Höegh LNG The floating LNG services provider. Höegh LNG s Capital Markets Day December Norges Rederiforbund

Transcription

1 Höegh LNG The floating LNG services provider Höegh LNG s Capital Markets Day December Norges Rederiforbund

2 Forward-looking statements This presentation contains certain forward-looking statements concerning future events and our operations, performance and financial condition. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain the words believe, anticipate, expect, estimate, project, will be, will continue, will likely result, plan, intend or words or phrases of similar meanings. These statements involve known and unknown risks and are based upon a number of assumptions and estimates that are inherently subject to significant uncertainties and contingencies, many of which are beyond our control. Actual results may differ materially from those expressed or implied by such forward-looking statements. Important factors that could cause actual results to differ materially include, but are not limited to: FSRU and LNG carrier market trends, including hire rates and factors affecting supply and demand; our anticipated growth strategies; our anticipated receipt of dividends and repayment of indebtedness from our joint ventures; the effect of the worldwide economic environment; turmoil in the global financial markets; fluctuations in currencies and interest rates; general market conditions, including fluctuations in hire rates and vessel values; changes in our operating expenses, including drydocking and insurance costs; our ability to make cash distributions from either Höegh LNG Holdings Ltd. ( HLNG ) or Höegh LNG Partners LP ( HMLP ) and the amount of any borrowings that may be necessary to make such distributions; our ability to comply with financing agreements and the expected effect of restrictions and covenants in such agreements; the future financial condition of our existing or future customers; our ability to make additional borrowings and to access public equity and debt capital markets; planned capital expenditures and availability of capital resources to fund capital expenditures; the exercise of purchase options by our customers; our ability to maintain long-term relationships with our customers; our ability to leverage the relationship between HLNG and HMLP; our reputation in the shipping industry; the ability of HMLP to purchase vessels from HLNG in the future, including the FSRU Independence and HLNG s three FSRU newbuildings; our continued ability to enter into long-term, fixed-rate charters; our ability to maximize the use of our vessels, including the redeployment or disposition of vessels no longer under long-term charters; expected pursuit of strategic opportunities, including the acquisition of vessels; our ability to compete successfully for future chartering and newbuilding opportunities; timely acceptance of our vessels by their charterers; termination dates and extensions of charters; the expected cost of, and our ability to comply with, governmental regulations and maritime self-regulatory organization standards, as well as standard regulations imposed by our charterers applicable to our business; expected demand in the LNG shipping sector in general and the demand for vessels in particular; availability of skilled labor, vessel crews and management; our incremental general and administrative expenses as a publicly traded limited partnership and our fees and expenses payable under the ship management agreements, the technical information and services agreement and the Administrative Services Agreements; the anticipated taxation of Höegh LNG Partners LP and distributions to our unitholders; estimated future maintenance and replacement capital expenditures; our ability to retain key employees; customers increasing emphasis on environmental and safety concerns; potential liability from any pending or future litigation; potential disruption of shipping routes due to accidents, political events, piracy or acts by terrorists; future sales of our common units in the public market; our business strategy and other plans and objectives for future operations; and other factors listed from time to time in the reports and other documents that we file with the Oslo Børs or the U.S, Securities and Exchange Commission, including our Registration Statement on Form F-1 for the initial public offering of HMLP, which was declared effective on August 7, All forward-looking statements included in this presentation are made only as of the date hereof. We do not intend to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in our expectations with respect thereto or any change in events, conditions or circumstances on which any such statement is based. 2

