[ ]
|
REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g)
OF THE SECURITIES EXCHANGE ACT OF 1934
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OR
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[X]
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the fiscal year ended
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December 31, 2015
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OR
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[ ]
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from
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|
to
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OR
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[ ]
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SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Date of event requiring this shell company report
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Commission file number
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000-50113
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Golar LNG Limited
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(Exact name of Registrant as specified in its charter)
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(Translation of Registrant's name into English)
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Bermuda
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(Jurisdiction of incorporation or organization)
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2nd Floor, S.E. Pearman Building, 9 Par-la-Ville Road, Hamilton HM 11, Bermuda
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(Address of principal executive offices)
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Andrew Whalley, (1) 441 295 4705, (1) 441 295 3494
2nd Floor, S.E. Pearman Building, 9 Par-la-Ville Road, Hamilton HM 11, Bermuda
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Title of each class
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Name of each exchange
on which registered
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Common Shares, par value, $1.00 per share
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Nasdaq Global Select Market
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None
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(Title of class)
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None
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(Title of class)
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93,546,663 Common Shares, par $1.00, per share
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Yes
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X
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No
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Yes
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No
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X
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Yes
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X
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No
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Yes
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X
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No
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Large accelerated filer
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X
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Accelerated filer
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Non-accelerated filer
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U.S. GAAP
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X
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International Financial Reporting Standards as issued by the International Accounting
Standards Board
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Other
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Item 17
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Item 18
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Yes
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No
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X
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Yes
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No
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PART I
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PAGE
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ITEM 1.
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ITEM 2.
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ITEM 3.
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ITEM 4.
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ITEM 4A.
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ITEM 5.
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ITEM 6.
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ITEM 7.
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ITEM 8.
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ITEM 9.
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ITEM 10.
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ITEM 11.
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ITEM 12.
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PART II
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ITEM 13.
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ITEM 14.
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ITEM 15.
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ITEM 16A.
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ITEM 16B.
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ITEM 16C.
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ITEM 16D.
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ITEM 16E.
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ITEM 16F.
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ITEM 16G.
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ITEM 16H.
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PART III
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ITEM 17.
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ITEM 18.
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ITEM 19.
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•
|
changes in liquefied natural gas, or LNG, carrier, floating storage and regasification unit, or FSRU, or floating liquefaction natural gas vessel, or FLNG, market trends, including charter rates, ship values or technological advancements;
|
•
|
changes in our ability to retrofit vessels as FSRUs or FLNGs, our ability to obtain financing for such conversions on acceptable terms or at all,
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•
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changes in the supply of or demand for LNG carriers, FSRUs or FLNGs;
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•
|
a material decline or prolonged weakness in rates for LNG carriers, FSRUs or FLNGs;
|
•
|
changes in the performance of the pool in which our vessels operate;
|
•
|
changes in trading patterns that affect the opportunities for the profitable operation of LNG carriers, FSRUs or FLNGs;
|
•
|
changes in the supply of or demand for LNG or LNG carried by sea;
|
•
|
changes in the supply of or demand for natural gas generally or in particular regions;
|
•
|
failure of our contract counterparties to comply with their agreements with us;
|
•
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changes in our relationships with our counterparties, including our major chartering parties;
|
•
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changes in the availability of vessels to purchase, the time it takes to construct new vessels, or vessels’ useful lives;
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•
|
failure of shipyards to comply with delivery schedules or performance specifications on a timely basis or at all;
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•
|
our ability to integrate and realize the benefits of acquisitions;
|
•
|
changes in our ability to sell vessels to Golar LNG Partners LP, or Golar Partners;
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•
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changes in our relationship with Golar Partners;
|
•
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changes to rules and regulations applicable to LNG carriers, FSRUs or FLNGs;
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•
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actions taken by regulatory authorities that may prohibit the access of LNG carriers, FSRUs or FLNGs to various ports;
|
•
|
our inability to achieve successful utilization of our expanded fleet or inability to expand beyond the carriage of LNG and provision of FSRUs, particularly through our innovative FLNG strategy, or GoFLNG;
|
•
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changes in our ability to obtain additional financing on acceptable terms or at all;
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•
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increases in costs, including, among other things, crew wages, insurance, provisions, repairs and maintenance;
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•
|
changes in general domestic and international political conditions, particularly where we operate;
|
•
|
a decline or continuing weakness in the global financial markets;
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•
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challenges by authorities to the tax benefits we previously obtained under certain of our leasing agreements; and
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•
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other factors listed from time to time in registration statements, reports or other materials that we have filed with or furnished to the Securities and Exchange Commission, or the Commission.
