Höegh LNG Holdings Ltd. (“Höegh LNG”) and Egypt Natural Gas Holdings Company (“Egas”) have agreed to amend the Höegh Gallant time charter.
Under the amended contract, the Höegh Gallant will be chartered as an LNG carrier to a third party, and Egas will compensate for the rate difference between the original FSRU contract and the new LNG carrier time charter.
The amended contract is expected to become effective in October 2018 and will run to April 2020, the termination date of the original five-year FSRU contract.
As part of the original FSRU contract with Egas, Höegh LNG has certain equipment installed on the jetty in Ain Sokhna, Egypt.
The book value of this equipment was approximately USD 9 million as of 30 June 2018, and since the market value and alternative use of such equipment is unclear, Höegh LNG expects to record an impairment for a corresponding amount for the third quarter of 2018.
Sveinung J.S. Støhle, President and CEO of Höegh LNG, comments: “We are proud to have provided FSRU services to Egas since 2015, during a period in which Höegh Gallant’s regasification capacity has been fully utilized, contributing strongly to balancing supply with demand in the Egyptian natural gas market. Under this amended contract we maintain our highly valued relationship with Egas, which we hope to further expand in the future as Egypt emerges as a regional energy hub.”