3 Introduction Preparing for next growth phase Presented by Sveinung J.S. Støhle CEO & President 3

4 Agenda Time Subject Title Name 12:45-13:00 Introduction CEO & President Sveinung J.S. Støhle 13:00-13:30 Preparing for next growth phase CEO & President Sveinung J.S. Støhle 13:30-14:00 Funding future growth and dividend policy CFO Steffen Føreid 14:00-14:15 Coffee break 14:15-14:45 Höegh LNG Partners LP CEO HMLP Richard Tyrrell 14:45-15:15 FSRU / LNGC strategy and market update CCO Ragnar Wisløff 15:15-15:30 Coffee break 15:30-16:00 FSRU innovation, project execution and operation CTO Vegard Hellekleiv 16:00-16:30 FLNG strategy CDO Øivin Iversen 16:30-16:50 Summary and final Q&A CEO & President Sveinung J.S. Støhle 16:50 Drinks and snacks There will be 5-10 minutes for questions from the audience after each presentation 4

5 Why invest in Höegh LNG? Proven track record of shareholder value creation and operational excellence Significant opportunity for accretive growth backed by strong industry fundamentals and strong market position Plan to double FSRU fleet + 1 FLNG by 2019 HMLP supports additional accretive investments through drop-downs 4 Leader in the high return FSRU segment our #1 priority segment 5 Dividend paying from first quarter 2015 HMLP supports cash flow via distribution and IDRs 5

6 HLNG has successfully executed its IPO strategy What we said What we did FSRU FSRU priority #1 Secured long term contract for 4 FSRUs in 3 years Ordered 7th FSRU FLNG Attractive long-term FLNG opportunities Developed barge design, secured exclusivity for 2 projects LNGC LNGC market will be oversupplied No LNGCs ordered, market oversupplied MLP Considered part of our long term strategy Launched it! 6

7 Global presence Operated LNG carriers since 1973 and FSRUs since 2009 Headquartered in Oslo Presence in London, Miami, Klaipeda, Jakarta and Singapore Manning offices in Manila, Rijeka and Riga Site office in Ulsan Head office Local office Planned 7

8 Our objective is to achieve best risk-adjusted return by allocating capital in the optimal order of priority 1 FSRU 2 FLNG 3 LNG carriers Strategic rationale + Barriers to entry + High risk adjusted return + Long-term contracts + Strong growth prospects + High barriers to entry + High returns + Long-term contracts Technical risk and capital intensive + May be accretive for MLP Low barriers to entry Competitive Industrial returns Business model Order before contract Modern fleet, latest technology In-house technical resources Long term contracts Order after contract award Low cost barge design Experienced EPCIC contractor Strong contract counterpart Order only after contract award In- house technical resources Newbuilding only No spot exposure Growth strategy 1-2 per year Double FSRU fleet by 2019 through firm+options strategy 1-2 by per year (if accretive for HMLP) Capital to be raised by HMLP 8

9 and we have initiated the second stage of our growth plan strategy to double FSRU fleet by 2019 Strong market fundamentals for FSRUs and high barriers to entry target IRRtot of 11-12% On 6 November 2014, HLNG placed an order for an additional FSRU at Hyundai, taking its fleet to 7 large newbuilt FSRUs, the most modern fleet on the water, average age of 1 year HN2552 has scheduled delivery first quarter 2017, full trading capability and increased regas capacity compared to existing FSRU fleet Negotiating further FSRU orders with yards combination of firm orders and rolling options HLNG s FSRU success provides leverage in negotiations and results in competitive prices and yard slots FSRU fleet growth > 9

10 Recent company highlights EGAS contract Colombia contract Successful listing of MLP HN2552 Government sponsored project to cover the country s gas deficit Start-up and technical specification fits well with Höegh Gallant MLP candidate with 5 year contract Government sponsored project to ensure energy security Established natural gas and electricity market MLP candidate with 20 years contract Best priced maritime MLP IPO ever Funding vehicle for parent s growth in place Parent provides the MLP with a visible pipeline of dropdown candidates Launch of FSRU expansion phase #2 Competitive price offers confirms HLNG s leading position in the FSRU segment Increased regasification capacity, storage capacity and speed Dividend policy in place Policy: Stability, predictability and growth over time Dividend payments from 1 st quarter