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||||||||||
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Years Ended December 31,
|
|||||||||
|
2015
|
2014
|
2013
|
2012
|
2011
|
|||||
|
(in thousands of U.S. $, except number of shares, per common share data, fleet and other financial data)
|
|||||||||
Statement of Operations Data:
(1)
|
|
|
|
|
|
|
|
|||
Total operating revenues
|
102,674
|
|
106,155
|
|
99,828
|
|
410,345
|
|
299,848
|
|
Vessel operating expenses
|
56,347
|
|
49,570
|
|
43,750
|
|
86,672
|
|
62,872
|
|
Depreciation and amortization
|
73,732
|
|
49,811
|
|
36,871
|
|
85,524
|
|
70,286
|
|
Total operating expenses
|
234,604
|
|
146,488
|
|
118,332
|
|
207,562
|
|
173,379
|
|
Gain on disposals to Golar Partners
|
102,884
|
|
43,783
|
|
65,619
|
|
—
|
|
—
|
|
Operating (loss) income
|
(35,902
|
)
|
(1,620
|
)
|
47,115
|
|
202,756
|
|
121,031
|
|
Total other non-operating income
|
12,513
|
|
27,484
|
|
27,605
|
|
857,929
|
|
541
|
|
Net financial expenses (income)
|
174,619
|
|
87,852
|
|
(41,768
|
)
|
42,868
|
|
53,102
|
|
(Loss) income before equity in net earnings (losses) of affiliates, income taxes and non-controlling interests
|
(198,008
|
)
|
(61,988
|
)
|
116,488
|
|
1,017,817
|
|
68,470
|
|
Net (loss) income
|
(178,501
|
)
|
(41,466
|
)
|
135,713
|
|
1,014,443
|
|
68,275
|
|
Net (loss) income attributable to the shareholders
|
(197,659
|
)
|
(43,121
|
)
|
135,713
|
|
971,303
|
|
46,650
|
|
(Loss) earnings per common share
|
|
|
|
|
|
|
||||
- basic
(2)
|
(2.12
|
)
|
(0.50
|
)
|
1.69
|
12.09
|
0.62
|
|||
- diluted
(2)
|
(2.12
|
)
|
(0.50
|
)
|
1.59
|
11.66
|
0.62
|
|||
Cash dividends declared and paid per common share
|
1.35
|
|
1.80
|
1.35
|
1.93
|
1.13
|
||||
Weighted average number of shares –
basic
(2)
(in thousands)
|
93,357
|
|
87,013
|
|
80,530
|
|
80,324
|
|
74,707
|
|
Weighted average number of shares –
diluted
(2)
(in thousands)
|
93,357
|
|
87,013
|
|
80,911
|
|
84,243
|
|
75,033
|
|
Balance Sheet Data (as of end of year):
|
|
|
|
|
|
|
||||
Cash and cash equivalents
|
105,235
|
|
191,410
|
|
125,347
|
|
424,714
|
|
66,913
|
|
Restricted cash and short-term receivables
(3)
|
228,202
|
|
74,162
|
|
23,432
|
|
1,551
|
|
28,012
|
|
Assets held-for-sale
|
269,459
|
|
284,955
|
|
—
|
|
—
|
|
—
|
|
Long-term restricted cash
(3)
|
180,361
|
|
425
|
|
3,111
|
|
—
|
|
185,270
|
|
Investments in affiliates
|
313,021
|
|
335,372
|
|
350,918
|
|
367,656
|
|
22,529
|
|
Cost method investments
|
204,172
|
|
204,172
|
|
204,172
|
|
198,524
|
|
7,347
|
|
Newbuildings
|
13,561
|
|
344,543
|
|
767,525
|
|
435,859
|
|
190,100
|
|
Asset under development
|
501,022
|
|
345,205
|
|
—
|
|
—
|
|
—
|
|
Vessels and equipment, net
|
2,336,144
|
|
1,648,888
|
|
811,715
|
|
573,615
|
|
1,203,003
|
|
Vessels under capital lease, net
|
—
|
|
—
|
|
—
|
|
—
|
|
501,904
|
|
Total assets
|
