negotiations with that are now left without a liquefier as the Argentinian contracts took both the Hilli and the Mark two. And as such, there's no available FLNG. And and and those are are obviously the counterparts that we are concentrating on from the commercial side right now.

[Fredrik Dybwad, Equity Research at Fearnley Securities]

Thank you. And just one small follow-up on that. You have previously said that you want to just have one unit, call it, on speculative order, that is one unit without a contract. Do you have the same stance now? Or are you open to potentially ordering two new vessels without the contract as you did on the Fuji?

[Karl Fredrik Staubo, CEO at Golar LNG]

So what we've said is that as long as we have visibility for charter, we will only have one open. The way we see it now, we think it's extremely likely that the Mark two will be fixed in Argentina. And there's no coincidence that the definitive agreements on the Mark two was signed simultaneous with the final FID on the Hilli. It's economical for them to utilize both ships in the same area. There are significant operational synergies and further advantages in transporting the gas from the Vaca Muerta 2 site, which benefits from the two ships.

[Karl Fredrik Staubo, CEO at Golar LNG]

Hence, in our view, we believe we can proceed with unit number four without adding without changing our expressed strategy of maximum one open ship. And even if we plan to or could order up to two vessels this year, we will still commit to our stated strategy of maximum one open ship. That means that one of those ships would effectively be built against contract, if not both.

[Fredrik Dybwad, Equity Research at Fearnley Securities]

Perfect. Thank you so much.

[Karl Fredrik Staubo, CEO at Golar LNG]

Thank you.

[Operator]

We are now going to proceed with our next question. And the questions come from the line of Peter Hojin from ABG Sundal Collier. Please ask your question.

[Petter Haugen, Partner, Equity Research Analyst at ABG Sundal Collier]

Good afternoon, guys. A quick clarification to begin with. In terms of the CPI adjustments, I read it as if it's applicable to both, of course, the base EBITDA and to the upside of or to the upside ceiling of of $8 per MMBtu. But I also understand it to be applicable for the 7.5 and $6 per MMBtu related to the the downside potential. Is that correct?

[Karl Fredrik Staubo, CEO at Golar LNG]

I'm glad we have a clear presentation then, Petit. That's correct.

[Petter Haugen, Partner, Equity Research Analyst at ABG Sundal Collier]

Thank you so much. And if I may, in as we have the chairman on the line here, we've already touched upon this. But is it possible to say something about what the Board would now perceive to be fair valuation of the business as it both stands and knowing about the growth opportunities ahead?

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

I don't think it's I think we have, obviously, in board documents, we kind of go through evaluations in the different scenarios, but I don't think it's fair to speculate on it. The only thing I would say is, I think and that should go for anybody who can do accounting. It should be significantly higher than 37. So but I don't think we'd like to give any kind of guidance on value other than saying that that if the undervaluation we have today persist over time, we the board will be forced to to find ways to unlock that value. That could be it could be take all kind of forms.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

You can I think we have had earlier bids for part of the assets at the kind of good prices? We have so so it can be selling the company. It can be kind of growing the company with different capital structures. But but we're not gonna sit and see on an undervaluation over time. But we can sit and watch the undervaluation for a month or two or three that that we are patient enough to that.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

I think it everybody now talks about the two years we have of paying until we effectively get the cash flow turned on. But I think I've had twenty five year of pain until I'm here, so another two years doesn't take me that long, actually. And I think investors in this case should see that what we're trying to do is to build significant value over time, you know, maximize the value short term.

[Petter Haugen, Partner, Equity Research Analyst at ABG Sundal Collier]

Understood. And and that's good color. Thank you so much, Drula.

[Tor Olav Trøim, Chairman of the Board at Golar LNG]

Yeah.

[Operator]

We are now going to proceed with our next question. And the questions come from the line of Michael Webber from Webber Research. I

[Michael Webber, Managing Partner at Webber Research & Advisory]

just wanted to follow-up on Cessna and specifically the the gas that's heading to to both the Hilli and another unit. I know the Hilli's teed up to utilize latent capacity from an existing pipeline network, and then they're looking to build a dedicated pipe for the other asset. Is that gas already treated and and or does there need to be treatment built for either the hilly or subsequent assets onshore or offshore? Right?