11 Recent market developments are positive for HLNG s growth plans How is HLNG affected? Lower crude prices will lead to lower LNG prices Oversupplied world oil market lower oil prices LNG prices in Asia and Europe indexed to oil price lower LNG prices US natural gas prices no direct link to oil prices Lower LNG prices will lead to higher LNG demand FSRU: Increased demand for HLNG s services due to new entrants at lower LNG prices FLNG: New FLNG capacity needs to adjust to lower LNG prices Increasing construction cost on land-based terminals Construction cost on landbased liquefaction terminals increasing, up to 2000+USD/ton Engineering and construction capacity scarce high EPCIC cost and margins Lower LNG prices - expensive LNG export terminals will not be built or postponed Creates opportunities for cost competitive, time and flexible LNG production solutions; FLNG 11

12 Funding future growth and dividend policy Presented by Steffen Føreid CFO 12

13 Höegh LNG has created significant shareholder value since IPO evidenced by share price development Index NOK and valuation IPO issue price Current price NAV/share (1) HLNG OSEBX (1) Range of 6 analyst valuations 13

14 Proven capital market access with USD 1.6 billion raised since 2011 Equity Secured Bank debt Unsecured Bond debt USD 130 million IPO HLNG USD 250 million Independence USD 130 million General corporate purposes Transactions USD 200 million Follow-on HLNG USD 310 million Lampung FSRU/Mooring USD 220 million IPO HMLP USD 412 million Höegh Gallant and HN2552 Total amount raised USD 550 million USD 972 million USD 130 million Relationships 14

15 Secured and diversified growth ahead Potential development T/C income USD million FLNG (assumed ordered) FSRU#8-13 (assumed ordered) FSRU#7 FSRU# Pre-IPO fleet CAGR 20% 400 One FLNG (1mtpa) could add USD million to income Growing by one FSRU per year adds another USD 300 million to income by Contracted income USD 300 million p.a. 15 Chart assumptions: FSRUs (#7-13) generating USD 40 million of EBITDA each FLNG with 1.0 million tons per year production capacity

16 HMLP the primary vehichle for funding growth $ $ $ Newbuilding orders HLNG Securing HLNG employment Intermediate trading Lump sum Drop down proceeds HLNG Quarterly Dividends Quarterly Incentive Distribution Rights Acquires contracted asset Drop-down of assets HMLP Operation HMLP of assets Re-employment of assets HMLP Capital market transaction 16

17 MLP structure gives lower cost of capital and increased investment capacity EV/EBITDA mulitples 3 1 Ability to fund growth at low cost 2 Each FSRU drop down 2 provides investment capacity for two new FSRUs ~7.5x ~7x Newbuilding multiple (1) HLNG trading multiple (2) ~9-11x ~13x Drop-down multiple (3) 1 HMLP trading multiple (3) 3 Accretive growth of HMLP transforms into higher distribution per unit 17 (1) Delivered cost USD 300 million; EBITDA USD 40 million p.a. (2) HLNG market cap 8 December 2014, NIBD and remaing capex 30 September 2014, analysts estimate 2016 EBITDA, FSRU#7 added (3) EV/adjusted 2015 EBITDA

18 Incentive Distribution Rights a key value driver over time Potential development in annual distribution to HLNG (1) USD 100 million Increasing share of distribution payable to HLNG as holder of IDRs In addition HLNG receives dividend on units Total distribution to HLNG could exceed USD 100 million p.a Dividend distribution IDR distribution 18 (1) Assuming HMLP comprises 13 FSRUs and 1 FLNG and 6.7% trading yield of HMLP

19 Visible pipeline of drop down candidates 19

20 Equity portion for two FSRU newbuildings at hand Capital structure 3Q2014 (USD million) Balance sheet 31 September 2014 Bond debt; 116 Bank debt; 418 Other; 97 Adj. equity; 633 Adjusted equity ratio 50% ( 1) Cash & cash equivalents USD 286 m Net interest bearing debt USD 248 m Future funding Pre and post delivery bank financing Debt follows asset into MLP Debt / EBITDA of approximately 5.0x HLNG and HMLP likely to be bond issuers 20 (1) Balance sheet as of 30. September Joint ventures accounted for according to the equity method. Equity adjusted for MTM of interest rate swaps

