[Argentine] FLNG Hilli

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Golar LNG signs agreement for 20-year FLNG deployment in Argentina

5 July 2024

Golar LNG Ltd. (“Golar”) has entered into definitive agreements with Pan American Energy (“PAE”) for a 20-year deployment of a Floating Liquefied Natural Gas (“FLNG”) vessel in Argentina. The FLNG project will monetize Argentine gas, tapping into the vast resources from the Vaca Muerta shale formation in the Neuquina Basin, the world's second-largest shale gas resources. The project is expected to start LNG exports within 2027, establishing Argentina as an LNG exporter.

This strategic venture is built on a robust commercial foundation, featuring: (i) a Gas Sales Agreement from PAE for the supply of gas; and (ii) an FLNG charter agreement with Golar which includes a base tariff and commodity exposure to LNG sales prices.

The project aims to utilize Golar’s FLNG Hilli, with a nameplate capacity of 2.45 million tons per annum (“mtpa”), providing an equivalent net tariff of US$2.6/mmBtu (based on 90% capacity utilization) with an additional commodity-linked pricing element. Golar has flexibility to consider a swap alternative for another suitable Golar FLNG unit.

As part of the agreements, Golar will hold a 10% stake in Southern Energy S.A., a dedicated joint venture with PAE, responsible for the purchase of domestic natural gas, operations, and sale and marketing of LNG volumes from Argentina.

This initiative is envisaged to be the first phase of a potential multi-vessel project and it is anticipated that other large natural gas producers in Argentina will join.

Golar’s CEO, Mr. Karl Fredrik Staubo said “We are excited to enter a partnership with Pan American Energy, one of the leading energy companies in Latin America. The project will provide an international outlet for Argentina’s vast and attractive natural gas reserves, creating value to Argentina and its gas stakeholders. The project expands Golar’s global footprint, with further growth potential.”

The agreements are subject to sign-off of customary conditions.

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Golar entered into 20-year agreements for 5.95mtpa nameplate capacity in Argentina – one of the world’s largest FLNG development projects.

2 May 2025

Golar LNG Limited (“GLNG”, “Golar” or “the Company”) is pleased to announce the Final Investment Decision (“FID”) and fulfilment of all conditions precedent for the 20-year re-deployment charter of the FLNG Hilli Episeyo (“FLNG Hilli” or “Hilli”), first announced on July 5, 2024. The vessel will be chartered to Southern Energy S.A. (“SESA”), offshore Argentina. In addition, Golar and SESA have signed definitive agreements for a 20-year charter for the MKII FLNG, currently under conversion at CIMC Raffles shipyard in Yantai, China. The MKII FLNG charter remains subject to FID and the same regulatory approvals as granted to the FLNG Hilli project, expected within 2025.

Key commercial terms for the respective 20-year charter agreements include:

• FLNG Hilli (nameplate capacity of 2.45 MTPA): Expected contract start-up in 2027, net charter hire to Golar of US$ 285 million per year, plus a commodity linked tariff component of 25% of Free on Board (“FOB”) prices in excess of US$ 8/mmbtu.

• MKII FLNG (nameplate capacity of 3.5 MTPA): Expected contract start-up in 2028, net charter hire to Golar of US$ 400 million per year, plus a commodity linked tariff component of 25% of FOB prices in excess of US$ 8/mmbtu.

The two FLNG agreements are expected to add US$ 13.7 billion in earnings backlog to Golar over 20 years, before adjustments (based on US-CPI) to the charter hire and before commodity linked tariff upside. For every US$ 1/mmbtu above the US$ 8/mmbtu, the total upside for Golar will be approximately US$ 100 million when both FLNGs are in operation. Subject to a 3-year notice and payment of a fee, SESA may reduce the term of the agreement to 12 years for the FLNG Hilli and to 15 years for the MKII FLNG.

The commodity linked tariff component is upside oriented. Golar will make 25% of realized FOB prices above a threshold of US$ 8/mmbtu, with no cap to the upside for gas prices. Golar has also agreed to a mechanism where the charter hire can be partially reduced for FOB prices below US$ 7.5/mmbtu down to a floor of US$ 6/mmbtu. Under this mechanism, the maximum accumulated discount over the life of both contracts has a cap of US$ 210 million, and any outstanding discounted charter hire amounts will be repaid through an additional upside sharing if FOB prices return to levels above US$ 7.5/mmbtu. Golar is not exposed to further downside in the commodity linked FLNG charter mechanism.

