LNG

Belgian shipping company Exmar, owner of the “Tango FLNG” barge last deployed in Argentina and now up for re-charter, reported annual gross cash flow from operations of US$239.9 million, including a $150M settlement fee paid by Argentine energy company YPF for the “Tango FLNG” charter cancellation.

Exmar said it was getting its finances back on track after payments from YPS and financing deals for other parts of its fleet.

Exmar, based in the port of Antwerp, said it still posted a loss of $7.8M for its operating result versus a profit of $14.5M in 2019.

“Earnings were negatively impacted by an impairment of $28.5M on older vessels,” explained Exmar.

“The year 2020 will be remembered as being dominated by the unprecedented pandemic which distorted economic activities worldwide and made big impacts on daily lives. The reality is that overall, seaborne gas markets fared relatively well,” stated Exmar.

Exmar’s FLNG vessel, built at the Chinese Wison shipyard in Nantong, China, formally started its operations at Bahia Blanca port in Argentina in mid-2019 and a 10-year charter term began in September 2019.

The Belgian company's FLNG barge has production capacity of around 500,000 tonnes per annum. 

“Since the effective termination of the contract with YPF in October 2020, marketing is in full swing and, given its status as a fully-proven facility, there is a healthy interest from the market for a ‘Tango FLNG’ redeployment,” said Exmar.

“The fact that the start of 2021 saw increased price levels of oil and gas globally will certainly benefit the opportunities for reactivation,” it stated.

The company added that the Exmar LNG carrier “Excalibur” was under a time-charter contract until early 2022.

Exmar also noted some highlights at the end of 2020 and the start of 2021, including the $40M replenishment a debt agreement with Bank of China and the refinancing of a bank facility with Nordea bank of Finland for Exmar’s liquefied petroleum gas (LPG) midsize fleet for an amount of $310M, of which $290M has been drawn.

Additionally, Exmar said that at the start of the first quarter of 2021 it signed lease financing for two Very Large Gas Carriers (VLGCs) under construction.

Exmar said its average time-charter equivalent rates for the midsize (38,115 cubic metres capacity) LPG fleet rose to $21,680 per day from $18,587 per day in 2019.

For VLGCs (83,300 cbm) it was $30,605 per day, up from $28,527 per day in the previous year.

Pressurized vessel (5,000 cbm) rates came to $7,865 versus $8,861 in 2019.

“Exmar will take delivery of two LPG-fuelled 88,000 cbm VLGC newbuildings, to be named ‘Flanders Innovation’ and ‘Flanders Pioneer’, in the second and third quarter of 2021 that will enter into a long-term time-charter to Equinor ASA (Norway),” said the company.

“These vessels were the first VLGCs ordered at the time with dual-fuel engines able to burn LPG on the main engine, substantially reducing emissions and underlining Exmar’s continued and consistent ability to innovate,” added Exmar.

Exmar, the Belgian shipping line and owner of the “Tango FLNG” hull chartered to Argentina, said the production vessel has now been fully commissioned after the loading of the first cargo.

“The performance acceptance tests have been successful, the first cargo has been offloaded and will be exported out of Argentina,” said Exmar.

“With this first shipment the start-up of the Tango FLNG is accomplished in a record time following the contract signing in November 2018 and delivery acceptance of the unit in Bahia Blanca in February 2019,” explained Exmar.

Antwerp-based Exmar said the First Argentine shipment has been possible thanks to the excellent cooperation between the teams of Argentine energy company YPF and Exmar.

Exmar stated that the first YPF LNG cargo amounted to around 25,000 cubic metres of gas from Vaca Muerta shale gas reserves in northwest Argentina and marked the entry of Argentina to the club of global LNG exporting nations.

“For Exmar, the successful performance test in Bahia Blanca confirms the technical capabilities of the ‘Tango FLNG’, the first such vessel operating in the Americas,” said Nicolas Saverys, Exmar’s Chief Executive.

“The unit is generating earnings since early May and is expected to be fully on stream after the Argentine winter season,” added the CEO.

“Exmar’s Board of Directors and Executive Committee wish to thank all employees and stakeholders in this project for the great dedication and impressive execution work over the past months,” said the Belgian company.

The “Tango FLNG” plant is chartered under a 10-year agreement from Belgian shipping company Exmar.

The vessel is the former floating liquefaction unit, “Caribbean FLNG”, constructed for a cancelled venture in the South American state of Colombia and renamed before being sent to Argentina.

YPF did not specify the destination of the first shipment, though said the sales operation was helped by the marketing arm of US LNG exporter Cheniere Energy.

Growing natural gas production from the Vaca Muerta shale play in northwest Argentina will eventually meet all of the nation’s energy requirements and leave a surplus for export.