4,307,588
|
|
3,991,993
|
|
2,665,221
|
|
2,414,399
|
|
2,232,634
|
|
Current portion of long-term debt
|
501,618
|
|
116,431
|
|
30,784
|
|
14,400
|
|
64,306
|
|
Liabilities held-for-sale
|
203,638
|
|
164,401
|
|
—
|
|
—
|
|
—
|
|
Long-term debt (including debt due to a related party)
|
1,376,443
|
|
1,264,356
|
|
686,244
|
|
490,506
|
|
707,243
|
|
Long-term obligations under capital leases
|
—
|
|
—
|
|
—
|
|
—
|
|
399,934
|
|
Stockholders' equity
|
1,894,339
|
|
2,282,507
|
|
1,804,137
|
|
1,764,319
|
|
677,765
|
|
Common shares outstanding
(2)
(in thousands)
|
93,547
|
|
93,415
|
|
80,580
|
|
80,504
|
|
80,237
|
|
|
2015
|
2014
|
2013
|
2012
|
2011
|
||||||||||
Cash Flow Data
(1)
:
|
|
|
|
|
|
|
|
||||||||
Net cash (used in) provided by operating activities
|
(344,649
|
)
|
24,873
|
|
67,722
|
|
233,810
|
|
116,608
|
|
|||||
Net cash used in investing activities
|
(255,956
|
)
|
(1,429,270
|
)
|
(533,067
|
)
|
(290,700
|
)
|
(298,644
|
)
|
|||||
Net cash provided by financing activities
|
514,430
|
|
1,470,460
|
|
165,978
|
|
414,691
|
|
84,232
|
|
|||||
Fleet Data (unaudited)
|
|
|
|
|
|
|
|||||||||
Number of vessels at end of year
|
17
|
|
13
|
|
7
|
|
6
|
|
12
|
|
|||||
Average number of vessels during year
|
14.0
|
|
8.8
|
|
5.5
|
|
12.6
|
|
12
|
|
|||||
Average age of vessels (years)
|
9.7
|
|
10.8
|
|
18.7
|
|
25.4
|
|
18.8
|
|
|||||
Total calendar days for fleet
|
5,647
|
|
2,133
|
|
2,012
|
|
4,615
|
|
4,380
|
|
|||||
Total operating days for fleet
(4)
|
4,481
|
|
2,059
|
|
1,501
|
|
3,684
|
|
3,255
|
|
|||||
Other Financial Data (unaudited):
|
|
|
|
|
|
||||||||||
Average daily time charter equivalent earnings, or TCE
(5)
(to the closest $100)
|
$
|
14,900
|
|
$
|
33,100
|
|
$
|
38,300
|
|
$
|
94,200
|
|
$
|
87,700
|
|
Average daily vessel operating costs
(6)
|
$
|
11,783
|
|
$
|
23,240
|
|
$
|
21,745
|
|
$
|
18,780
|
|
$
|
14,354
|
|
•
|
A decrease in operating income and individual line items therein, in relation to Golar Partner’s fleet; and
|
•
|
A decrease in net financial expense in respect of Golar Partner’s debt and capital lease obligations, net of restricted cash deposits.
|
•
|
Gains on disposals to Golar Partners;
|
•
|
Management fee income from the provision of services to Golar Partners under each of the management and administrative services and the fleet management agreements;
|
•
|
Dividend income in respect of our interests in common units, general partner interests (during the subordination period) and incentive distribution rights, or IDRs, of Golar Partners; and
|
•
|
Equity in net earnings of affiliates, will change to reflect our share of the results of Golar Partners calculated with respect to our interests in its subordinated units only, but offset by a charge for the amortization of the basis difference in relation to the $854 million gain on loss of control.
