Private equity group Stonepeak Infrastructure Partners has formed a 50:50 venture with ship operator Golar with the intention of owning and operating floating storage and regasification (FSR) vessels.
The preliminary announced plans call for an initial investment of $290 million by Stonepeak to establish the venture to be called Golar Power. The intention is to provide access to deep-sea LNG markets to regions that do not have sufficient demand or capital to create fixed receiving terminals.
The plan is just the latest of several efforts by companies involved in LNG to expand into smaller markets. Last month, Cheniere Energy Inc. announced plans to expand its LNG sales beyond the customary free-on-board basis and add delivered-ex-ship contracts. That would open new business to potential customers that do not have transport, storage or regasification.
Plans call for the Stonepeak-Golar venture to comprise one FSR under construction, two existing LNG tankers that will be converted to FSRs and options to acquire two other tankers from the Golar fleet to convert. The deal also includes rights to invest in a quarter of the Sergipe Power project in Brazil, which is slated to be in service in 2020.
No details were provided about how the venture would function, either as fee-based provider of transport and delivery or as a seller of LNG as well; nor was there any suggestion of the potential size of the market, or of potential LNG suppliers or customers. Neither partner responded to repeated inquires.
Gregory Morris can be reached at gmorris@hartenergy.com.
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