21 HLNG plans to pay dividends from first quarter 2015 Dividend policy Stability Predictability Grow dividends over time Guiding Pay out total distributions received from HMLP Dividend payments from 1 st quarter 2015 Foreseeable amounts 2015: Up to USD 0,40 per share 2016: Up to USD 0,50 per share 2017: Up to USD 0,60 per share 2018+: Further increase Amounts and timing subject to upcoming bondholder meeting 21

22 Summary Significant shareholder value created since IPO Proven capital market access HMLP facilitating growth Strong balance sheet Dividend policy in place 22

23 Höegh LNG Partners LP Presented by Richard Tyrrell CEO HMLP 23

24 History of MLPs MLPs match de-risked cash-flow generating assets with yield-seeking investors Maritime MLPs are not generally a tax arbitrage it is contracted vessels that make them attractive In total, there are more than 100 MLPs with a combined market cap exceeding USD 400 billion 2001 First MLP (now a corporation) 2004 First contemporary maritime MLP K-1 for tax purposes 2014 At 6.75%, the lowest yielding maritime MLP at IPO 1099 for tax purposes making it easier for institutional investors to hold 24

25 Why invest in Höegh LNG Partners? Fixed rate revenues with no commodity exposure Modern fleet on long-term charters Creditworthy utility counterparties High proportion of opex on pass-through Long-term fixed rate debt Visible dropdown pipeline of contracted assets and growth prospects for LNG infrastructure 25

26 HMLP fits well within the HLNG platform HMLP has an option on all HLNG assets with contracts of five years or longer HLNG benefits from dropdowns funding its anticipated growth; HMLP benefits from the parent s reputation, technical expertise and pipeline 26 (1) Economic interest comprised of 8% common units and 50% subordinated units (2) Incentive Distribution Rights

27 HMLP is the best priced maritime MLP IPO ever Issuer Offering Size Price Proceeds Höegh LNG Partners LP (NYSE:HMLP) 11,040,000 Common units after exercise of over-allotment $20.00 (mid-point of range) $220.8 million (gross) / $203.5 million (net) Implied Yield 6.75% One-on-One Hit Rate 69% Institutional Coverage 6.6x # Institutions Allocated 129 Price to First Day Close +11.3% 27

28 ... and has a high quality investor base HMLP has attracted some of the largest and most influential investors The retail allocation was relatively small at IPO but this will grow with follow-ons Retail 15 % Allocation at IPO DUP 4 % (1) Inst. 81 % Top disclosed HMLP investors Goldman Sachs Asset Mgmt 18.02% Neuberger & Berman 11.41% Oceanic 8.00% Kayne Anderson 6.42% Clearbridge 5.64% Eagle Global 4.60% Park West 3.42% Whetstone Capital 3.28% Cohen & Steers 2.30% Wexford Capital 1.81% Fidelity 1.73% Source: Company data Source: BLOOMBERG filing dates through September 30, (1) Directed Unit Program that enabled management and Board members of HMLP and HLNG to invest in IPO

29 Unit Price rebased to HLNG Thousands HMLP performance since IPO HMLP s common units closed at USD on December 5, versus an IPO price of USD 20 Correlation with oil price despite no direct link to HMLP s business; trading characterized by thin volumes aug sep okt nov Volume HMLP US Equity Av. Driller MLPs(1) Av. Maritime MLPs(2) 29 (1) Average of SDLP, RIGP (2) Average of GLOP, GLNG, DLNG, TGP, KNOP

30 Valuation versus peers The timing of the HMLP IPO coincided with a period of strong markets (low yield) Recent volatility has made the units look cheap especially if the fully funded first drop-down is factored in (1) Peer group includes GLOP, GLNG, DLNG, TGP, KNOP 30 Source: BLOOMBERG