|
•
|
"Investment in affiliates" of $362.1 million was initially recognized representing our subordinated unit interests held in Golar Partners that during the subordination period will be accounted for under the equity method.
|
•
|
"Cost method investments"of $191.2 million was initially recognized representing our 2% general partner interest and 100% of the IDRs held in Golar Partners.
|
•
|
The net book value of "Vessels and equipment" was reduced by $707.1 million.
|
•
|
The net book value of "Vessels under capital leases" was reduced by $485.6 million.
|
•
|
Restricted cash was reduced by $221.4 million.
|
•
|
Capital lease obligations were eliminated.
|
•
|
Long-term debt was reduced by $704.5 million.
|
|
Years Ended December 31,
|
|||||||||||||
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|
2011
|
|
|
(in thousands of U.S. $, except number of shares, per common share data, fleet and other financial data)
|
|||||||||||||
Time and voyage charter revenues
|
90,127
|
|
|
95,399
|
|
|
90,558
|
|
|
409,593
|
|
|
299,848
|
|
Voyage expenses*
|
(23,434
|
)
|
|
(27,340
|
)
|
|
(14,259
|
)
|
|
(9,853
|
)
|
|
(6,042
|
)
|
|
66,693
|
|
|
68,059
|
|
|
76,299
|
|
|
399,740
|
|
|
293,806
|
|
Calendar days less scheduled off-hire days
|
4,481
|
|
|
2,059
|
|
|
1,994
|
|
|
4,245
|
|
|
3,352
|
|
Average daily TCE rate (to the closest $100)
|
14,900
|
|
|
33,100
|
|
|
38,300
|
|
|
94,200
|
|
|
87,700
|
|
•
|
merge into, or consolidate with, any other entity or sell, or otherwise dispose of, all or substantially all of our assets;
|
•
|
make or pay equity distributions;
|
•
|
incur additional indebtedness;
|
•
|
incur or make any capital expenditures;
|
•
|
materially amend, or terminate, any of our current charter contracts or management agreements; or
|
•
|
charter our vessels.
|
•
|
Our ability to obtain additional financing, if necessary, for working capital, capital expenditures, acquisitions or other purposes may be impaired or such financing may not be available on favorable terms;
|
•
|
We will need a substantial portion of our cash flow to make principal and interest payments on our debt, reducing the funds that would otherwise be available for operations, future business opportunities and dividends to stockholders;
|
•
|
We may be more vulnerable than our competitors with less debt to competitive pressures or a downturn in our industry or the economy generally; and
|
•
|
Our flexibility in obtaining additional financing, pursuing other business opportunities and responding to changing business and economic conditions may be limited.
|
•
|
LNG shipping and FSRU experience and quality of ship operations;
|
•
|
shipping industry relationships and reputation for customer service and safety;
|
•
|
technical ability and reputation for operation of highly specialized vessels, including FSRUs;
|
•
|
quality and experience of seafaring crew;
|
•
|
the ability to finance FSRUs and LNG carriers at competitive rates, and financial stability generally;
|
•
|
construction management experience, including, (i) relationships with shipyards and the ability to get suitable berths and (ii) the ability to obtain on-time delivery of new FSRUs and LNG carriers according to customer specifications;
|
•
|
willingness to accept operational risks pursuant to a charter, such as allowing termination of the charter for force majeure events; and
|
•
|
competitiveness of the bid in terms of overall price.
|
•
|
we may not be able to employ our vessels at charter rates as favorable to us as historical rates or at all or operate our vessels profitably; and
|
•
|
the market value of our vessels could decrease, which may cause us to recognize losses if any of our vessels are sold or if their values are impaired.
|
•
|
marine disasters;
|
•
|
piracy;
|
•
|
environmental accidents;
|
•
|
bad weather;
|
•
|
mechanical failures;
|
•
|
grounding, fire, explosions and collisions;
|
•
|
human error; and
|
•
|
war and terrorism.
