UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
Report of Foreign Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the month of November , 2006
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Commission File Number: 000-50113
Golar LNG Limited
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(Translation of registrant's name into English)
Par-la-Ville Place, 14 Par-la-Ville Road, Hamilton, HM 08, Bermuda
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(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F
Form 20-F [X] Form 40-F [_]
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes [_] No [X]
Indicate by check mark if the registrant is submitting the Form 6-K in paper by
Regulations S-T Rule 101(b)(1):__________
Indicate by check mark if the registrant is submitting the Form 6-K in paper by
Regulations S-T Rule 101(b)(1):__________
If "Yes" is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b): 82
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Item 1. INFORMATION CONTAINED IN THIS FORM 6-K REPORT
Attached as Exhibit 1 is a copy of the press release of Golar LNG Limited
(the "Company"), dated November 20, 2006.
Exhibit 1
[GOLAR LNG LOGO OMITTED]
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THIRD QUARTER INTERIM REPORT
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July - Sept 2006
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Highlights
o Increase in revenue and operating income from previous quarter aided by
improved spot vessel earnings
o Interest rate swap valuation charge of $11.7 million results in a net loss
of $5.9 million
o Improved spot market rate outlook for the coming winter period
o Livorno shareholders agreement signed
Results
Golar LNG reports increased operating income at $23.9 million for the third
quarter of 2006, up from $22.3 million for the second quarter of 2006 and a net
loss in the current quarter of $5.9 million as compared to net income of $17.3
million for the second quarter of 2006.
Net income has been negatively impacted by mark-to-market interest rate swap
valuations, which resulted in a net charge of $11.7 million in the third quarter
as compared to a net gain last quarter of $8.3 million. This $20 million swing
has been caused by the decline in long-term interest rates during the quarter.
However, as approximately 43% of Golar's debt is on floating rate terms, lower
interest rates in the future will, if sustained, improve long term earnings.
Revenues in the third quarter increased to $55.9 million up from $53.7 million
in the second quarter. Increased earnings of spot vessels and the addition of
the Granosa to the fleet in June 2006, offset in part by the offhire time for
two vessels undergoing scheduled drydockings, have been the drivers behind the
improvement in revenues and operating income. Average daily time charter
equivalent rates (TCE's) for the fleet were $52,000 per day during the third
quarter of 2006 as compared to $49,700 for the second quarter of 2006.
Vessel operating expenses at $11.2 million for the quarter were increased from
$10.0 million for the second quarter of 2006 as a result of the addition of the
Granosa to the fleet. Administrative expenses were at a similar level to the
second quarter of 2006
Net interest expense for the third quarter was $16.4 million compared to $14.1
million for the second quarter of 2006. This increase is mainly due to a full
quarter's charge in respect of the $120 million Granosa facility and the
additional interest cost arising from the Company's floating rate debt as a
result of recent interest rate increases.
As noted above the results for the third quarter of 2006 have been negatively
impacted by the mark-to-market revaluation of interest swaps arising because of
the decrease in long-term interest rates. This valuation movement is the primary
reason for the other financial items charge of $14.1 million as compared to a
net gain of $11.7 million for the second quarter of 2006.
The increase in net earnings of investees (Korea Line and LNG Ltd) from $0.1
million for the second quarter of 2006 to $1.6 million for this quarter is
primarily as a result of Korea Line's improved earnings. The market value of
Golar's investment in Korea Line has increased to $79 million as at the end of
the third quarter and this positive development has continued into the fourth
quarter.
Year to date operating income at $74.8 million is already 15% ahead of operating
income for the full year of 2005 due to two vessels added to the fleet and
improved vessel earnings. Similarly net income for the nine months to September
30, 2006 of $39.4 million is up from $23.9 million for the same period last year
and 14% ahead of the full year 2005.
Corporate and Other Matters
Agreement was reached with OLT Energy Toscana SpA in November to acquire 20% of
the shares in the Livorno LNG regas terminal (OLT Offshore LNG Toscana S.p.A).