31 Strategic plan HMLP has a robust pipeline of drop-downs and HLNG s ambitious plans will see this grow HN2551 is scheduled to be operational and eligible for HMLP in mid-2016; the HHI option was exercised and HN2552 is scheduled for 1Q17 delivery 31

32 Developing portfolio of assets Unit Type Ownership Built Charterer Current HMLP Fleet GDF Suez Neptune FSRU 50% 2009 GDF Suez GDF Suez Cape Ann FSRU 50% 2010 GDF Suez (1) PGN FSRU Lampung FSRU 100% 2014 PGN Dropdown Candidates at HLNG Independence FSRU 2014 Klaipedos Nafta Höegh Gallant FSRU 2014 EGAS HN2551 FSRU 2015E SPEC HN2552 FSRU 2017E Open Firm contract Option TBD Modern, technically advanced fleet Long-term charters (av. 17 years on current fleet) (2) Leading utility customers Fixed contracts with substantial opex passthrough Contracted drop-down candidates 32 (1) Economic interest; ownership interest 49% (2) Current fleet as of September 30, 2014

33 Summary Completed the successful IPO of HMLP Contracts and vessels that are amongst the best suited in the maritime segment for the asset class First dropdown (Independence Part 1) funded by IPO proceeds; no followon required Robust pipeline of accretive dropdown candidates Parent with ambitious growth plans 33

34 FSRU / LNGC strategy and market update Presented by Ragnar Wisløff CCO 34

35 HLNG will continue to strengthen its position as the leading player in the FSRU space Business model Order before contract Able to bid on fast track / high return projects Modern fleet and latest technology Lower overall cost for the client In-house technical and operational experience Optimize technical design to clients needs Long-term contracts Lower residual risk 35

36 HLNG has secured 4 long term FSRU contracts in 3 years PGN FSRU Lampung Ordered June 2011 and secured 20 years contract with PGN in March 2012 Feeds PGN s pipeline system to serve customers in key industrial area of Java Independence Ordered June 2011 and secured 10 years contract with Klaipedos Nafta in March 2012 Will provide energy independence for Lithuania Höegh Gallant Ordered February 2012 and secured 5 years contract with Egas in November 2014 Will help cover gas deficit in Egypt HN2551 Ordered October 2012 and secured 20 years contract with SPEC in November 2014 Ensure redundancy in power generation in Colombia 36

37 Recent project awards Colombia/SPEC Strategic project for Colombia - energy security during drought Project start-up mid years - break options at year 5,10 & 15 EBITDA of USD million Strategic project for Egypt - cover gas deficit Start-up early April years contract Egypt/Egas EBITDA of approx. USD 40 million 37

38 New producers and buyers will enter the market over the next five years, in particular US exports and buyers in the middle east and South America Production Demand Production volumes only include projects that has taken FID in addition, there is approximately 150 MTPA of capacity on projects that has not taken FID, including 40 MTPA from 4-5 projects in the U.S. where FID is expected within 12 months Expectations of strong growth in demand in China, India, South America (other) and Europa - demand in Japan/Korea/Taiwan to remain the same Source: Shell 38

39 MTPA Lower LNG prices will lead to higher demand for LNG higher demand for FSRUs In India demand can potentially increase by 300% USD/MMBtu 39 Source: Petronet LNG

40 Elements in robust projects Governmental backing/ownership Financial strength Main drivers political Low permitting risk Key FSRU project drivers Need to replace expensive liquid fuels with a lower cost natural gas Need for supply diversification / energy independence Limited access to pipeline gas 40

41 Several projects available for HLNG s planned FSRUs Uncommitted FSRU deliveries BW Gas Golar LNG Exmar BW Gas FSRU#7 Tentative delivery schedule for 5 additional HLNG FSRUs Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Expected project start-ups Asia Asia Africa Asia Europe Middle Africa South America East Asia Asia South America 41

