LNG

May 16 (LNGJ) - Flex LNG, the Norwegian shipping company with a fleet of 13 vessels and several chartered to the largest US exporter Cheniere Energy, reported a fall in first-quarter profits despite a rise in operating revenues. The average time charter equivalent rate declined in the quarter to $80,175 per day compared with $81,699 per day for the fourth quarter of 2022.

   Flex reported vessel operating revenues in the first quarter of $92.47 million compared with $74.57M in the same three months of 2022. Net income dropped to $16.53M from $55.76M in the prior-year quarter. “As we completed the balance sheet optimization program during the first quarter, we had some additional financing costs in our accounts for the first quarter,” explained Øystein M. Kalleklev, Chief Executive of Flex LNG Management AS. “However, we have now put in place new attractive long-term financing for all our 13 ships, boosting our cash balance to $475M at quarter-end, or about $9 per share,” added Kalleklev.

Flex LNG, the Norwegian shipping company with a fleet of 13 carriers, said that Cheniere Marketing, a unit of the operator of the Sabine Pass and Corpus Christi export plants on the US Gulf Coast, has declared its option to employ a fifth LNG carrier under existing time charter agreements.

Cheniere and Flex LNG have also agreed that the 174,100 cubic metres capacity “Flex Volunteer” will be the fourth ship under the agreement and that this vessel will be delivered to Cheniere in mid-April 2022.

The delivery is ahead of the original schedule of the third quarter of 2022.

“The ‘Flex Volunteer’ charter with for a duration of 3.5 years has therefore been extended by about 2.5 months to facilitate early delivery of the ship to Cheniere,” said Flex LNG.

“The ‘Flex Aurora’ will be the fifth ship to be delivered to Cheniere, and she will commence her 3.5-year time charter during the third quarter of 2022 according to the original agreement,” added the company.

The fleet owner, which is listed on the New York Stock Exchange and the Oslo Børs in Norway and headquartered in Hamilton, Bermuda, noted that Cheniere took delivery  in 2021 of the “Flex Vigilant”, the “Flex Endeavour” and the “Flex Ranger”.

These ships were supplied under time charters with a minimum duration of between 3 and 3.8 years.

All existing Flex LNG ships are large LNG carriers with a cargo capacity of between 173,400 to 174,000 cubic metres and are fitted with efficient dual-fuel, two-stroke propulsion (ME-GI/XDF).

“This makes the ships particularly ideal for large parcel, long haul transportation with the industry's lowest carbon footprint and unit transportation cost,” said Flex LNG.

The company added that the time charter party agreements remained subject to certain closing conditions in connection with the delivery and acceptance of the LNG carriers to Cheniere.

Despite newbuild deliveries at an all-time high and a closed West-East arbitrage window, spot market rates are presently at an all-time high and there is optimism in the industry, according to the small Norwegian fleet owner Awilco.

Hoegh LNG, one of the main LNG project companies with a growing fleet of floating storage and regasification units, has overhauled the management of its group and its US-listed affiliate as part of long-term strategy development.

Flex LNG, the small Norwegian fleet operator with ambitions, said it had taken delivery of a new vessel, the “Flex Endeavour”, from a South Korean shipyard for charter to German utility and energy company Uniper and a second ship will be handed over to Flex on January 11.