The new LNG terminal, which earlier this year was granted a government decree
approving or permitting the project, will have a regulated capacity of 3.75
Bcm/year. The terminal will be located 20 km out to sea off the Livorno coast;
away from populated areas creating substantial environmental and security
benefits and significantly reducing visual impact. Included in the deal is an
intention between the parties to sell the LNG carrier Golar Frost to the
project. It is also intended that Golar will have certain rights with respect to
regasification capacity and LNG transportation.
The company is encouraged by the progress being made by LNG Ltd (Golar LNG
shareholding 19.7%) with the 1.8 mtpa (million tonnes per annum) Padang LNG
project (Central Sulawesi, Indonesia), including final environmental approval
(AMDAL) received in October. LNG Ltd has been advised that a final decision in
relation to gas supply to the project will be made in November. Golar has signed
agreements to participate in a consortium with other major industry players to
jointly develop this project if selected by the upstream resource holder.
The Floating Power Generation Plant (FPGP) project in Cyprus is progressing well
with clarification meetings taking place in October 2006 between all interested
parties. A hearing at the Cyprus Environmental Service also took place in
October 2006 to review the Environmental Impact Assessment Study submitted by
Golar in relation to the FPGP. The Company is waiting for the report of this
meeting but does not however expect any major issues and also anticipates
receiving the relevant licences by the end of 2006.
Progress continues to be made on the Floating Storage and Regasification Unit
(FSRU) conversion project at Keppel Shipyard and discussions in relation to
employment of the FSRU are continuing with several potential charterers. The
Company has decided, based on the strength of the current market, to trade the
vessel likely to be used in this project, the Golar Spirit, in the spot market
after its charter to Pertamina expires in the fourth quarter of 2006. It will
continue to be employed in the spot market until a final decision on the
conversion schedule is made.
During October 2006 the Company extended the termination date of its Stock
Indexed Total Return Swap by twelve months.
Market
The third quarter of 2006 has experienced abnormally high levels of storing LNG,
both ashore and onboard vessels to maximise potential gains from both
geographical and seasonal LNG price differentials. By the end of the quarter
more than 10 vessels were employed in storage and this has significantly reduced
the number of vessels available in the spot market. This new development has
positively impacted spot time charter rates. Golar has directly participated and
arguably has led in this activity through its charter of the Golar Winter to
Shell from June this year.
Escalating LNG project construction costs and project complexities continue to
have an impact on the rate of development of the industry. This inevitably is
having an impact on shipyard berths and overall growth of the fleet.
A further 14.3 mtpa is scheduled for commissioning (either through new
installations or upgradings) in 2007, however this is in part offset by the
estimated decline in output from Arun and now Bontang of nearly 3.1 mtpa.
Currently there are 213 existing LNG carriers above 70,000 m(3) with 148 on
order.
Outlook
The LNG shipping market is generally well balanced although has moved slightly
in the ship owner's favour moving into the winter months. Delays in the
construction and commissioning of new LNG production capacity could in the
future influence this balance negatively whilst geographical market price
differentials, general seasonality and technical inefficiencies may well have a
positive impact. It is likely therefore that the 'spot' market will remain
volatile for some time yet.
The Board expects that earnings in the fourth quarter from the Company's spot
vessels and those under charter to Shell will show continued improvement as the
winter season approaches. Although an improvement in rates is anticipated, these
and levels of utilisation will remain highly sensitive to the development in
global gas prices and the price differences between the various markets for LNG
as these strongly impact the requirement for shipping.
The Board continues to believe that there are promising opportunities within the
Company's projects portfolio, which now fully cover the LNG mid stream
activities - liquefaction, shipping, trading and regasification. These projects
broaden the base of the company whilst maintaining the focus on LNG and provide
the opportunity to earn returns in excess of current LNG shipping returns whilst
also generating opportunity to employ existing company assets.
The Board is optimistic about the future development of the Company and looks
forward to improved earnings from the Company's spot market vessels over the
winter months. It is expected that earnings for the fourth quarter will confirm
this trend.