42 What makes HLNG different from its competitors? Höegh LNG Excelerate Golar LNG BW Gas MOL Exmar Order before contract? i xi we will not order more FSRUs i xi xi Newbuilt and latest technology i First generation FSRUs Conversions and Newbuilt i i First generation and Barge Integrated projects i i i xi xi i Regas experience i i i xi xi i Fleet of which 4 partly owned by Exmar on order 1 on order Ownership in barge on order 42

43 HLNG is considering LNGC deals that will have an accretive impact on shareholders returns in HMLP Business model No speculative orders and no spot exposure Newbuilding Latest technology Market update Short term market is long and will remain so at least until 2016 Little correlation between short term market and medium/long term market Substantial demand for new tonnage with the right specifications in the next 5 years due to new export volumes from US and Australia New buildings will replace existing tonnage due to improved fuel efficiency, size and boil off Competition and low barriers to entry 43

44 Summary HLNG s FSRU focus has been a great success 6 modern FSRUs on long term contracts Positive market prospects; increasing demand for FSRUs and entry barriers continue to be high HLNG will continue to strengthen its position as the leading player in the FSRU space HLNG is considering LNGC deals that will have an accretive impact on shareholders returns in HMLP 44

45 FSRU innovation, project execution and operation Presented by Vegard Hellekleiv CTO 45

46 Experienced technical team - taken delivery of 3 FSRUs in 7 months Committed and high quality workforce both onshore and onboard the vessels Prepared for growth - took delivery of 3 FSRUs in in the technical team onshore 500 seagoing personnel High retention rate First class operational performance Level Retention Rate (%) Onboard 97.0 Onshore

47 Executing USD 1.2 billion construction program Contract signed in June vessels delivered in 2014 and one more coming end of March 2015 Approximately 6 million man-hours for design and construction Supervision team of 30 people Zero LTIs to date 47

48 HLNG has since 2001 been part of driving the technical FSRU development.. Pioneered floating regasification with technical design in 2001 Ordered the first FSRU in 2006 Leading in-house technical expertise provide designs tailor-made for each customer Regas system designed for flexible operations and boil off recovery 48

49 and remains at the forefront of trends in the maket FSRU trends How is HLNG responding? Start-up is not back-to-back Clients want flexibility to trade as LNGC in low demand seasons Full LNGC trading capability Seasonal demand Energy security Higher regas capacity, low boil off and boil off compressor Average size of global LNGC fleet is increasing Increased storage capacity 49

50 From supervision to managing integrated projects Fully integrated PGN Indonesia Interfaced Klaipedos Nafta Lithuania Project scope FSRU + Mooring + Pipelines FSRU Construction sites 4 1 New technology / operations No dry docking + gas offloading through tower yoke None Local requirements High Moderate Total delivered cost USD 500+ million (1) USD 300+ million Ability to deliver complex project solutions make HLNG a preferred partner (1) Includes mooring and pipeline 50

51 Summary 40 years of LNG experience and 13 years of regas experience Able to handle growth - took delivery of 3 FSRUs in 2014 Market leading technical competence to optimise designs for the clients Continously working to develop competitive solutions 51

52 FLNG strategy Presented by Øivin Iversen CDO 52

53 FLNG - Facilitating export of pipeline specification gas Barge based FLNG solution Less capital intensive Quicker to build Flexible U.S. shale gas revolution 53

54 HLNG is only focusing on its barge-based FLNG design Business model Order after contract award, for unit 1 Reduce risk technically complex and higher capital requirements Newbuilt low cost barge nearshore and pipeline specification gas Very cost competitive with landbased terminals Sign EPCIC contract with one of the big 5 providers Strong contract counterpart and tolling model ($/MMBtu) Reduced technical risk and risk of cost overrun Better financing and no exposure to volume and LNG price 54