|
•
|
death or injury to persons, loss of property or environmental damage;
|
•
|
delays in the delivery of cargo;
|
•
|
loss of revenues from or termination of charter contracts;
|
•
|
governmental fines, penalties or restrictions on conducting business;
|
•
|
higher insurance rates; and
|
•
|
damage to our reputation and customer relationships generally.
|
•
|
price and availability of natural gas, crude oil and petroleum products;
|
•
|
increases in the cost of natural gas derived from LNG relative to the cost of natural gas;
|
•
|
decreases in the cost of, or increases in the demand for, conventional land-based regasification and liquefaction systems, which could occur if providers or users of regasification or liquefaction services seek greater economies of scale than FSRUs or FLNGs can provide, or if the economic, regulatory or political challenges associated with land-based activities improve;
|
•
|
further development of, or decreases in the cost of, alternative technologies for vessel-based LNG regasification or liquefaction;
|
•
|
increases in the production of natural gas in areas linked by pipelines to consuming areas, the extension of existing, or the development of new, pipeline systems in markets we may serve, or the conversion of existing non-natural gas pipelines to natural gas pipelines in those markets;
|
•
|
negative global or regional economic or political conditions, particularly in LNG-consuming regions, which could reduce energy consumption or its growth;
|
•
|
decreases in the consumption of natural gas due to increases in its price relative to other energy sources or other factors making consumption of natural gas less attractive;
|
•
|
any significant explosion, spill or other incident involving an LNG facility or carrier, conventional land-based regasification or liquefaction system, or FSRU or FLNG;
|
•
|
a significant increase in the number of LNG carriers, FSRUs or FLNGs available, whether by a reduction in the scrapping of existing vessels or the increase in construction of vessels;
|
•
|
infrastructure constraints such as delays in the construction of export or liquefaction facilities, the inability of project owners or operators to obtain governmental approvals to construct or operate LNG facilities, as well as
|
•
|
availability of new, alternative energy sources, including compressed natural gas.
|
•
|
increases in interest rates or other events that may affect the availability of sufficient financing for LNG projects on commercially reasonable terms;
|
•
|
decreases in the price of LNG, which might decrease the expected returns relating to investments in LNG projects;
|
•
|
the inability of project owners or operators to obtain governmental approvals to construct or operate LNG facilities;
|
•
|
local community resistance to proposed or existing LNG facilities based on safety, environmental or security concerns;
|
•
|
any significant explosion, spill or similar incident involving an LNG production, liquefaction or regasification facility, FSRU or LNG carrier; and
|
•
|
labor or political unrest affecting existing or proposed areas of LNG production, liquefaction and regasification.
|
•
|
price and availability of crude oil and petroleum products;
|
•
|
worldwide demand for natural gas;
|
•
|
the cost of exploration, development, production, transportation and distribution of natural gas;
|
•
|
expectations regarding future energy prices for both natural gas and other sources of energy;
|
•
|
the level of worldwide LNG production and exports;
|
•
|
government laws and regulations, including but not limited to environmental protection laws and regulations;
|
•
|
local and international political, economic and weather conditions;
|
•
|
political and military conflicts; and
|
•
|
the availability and cost of alternative energy sources, including alternate sources of natural gas in gas importing and consuming countries.
|
•
|
prevailing economic and market conditions in the natural gas and energy markets;
|
•
|
a substantial or extended decline in demand for LNG;
|
•
|
increases in the supply of vessel capacity;
|
•
|
the type, size and age of a vessel; and
|
•
|
the cost of newbuildings or retrofitting or modifying existing vessels, as a result of technological advances in vessel design or equipment, changes in applicable environmental or other regulations or standards, customer requirements or otherwise.
|
•
|
prevailing economic and market conditions in the natural gas and energy markets;
|
•
|
negative global or regional economic or political conditions, particularly in LNG-consuming regions, which could reduce energy consumption or its growth;
|
•
|
declines in demand for LNG or the services of LNG carriers, FSRUs or FLNGs;
|
•
|
increases in the supply of LNG carrier capacity operating in the spot/short-term market or the supply of FSRUs or FLNGs;
|
•
|
marine disasters; war, piracy or terrorism; environmental accidents; or inclement weather conditions;
|
•
|
mechanical failures or accidents involving any of our vessels; and
|
•
|
drydock scheduling and capital expenditures.