[Karl Fredrik Staubo, CEO at Golar LNG]

That will be done as part of of onshore, but Vaca Muerta gas is extremely lean. So it's it's almost very, very little treatment needed, and the necessary treatment facility is more or less in place ex existing. So that's not an issue.

[Michael Webber, Managing Partner at Webber Research & Advisory]

So the existing treatment is already in place for for the Hilli or for is there is there enough excess treatment capacity to handle additional assets too?

[Karl Fredrik Staubo, CEO at Golar LNG]

The gas specification of the Vaca Muerte, what we're talking about here is producing lean gas. So they will obviously require upstream investment, meaning wells that need to be drilled in Vaca Muerta to increase flow. Mhmm. Extremely limited treatment that's required of that gas, and that's part of the attraction to use Vaca Muerta for exports.

[Michael Webber, Managing Partner at Webber Research & Advisory]

Okay. So specifically, the the I'm I'm thinking about the timing of any treatment capacity that needs to be built in conjunction with when those charters would start. So do you see that as a significant risk factor for the commencement of

[Karl Fredrik Staubo, CEO at Golar LNG]

those charters? The pipeline and any associated infrastructure has a construction period of significantly less than two years. Okay. We've already spent together with Tesla more than a year on all the planning, so I think we're we're very well on track to facilitate that infrastructure.

[Michael Webber, Managing Partner at Webber Research & Advisory]

Great. That's helpful, guys. Thanks for the time.

[Karl Fredrik Staubo, CEO at Golar LNG]

Thank you.

[Operator]

Thank you. In the interest of time, we have time for one last question. And the questions come from the line of Eric Bauzell from Fernley. Please ask your question.

[Analyst]

Hey, guys. Congrats on great quarter. Just quickly on the capital structure. You mentioned that you're you're engaging with rating agencies, to get the rating and that you could look at the bond financing. Should we expect a a a ratings of benchmark bonds coming out of you guys soon?

[Analyst]

And also just to to follow-up on that, you indicated an asset level financing around five times. Is that something you can look at the corporate level as well?

[Karl Fredrik Staubo, CEO at Golar LNG]

Eduardo, do you wanna start?

[Eduardo Maranhão, CFO at Golar LNG]

Yeah. Sure. So you're right. So we have started an exercise with rating agencies to pursue a bond rating. That exercise has been completed.

[Eduardo Maranhão, CFO at Golar LNG]

However, any outcome of that rating is still confidential. We could potentially be looking at transactions at the corporate level or alternatively at an asset level basis as well. So I think we're using that five times as a guidance, which takes as the same leaseback financing that we have signed for Gimi, which was done just under six times. So I think we view five times as a as a leverage ratio as a as a conservative assumption of what can be done on the back of this twenty year agreement.

[Analyst]

Great. Thanks.

[Operator]

This concludes the question and answer session. I will now hand back to Mr. Charles Stabo for closing remarks.

[Karl Fredrik Staubo, CEO at Golar LNG]

Thank you all for dialing in and listening to our Q1 presentation. Much appreciated, and we look forward to reconnect during our Q2 presentation. Thanks again, and have a great day.

[Operator]

This concludes today's conference call. Thank you all for participating. You may now disconnect your lines. Thank you, and have a great day.

Participants

Executives

• Karl Fredrik Staubo, CEO
• Morten Skjong, CTO
• Eduardo Maranhão, CFO
• Tor Olav Trøim, Chairman of the Board

Analysts

• Alexander Bidwell, Associate Analyst at Webber Research & Advisory
• Gregory Lewis, Managing Director at BTIG
• Chris Robertson, Analyst at Deutsche Bank
• Fredrik Dybwad, Equity Research at Fearnley Securities
• Petter Haugen, Partner, Equity Research Analyst at ABG Sundal Collier
• Michael Webber, Managing Partner at Webber Research & Advisory
• Analyst