Golar Secures FLNG Charter Deal for Argentina’s LNG Scheme

(Credit: Kongsberg Maritime)

Southern Energy S.A. (SESA), a company formed to enable LNG exports from Argentina, has reached final investment decision (FID) for the charter of 3.5MTPA MK II floating LNG (FLNG) from Golar LNG.

The key commercial terms for the 20-year charter agreement include net charter hire to Golar of $400 million per year, plus a commodity linked tariff component of 25% of FOB prices in excess of $8/mmbtu.

The FLNG, currently under conversion in China, will sail to Argentina following her redelivery, with contract start-up expected during 2028.

The MKII FLNG will be moored in the San Matías Gulf near the FLNG Hilli, which is expected to start its 20-year charter with SESA during 2027.

Combined, the two units have a nameplate capacity of 5.95MTPA, and the project expects to benefit from significant operational efficiencies and synergies from two FLNGs in the same area.

SESA is a company formed to enable LNG exports from Argentina. SESA is owned by a consortium of leading Argentinian gas producers including Pan American Energy (30%), YPF (25%), Pampa Energia (20%) and Harbour Energy (15%), as well as Golar (10%).

The MKII FLNG project remains subject to regulatory conditions precedent and satisfaction of other customary closing conditions which are progressing according to schedule and expected within 2025.

“Today’s FID marks another milestone for SESA in establishing Argentina as an attractive LNG exporter and building on Golar’s position as the market leading FLNG service provider.

“FID solidifies $8 billion of net earnings visibility over 20 years to Golar, with attractive upside potential in the FLNG commodity tariff component and through our shareholding in SESA. We look forward to continuing to develop the SESA partnership into a leading LNG exporter in South America,” said Karl Fredrik Staubo, Golar’s Chief Executive Officer.