|
•
|
our existing shareholders’ proportionate ownership interest in us will decrease;
|
•
|
the amount of cash available for dividends payable on our common shares may decrease;
|
•
|
the relative voting strength of each previously outstanding common share may be diminished; and
|
•
|
the market price of our common shares may decline.
|
•
|
thirteen newbuildings (ten LNG carriers and three FSRUs), which we had ordered in 2011; and
|
•
|
The LNG carrier, the
LNG Abuja
, which we acquired for $20 million in April 2015. Albeit she was subsequently sold in July 2015.
|
•
|
In February 2013, we sold our equity interest in the company that owns and operates the
Golar Maria
for $215 million, of which $127.9 million was paid in cash and the remainder was paid through the assumption of $89.5 million of the debt associated with the vessel
and interest rate swap liability of $3.1 million plus purchase price adjustments of $5.5 million;
|
•
|
In March 2014, we sold our interest in the company that owns and operates the FSRU,
Golar Igloo
for $310 million, of which $156 million was paid in cash and the remainder was paid through the assumption of $161.3 million of debt associated with the vessel, plus the interest rate swap asset and other purchase price adjustments of $3.6 million and $3.7 million, respectively;
|
•
|
In January 2015, we sold our interests in the companies that own and operate the FSRU,
Golar Eskimo
(including charter) for $388.8 million less the assumed $162.8 million of bank debt plus other purchase price adjustments. Golar Partners financed the remaining purchase price by using $7.2 million cash on hand and the proceeds of a $220 million loan from us.
|
•
|
In February 2016, we agreed to sell the
Golar Tundra
for $330 million for the vessel and charter, less the net lease obligations plus other purchase price adjustments. We expect to complete on this transaction in May 2016.
|
•
|
As discussed above, following the acquisition of the
LNG Abuja
in April 2015, we subsequently sold her in July 2015 for cash consideration of $19 million, resulting in the recognition of an impairment loss of $1 million.
|
•
|
In February 2015, we completed the sale of our LNG carrier, the
Golar Viking
to a third party for $135.0 million. In connection with the sale, we provided initial bridging finance of $133.0 million plus a revolving credit facility of $5 million. However, due to the acquiree’s difficulties in realizing any short-haul cabotage trade opportunities in Indonesia, we agreed to the repossession of the vessel in consideration for extinguishment for the outstanding balances on the loan receivables. Accordingly, we repossessed the vessel in December 2015. Refer to note 9 “Other financial items, net” to the Consolidated Financial Statements contained herein for additional information.
|
Vessel Name
|
|
Initial Year of
Delivery
|
|
Capacity Cubic Metres
|
|
Flag
|
|
Type
|
|
Charterer/ Pool Arrangement
|
|
Current Charter/ Pool Expiration
|
|
Charter Extension Options
|
|
||||||||||||||
Existing Fleet
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hilli
(1)(2)
|
|
1975
|
|
125,000
|
|
MI
|
|
Moss
|
|
Perenco
|
|
n/a
|
|
n/a
|
Gimi
(1)(3)
|
|
1976
|
|
125,000
|
|
MI
|
|
Moss
|
|
n/a
|
|
n/a
|
|
n/a
|
Gandria
(1)
|
|
1977
|
|
126,000
|
|
MI
|
|
Moss
|
|
n/a
|
|
n/a
|
|
n/a
|
Golar Arctic
(4)
|
|
2003
|
|
140,000
|
|
MI
|
|
Membrane
|
|
New Fortress Energy Transport Partners LLC
|
|
2018
|
|
n/a
|
Golar Viking
(7)
|
|
2005
|
|
140,000
|
|
MI
|
|
Membrane
|
|
n/a
|
|
n/a
|
|
n/a
|
Golar Seal
(5)
|
|
2013
|
|
160,000
|
|
MI
|
|
Membrane
|
|
Cool pool
|
|
n/a
|
|
n/a
|
