Flex LNG Secures USD 315 Mn to Finance Newbuildings

Oslo-listed ship owner and operator Flex LNG has reached an agreement on a loan facility to finance three of its newbuildings, scheduled for delivery in the first half of 2018.

The company received a firm offer for a USD 315 million term loan facility (TLF) on November 14, agreed to be drawn in connection with the delivery of the new ships.

Flex LNG said that the financing is subject to the execution of definitive documentation and satisfaction of customary closing conditions.

“The financing structure allows us to adjust the facility size depending on how we elect to employ our vessels and to substitute pledged vessels. This structure provides us significant balance sheet and operational flexibility as we grow our business,” Øystein M. Kalleklev, Flex LNG CFO, said.

Two of the company’s LNG carriers, originally ordered in 2013, are currently under construction at Samsung Heavy Industries and are scheduled to be delivered in the second and third quarters of 2018.

In February 2017, Flex LNG entered into a transaction for the acquisition of two high-end MEGI LNG carrier newbuilds under construction at Daewoo Shipbuilding and Marine Engineering. These ships are expected to join the fleet in the first quarter of 2018.

In April 2017, the company entered into an agreement to acquire two additional MEGI LNG carriers currently under construction at DSME, which are scheduled for delivery in 2019.

Upon delivery of the newbuildings, Flex LNG will own a fleet of six MEGI LNG carriers with the most advanced propulsion and fuel-efficient technology compared to the existing LNG fleet, the company informed.

The financing was unveiled in the company’s financial report for the third quarter of 2017, in which Flex LNG said that it operated four chartered-in LNG carriers during the quarter to be able to establish a market presence and build an operational track record.

The company added that, at the end of third quarter, two chartered-in vessels were redelivered while remaining two chartered-in vessels were subsequently extended for an additional 180 days.

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