Forward Looking Statements
This press release contains forward looking statements. These statements are
based upon various assumptions, many of which are based, in turn, upon further
assumptions, including examination of historical operating trends made by the
management of Golar LNG. Although Golar LNG believes that these assumptions were
reasonable when made, because assumptions are inherently subject to significant
uncertainties and contingencies, which are difficult or impossible to predict
and are beyond its control, Golar LNG cannot give assurance that it will achieve
or accomplish these expectations, beliefs or intentions.
Included among the factors that, in the Company's view, could cause actual
results to differ materially from the forward looking statements contained in
this press release are the following: inability of the Company to obtain
financing for the new building vessels at all or on favourable terms; changes in
demand; a material decline or prolonged weakness in rates for LNG carriers;
political events affecting production in areas in which natural gas is produced
and demand for natural gas in areas to which our vessels deliver; changes in
demand for natural gas generally or in particular regions; changes in the
financial stability of our major customers; adoption of new rules and
regulations applicable to LNG carriers; actions taken by regulatory authorities
that may prohibit the access of LNG carriers to various ports; our inability to
achieve successful utilisation of our expanded fleet and inability to expand
beyond the carriage of LNG; increases in costs including: crew wages, insurance,
provisions, repairs and maintenance; changes in general domestic and
international political conditions; changes in applicable maintenance or
regulatory standards that could affect our anticipated dry-docking or
maintenance and repair costs; failure of shipyards to comply with delivery
schedules on a timely bases and other factors listed from time to time in
registration statements and reports that we have filed with or furnished to the
Securities and Exchange Commission, including our Registration Statement on Form
20-F and subsequent announcements and reports.
November 20, 2006
The Board of Directors
Golar LNG Limited
Hamilton, Bermuda
Questions should be directed to:
Tor Olav Troim - +44 7734 976 575
Golar Management (UK) Ltd - +44 207 517 8600:
Gary Smith: Chief Executive Officer
Charlie Peile: Executive Vice President, Head of Commercial
Graham Robjohns: Chief Financial Officer
GOLAR LNG LIMITED THIRD QUARTER 2006 REPORT (UNAUDITED)
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INCOME STATEMENT 2006 2005 2006 2005 2005
(in thousands of $) Jul - Sept Jul - Sept Jan - Sept Jan - Sept Jan - Dec
unaudited unaudited unaudited unaudited audited
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Operating revenues 55,938 42,787 166,960 125,891 171,042
Vessel operating expenses 11,157 9,253 31,520 28,470 37,215
Voyage expenses 2,189 967 8,881 3,413 4,594
Administrative expenses 3,974 2,658 10,093 9,295 13,563
Depreciation and amortization 14,723 12,913 41,713 37,869 50,991
Total operating expenses 32,043 25,791 92,207 79,047 106,363
Operating income 23,895 16,996 74,753 46,844 64,679
Interest income 10,304 8,752 29,358 26,941 35,653
Interest expense (26,708) (21,151) (73,669) (61,544) (82,479)
Other financial items (14,116) 8,963 7,534 1,498 7,507
(Loss)/income before taxes
and minority interest (6,625) 13,560 37,976 13,739 25,360
Minority interest (663) (2,164) (5,214) (5,947) (8,505)
Taxes (241) (152) (647) (571) (818)
Equity in net earnings of investee 1,600 (283) 7,244 16,711 18,492
Net (loss)/income (5,929) 10,961 39,359 23,932 34,529
Basic (loss)/earnings per share ($) ($0.09) $0.17 $0.60 $0.37 $0.53
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BALANCE SHEET 2006 2005 2005
(in thousands of $) Sept 30 Sept 30 Dec 31
unaudited unaudited audited
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ASSETS
Short term
Cash and cash equivalents 65,329 77,710 62,227
Restricted cash and short-term investments 53,976 43,703 49,448
Other current assets 24,872 17,194 17,898
Amounts due from related parties 525 28 17
Long term
Restricted cash 747,899 708,623 696,308