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 gas producers have committed to supply their pro-rata share of natural gas to the FLNGs under Gas Sales Agreements (“GSA”) at a fixed price per mmbtu before adjustments (based on US-CPI). Golar’s 10% shareholding in SESA provides additional commodity exposure.

The project has received the full support of the National and Provincial Governments in Argentina that granted all necessary approvals including (i) the first ever unrestricted 30-year LNG export authorization in Argentina; (ii) qualification for the Incentive Regime for Large Investments (“RIGI”); and (iii) provincial approval by the province of Río Negro for the offshore and onshore Environmental Impact Assessments for FLNG Hilli.

The FLNGs will be located in close proximity of each other, offshore in the Gulf of San Matias Gulf in the province of Rio Negro, Argentina. The vessels will monetize gas from the Vaca Muerta formation, the world’s second largest shale gas resource, located onshore in the province of Neuquen, Argentina. FLNG Hilli will initially utilize spare volumes from the existing pipeline network. SESA intends to facilitate for a dedicated pipeline to be constructed from Vaca Muerta to the Gulf of San Matias to serve gas supply to the FLNGs. The project expects to benefit from significant operational efficiencies and synergies from two FLNGs in the same area.

Golar’s CEO, Karl Fredrik Staubo commented: “Golar is excited to partner with the leading gas producers in Argentina in establishing the country as an LNG exporter. The vast resources of the Vaca Muerta formation will provide the LNG market with a reliable long-term source of attractive LNG supplies, and a significant contribution to Argentina. For Golar, the project adds robust earnings backlog, attractive commodity upside potential in the FLNG tariff and strong partner alignment through our shareholding in SESA.”

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Seatrium Secures Contract to Upgrade FLNG Vessel for Golar

Singapore, 27 August 2025 – Seatrium Limited (Seatrium, or the Group) is pleased to announce that it has secured a contract from Golar Hilli Corporation (Golar), a subsidiary of Golar LNG Ltd, to perform the upgrading of FLNG Hilli Episeyo.

Mr Marlin Khiew, Executive Vice President, Energy (Americas), Seatrium said, "We are honoured to be entrusted once again by Golar with this FLNG upgrading contract. FLNG Hilli Episeyo is a testament to the strong track record of the projects we have delivered to Golar over the years and reflects their confidence in Seatrium as a partner in the development, conversion and upgrading of high-quality, sustainable, and robust production units.”

Scheduled to enter the yard in the third quarter of 2026, the project involves technical modifications for FLNG Hilli Episeyo’s redeployment. The scope of work includes engineering and procurement of long-lead items, repair and life extension and winterisation of the vessel, as well
as the installation of a new soft-yoke mooring system.

When completed, FLNG Hilli Episeyo will be redeployed in the Gulf of San Matias in the Rio Negro province offshore Argentina, liquifying gas from the Vaca Muerta Shale formation onshore in Neuquen province for 20 years. FLNG Hilli Episeyo, with a nameplate capacity of 2.45 MMt/year, is set to recommence operations in 2027.

The upgrading of FLNG Hilli Episeyo is part of a broader suite of solutions developed by Seatrium to address the industry’s focus on energy transition, with LNG widely regarded as a transition fuel.

FLNG Hilli Episeyo was converted and delivered by the Group in 2017. Seatrium also delivered FLNG Gimi to Golar in 2023, which has recently started commercial operations at the Greater Tortue Ahmeyim Field.

Since its first LNGC drydocking and ship repair in the 1980s, Seatrium has developed extensive expertise in LNG-related cryogenic systems. Today, the Group is a recognised industry leader in designing and building complex turnkey solutions - including newbuilds, conversions, and repairs for vessels that support the entire LNG value chain. Among its key milestones are the development of Singapore’s first LNG bunkering vessel, FueLNG Bellina, in 2021; the creation of the country’s first floating hybrid energy storage system, the Floating Living Lab, which enables sustainable LNG vessel refueling; and the construction of various dual-fuel LNG dredgers and tugs, purpose-built LNG carriers, and LNG-powered containerships.