55 FLNG is a capital efficient solution HLNG barge based FLNG 55 Source: IHS Cera

56 Barge FLNG significantly reduced technical scope Nearshore FLNG barge Offshore FLNG Technical specifications Liquefaction: Water- and CO2 removal: Full pre-treatment Included Included but limited Not included Leads to lower technical risk and lower cost, also USD/ton Included Included Included Liquefaction volume: Harsh environment: < 2.5 mmtpa No > 2.5 mmtpa Yes Other Reservoir risk: Financing and insurance: Investment level: No Less complex, marine scheme 1-2 billion USD Yes Complex, industrial scheme 4-7 billion USD Cost per ton: USD/ton USD/ton 56

57 HLNG barge design near-shore 1 2 MTPA - technical solution 1 2 FLNG: MTPA LNG production Hull x m Internal buffer storage: m 3 LNG Classed as Offshore Installation Jetty mooring FSO: 1 Main LNG storage in FSO FSO is modified LNGC Typically m3 Side-by side LNG offloading to LNGC LNGC: For transportation to market Typical m3 57

58 HLNG FLNG tolling model HLNG is involved in these activities: Pipeline Gas Supply. Infrastructure (Pipe, spur & jetty) LNG Storage FSO LNG Tolling Co. Liquefaction services Capacity Holder EPCIC contractor FLNG SPV - LNG Production LNG Buyer FOB or CIF 58

59 Limited competition Höegh LNG Exmar Golar LNG Excelerate Speculative order Not for the first unit Under construction and with client Yes Not for their first unit Design Newbuilt barge + FSO mtpa Newbuilt barge + FSO mtpa Conversion of old LNGC mtpa Newbuilt barge and offshore mtpa Execution model Single EPCIC contractor Wison shipyard subcontract B&V Conversion at Keppel subcontract B&V Single EPCIC contractor, SHI Engineering In-house competence In-house competence In-house competence In-house competence 59

60 Höegh LNG s FLNG market focus FLNG Projects under construction Main sponsor Country Technical solution Shell Australia Offshore FLNG Petronas Malaysia Offshore FLNG Petronas Malaysia Offshore FLNG Exmar Colombia Barge FLNG Golar N/A LNGC conversion Under construction/awarded Pre-FEED/FEED Potential Barge FLNG areas Main focus North America and West-Africa 3 projects in North America 1-2 projects in West Africa 60

61 Status on HLNG s North American FLNG project Preferred provider and exclusive agreement with project owner Have secured access to pipeline capacity and pipeline gas Exclusive access to site EPCIC contractor selected Cost, schedule and permitting basis defined Shortlisted 5 potential capacity offtakers Main outstanding issues; Commitment from capacity holder (s) Due to lower energy prices potential capacity holders need more time before making commitments Will continue to negotiate Tolling heads of agreement with shortlisted companies 61

62 Status on key opportunities Sponsor Location Initial Size (MTPA) Status Financial North America 1.8 Existing development agreement Financial North America 2 x 2 Signed JDA for development phases HLNG North America Developing the business case Industrial Africa Completed feasibility study. Client assessing business case Industrial North America 2 x 2 Client in process of project due diligence 62

63 Summary HLNG aims to replicate the success it has had in the FSRU segment in the FLNG segment, except will not order on speculation FLNG projects can deliver LNG to Asian markets at a lower CIF price than land based terminals FLNG Liquefaction cost USD/mmBtu (Capex) depending on specification FLNG development schedule significantly shorter than onshore developments Execution model with single Main Contractor significantly reduces the project risk for HLNG 63

64 Closing remarks Presented by Sveinung J.S. Støhle CEO & President 64

65 HLNG s Strategy proven success have successfully positioned company as the leading provider of FSRU s in the market New LNG volumes and lower LNG prices ensures continued demand for FSRUs The MLP platform enables growth and dividend without diluting shareholders increasing value for shareholders HLNG will continue with its proven strategy - stronger platform allows more aggresive growth 65