Equity in net assets of non-consolidated 80,531 65,380 65,950
associate
Newbuildings 33,107 109,248 111,565
Vessels and equipment, net 1,481,217 1,224,299 1,209,044
Other long term assets 31,325 10,885 18,238
Total assets 2,518,781 2,257,070 2,230,695
LIABILITIES AND STOCKHOLDERS' EQUITY
Short term
Current portion of long-term debt 72,461 65,822 67,564
Current portion of capital lease obligations 4,994 2,537 2,466
Other current liabilities 51,154 53,158 53,077
Amounts due to related parties 111 397 886
Long term
Long term debt 827,249 780,622 758,183
Long term capital lease obligations 971,963 818,671 801,500
Other long term liabilities 83,027 83,457 84,878
Minority interest 32,801 25,028 27,587
Stockholders' equity 475,021 427,378 434,554
Total liabilities and stockholders' equity 2,518,781 2,257,070 2,230,695
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STATEMENT OF CASH FLOWS 2006 2005 2006 2005 2005
(in thousands of $) Jul - Sept Jul - Sept Jan - Sept Jan - Sept Jan - Dec
unaudited unaudited unaudited unaudited audited
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OPERATING ACTIVITIES
Net (loss)/income (5,929) 10,961 39,359 23,932 34,529
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortisation 14,723 12,913 41,713 37,869 50,991
Amortisation of deferred charges 471 348 1,212 2,697 3,035
Income attributable to minority interests 663 2,164 5,214 5,947 8,505
Undistributed net earnings of
non-consolidated investee (1,600) 283 (6,064) (15,164) (16,948)
Drydocking expenditure (5,140) 145 (5,790) (9,238) (9,373)
Stock-based compensation 735 - 2,084 - -
Change in market value of equity, interest 9,477 (6,650) (18,614) 8,096 4,605
rate and currency derivatives
Interest element included in capital lease
obligations 526 1,706 3,791 5,437 7,351
Unrealised foreign exchange loss / (gain) 4,076 (3,221) 11,427 (12,524) (15,709)
Change in operating assets and liabilities 2,149 1,186 516 4,959 4,040
Net cash provided by operating activities 20,151 19,835 74,848 52,011 71,026
INVESTING ACTIVITIES
Additions to newbuildings (726) (1,246) (224,300) (137,711) (140,028)
Additions to vessels and equipment (1,606) (312) (10,799) (3,816) (5,700)
Long-term restricted cash 2,594 (5,974) 3,738 (53,813) (56,953)
Purchase of unlisted investments - - (500) (3,000) (3,000)
Purchase of marketable securities - - (10,386) - -
Proceeds from disposal of marketable
securities - - 2,248 - -
Short-term restricted cash and investments (6,430) (2,572) (4,528) (1,750) (7,495)
Net cash used in investing activities (6,168) (10,104) (244,527) (200,090) (213,176)
FINANCING ACTIVITIES
Proceeds from long-term debt - - 120,000 420,000 420,000
Proceeds from long-term capital lease
obligation - - 102,983 44,800 44,800
Repayments of long-term capital lease
obligation (1,242) (529) (2,798) (2,490) (3,004)
Repayments of long-term debt (12,944) (11,969) (46,038) (276,509) (297,206)
Financing costs paid - (117) (1,366) (3,743) (3,944)
Dividends paid to minority shareholders - (7,200) - (7,200) (7,200)
Payments to repurchase equity - - - (667) (667)
Net cash provided by financing activities (14,186) (19,815) 172,781 174,191 152,779
Net (decrease) / increase in cash and cash
equivalents (203) (10,084) 3,102 26,112 10,629
Cash and cash equivalents at beginning of
period 65,532 87,794 62,227 51,598 51,598
Cash and cash equivalents at end of period 65,329 77,710 65,329 77,710 62,227
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Notes
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1. The financial information included in this interim report has been derived
from information prepared by the Company in accordance with accounting
principles generally accepted in the United States of America.
2. The number of shares outstanding as of September 30, 2006 was 65,562,000
(June 30, 2006: 65,562,000). The weighted average number of shares
outstanding for the third quarter and nine months of 2006 was 65,562,000
and was 65,567,616 for the twelve months ended December 31, 2005.
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Golar LNG Limited
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(Registrant)
Date November 29, 2006 By /s/ Graham Robjohns
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Graham Robjohns
Chief Financial Officer
SK 03849 0004 726060