Golar Celsius
(5)
|
|
2013
|
|
160,000
|
|
MI
|
|
Membrane
|
|
Cool pool
|
|
n/a
|
|
n/a
|
Golar Penguin
(5)
|
|
2014
|
|
160,000
|
|
MI
|
|
Membrane
|
|
Cool pool
|
|
n/a
|
|
n/a
|
Golar Crystal
(5)
|
|
2014
|
|
160,000
|
|
MI
|
|
Membrane
|
|
Cool pool
|
|
n/a
|
|
n/a
|
Golar Bear
(5)
|
|
2014
|
|
160,000
|
|
MI
|
|
Membrane
|
|
Cool pool
|
|
n/a
|
|
n/a
|
Golar Glacier
(5)
|
|
2014
|
|
162,000
|
|
MI
|
|
Membrane
|
|
Cool pool
|
|
n/a
|
|
n/a
|
Golar Frost
(5)
|
|
2014
|
|
160,000
|
|
MI
|
|
Membrane
|
|
Cool pool
|
|
n/a
|
|
n/a
|
Golar Snow
(5)
|
|
2015
|
|
160,000
|
|
MI
|
|
Membrane
|
|
Cool pool
|
|
n/a
|
|
n/a
|
Golar Ice
(5)
|
|
2015
|
|
160,000
|
|
MI
|
|
Membrane
|
|
Cool pool
|
|
n/a
|
|
n/a
|
Golar Kelvin
(5)
|
|
2015
|
|
162,000
|
|
MI
|
|
Membrane
|
|
Cool pool
|
|
n/a
|
|
n/a
|
Golar Tundra
|
|
2015
|
|
170,000
|
|
MI
|
|
Membrane
|
|
West Africa Gas Limited ("WAGL")
|
|
2021
|
|
Five years
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chartered-in
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Golar Grand
(6) (7)
|
|
2006
|
|
145,700
|
|
MI
|
|
Membrane
|
|
n/a
|
|
n/a
|
|
n/a
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Newbuilding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hull 2189
|
|
2017
|
|
170,000
|
|
MI
|
|
Membrane
(FSRU) |
|
n/a
|
|
n/a
|
|
n/a
|
(1)
|
We have contracts with Keppel and Black & Veatch for the conversion of three LNG carriers, the
Hilli
, the
Gimi
and the
Gandria
, to FLNGs, with estimated deliveries from 2017 through to 2019. The
Hilli
is in the process of being converted and the
Gimi
and the
Gandria
are currently in lay-up awaiting delivery to Keppel for conversion. The conversion agreements for the
Gimi
and the
Gandria
include certain cancellation provisions which, if exercised prior to December 2016, will allow the termination of the contracts and the recovery of previous milestone payments, less a cancellation fee and payment for costs already incurred.
|
(2)
|
We have agreements with Perenco, SNH, and the Republic of Cameroon relating to a floating liquefied natural gas export project offshore Kribi, Cameroon that is expected to employ the converted
Hilli
. Under the terms of the agreements, the converted
Hilli
is scheduled to provide liquefaction services to the project by the second quarter of 2017 for an initial term of 8 years. However, these agreements are subject to significant conditions which, if not satisfied, or waived by the customer, may result in termination prior to or after employment commences, in which case we may not realize any revenues under such agreements.
|
(3)
|
We have a heads of terms agreement with Ophir for the provision of the
Gimi
or an alternate FLNG to provide liquefaction services. The provision of services is expected to be structured as a 20-year tolling contract, with the
Gimi
or an alternate FLNG commencing commercial operations in the first half 2019 in Equatorial Guinea, but we cannot assure you that this project will ultimately proceed as planned or employ any of our GoFLNG vessels.
|
(4)
|
Commenced in March 2016. The charter expiration date is a date, to be determined at the charterer’s option, within 30 days before or after the 26 month charter term.
|
(5)
|
As of
April 27, 2016
, we have ten vessels operating in the Cool Pool. See "Cool Pool."
|
(6)
|
In November 2012, we entered into an Option Agreement in connection with the disposal of the
Golar Grand,
providing
Golar Partners
with the option to require us to charter the vessel through to October 2017. Golar Partners exercised this option in February 2015.
|
(7)
|
These vessels are currently in lay-up.
