We embrace fresh thinking and our lean organisational structure enables us to develop new ideas quickly.

Our two most significant innovations have been:

  • The world’s first FSRU conversion, the Golar Spirit – which went into operation in 2008
  • The world’s first FLNG conversion, the Golar Hilli – which will go into operation in 2017

In both cases we converted an existing ship on a speculative basis. Conversion of an existing asset has enabled Golar to offer a quick-delivering and cheap solution to an industry problem, which might be:

  • A need to rapidly open up new markets for excess LNG or to meet urgent requirements for new gas fired power
  • A need to enable owners of stranded gas reserves to monetise their asset

Our willingness to initiate the speculative conversion of a ship into an FSRU or FLNG demonstrated our belief in the soundness of our offering. This in turn gave our first customers the confidence to transact with us.

"We are definitely not pack animals. We have demonstrated with our work with FLNG and FSRUs that we are prepared to take leadership."

To date, none of our competitors has successfully emulated this business model. Although the approach with FLNG is similar to an FSRU conversion, the cost and scale of FLNG represent a significant step up. We therefore believe that it will be some time before we face serious competition in the FLNG business.

Golar’s FLNG business model

The rate of offshore natural gas discoveries has soared in recent years. There are estimated to be at least 300,000 billion cubic feet of natural gas lying in offshore fields – of which 40% is estimated to be stranded. “Stranded gas” means gas that would not be viable to extract using established methods in use before Golar’s FLNG solution existed. Locating the liquefaction process offshore on a vessel can dramatically reduce the cost per MMBTU of liquefying gas. Converting a vessel in a specialised shipyard, where the skills and resources are already at hand and don’t need to be brought in, is much quicker and cheaper than building a facility in remote parts of the world that lack the essential infrastructure necessary to get started.

With our FLNG model, a mega-gasfield is no longer a prerequisite to monetisation. It is now easier to sell small parcels of gas without flooding the market. It is no longer necessary to find a large number of buyers at once.

Golar’s FLNG solution is based on the conversion of a Moss type LNG carrier fitted with tried-and-tested Black & Veatch (B&V) liquefaction technology and connected to a client-specified mooring system. The B&V PRICO® process uses a single mixed refrigerant technology that is simple, reliable and efficient. Black & Veatch has developed more than 30 operating LNG production facilities globally and most of them use this process. The PRICO® process also has a small enough footprint that it can be mounted on a vessel. The first marine-mounted B&V PRICO® process was successfully commissioned in 2016.

Golar’s FLNG business model

FLNG Hilli Episeyo

  • 14-15 million man-hours to completion
  • 1,200 km of cabling
  • 250 MW of power on board
  • 4,300 people on board to complete conversion
FSRU

The practice of converting LNG carriers into floating storage and regasification units (FSRUs) is now well accepted – thanks to innovation by Golar. We pioneered the FSRU conversion concept with the Golar Spirit, which went into operation in Brazil in 2008. We then successfully replicated the process three more times.

Newbuild FSRUs have since established themselves as a cost-effective alternative to conversions, for us at Golar and for other market participants.

Floating Storage and Regasification Units

An FSRU is an LNG carrier with onboard regasification equipment. It receives liquefied LNG, stores it, and converts it into natural gas for pipelines or onshore processing and power generation. FSRUs have a number of advantages over land-based LNG facilities. They are quicker to build and less expensive. They can be moved from one location to another as the business case demands. They remain largely unseen by the public and are not an unsightly, permanent feature of the landscape.

We put the first FSRU into operation in each of the four areas in which we operate: the Americas, the Middle East, Asia, and Africa. Golar Power, the Golar-Stonepeak joint venture, now plans to convert more of the latest generation of carriers into FSRUs.