|
•
|
Capitalize on Golar's established reputation:
We are an experienced and professional provider of LNG mid-stream services that places value on operating to the highest industry standards of safety, reliability and environmental performance. We believe our strong technical capability and extensive commercial experience enables us to obtain attractive new business opportunities not readily available to other industry participants.
|
•
|
Operation of a high quality and modern LNG Carrier fleet:
We currently own and operate a fleet of high quality LNG Carriers with an average age of 2.4 years. Our ten recently delivered vessels all utilize state of the art technology and are configured to be very attractive to the chartering community with high performance specifications.
|
•
|
Maintain our leadership position in the provision of FSRUs:
We currently enjoy an industry leadership position in the development, delivery and operation of FSRUs based on an unblemished record of successful project delivery and highly reliable vessel operation. We will continue to work with our customers to identify and deliver new and profitable FSRU projects, including working with power project developers requiring FSRUs.
|
•
|
Utilize our industry expertise to develop new FLNG opportunities:
Our GoFLNG investment proposition is built around a sound technical and commercial offering, derived from structurally lower unit capital costs, shorter lead times and lower project execution risk profiles. GoFLNG allows smaller resource holders, developers and customers to enter the LNG business and occupy a legitimate space alongside the largest resource holders, major oil companies and world-scale LNG buyers. For the established LNG industry participants, the prospect of GoFLNG’s lower unit costs and risks should provide an important and compelling alternative to the traditional giant land based projects especially in the current energy price environment, which we believe may well accelerate the pace of change.
|
•
|
Leverage on our affiliation with Golar Partners:
We believe our affiliation with Golar Partners positions us to pursue a broader array of opportunities. This is demonstrated by:
|
•
|
The
Moss
system was developed in the 1970s and uses free standing insulated spherical tanks supported at the equator by a continuous cylindrical skirt. In this system, the tank and the hull of the vessel are two separate structures.
|
•
|
The
Membrane
system uses insulation built directly into the hull of the vessel, along with a membrane covering inside the tanks to maintain their integrity. In this system, the ship's hull directly supports the pressure of the LNG cargo.
|
•
|
FSRUs that are permanently located offshore;
|
•
|
FSRUs that are permanently near shore and attached to a jetty (with LNG transfer being either directly ship to ship or over a jetty);
|
•
|
shuttle carriers that regasify and discharge their cargos offshore; and
|
•
|
shuttle carriers that regasify and discharge their cargos alongside.
|
•
|
injury to, destruction or loss of, or loss of use of, natural resources and the costs of assessment thereof;
|
•
|
on-board installation of automatic identification systems to provide a means for the automatic transmission of safety-related information from among similarly equipped ships and shore stations, including information on a ship's identity, position, course, speed and navigational status;
|
•
|
on-board installation of ship security alert systems, which do not sound on the vessel but only alerts the authorities on shore;
|
•
|
the development of vessel security plans;
|
•
|
ship identification number to be permanently marked on a vessel's hull;
|
•
|
a continuous synopsis record kept onboard showing a vessel's history including, the name of the ship and of the state whose flag the ship is entitled to fly, the date on which the ship was registered with that state, the ship's identification number, the port at which the ship is registered and the name of the registered owner(s) and their registered address; and
|
•
|
compliance with flag state security certification requirements.
|
Name
|
Jurisdiction of Incorporation
|
Purpose
|
Golar LNG 2216 Corporation
|
Marshall Islands
|
Owns
Golar Arctic
|
Golar Management Limited
|
United Kingdom
|
Management company
|
Golar GP LLC – Limited Liability Company
|
Marshall Islands
|
Holding company
|
Golar LNG Energy Limited
|
Bermuda
|
Holding company
|
Golar Gimi Corporation
|
Marshall Islands
|
Owns
Gimi
|
Golar Hilli Corporation (89%)*
|
Marshall Islands
|
Owns
Hilli
|
Golar Gandria N.V.
|
Netherlands
|
Owns and operates
Gandria
|
Golar Hull M2021 Corporation
|
Marshall Islands
|
Leases and operates
Golar Seal***
|
Golar Hull M2022 Corporation
|
Marshall Islands
|
Owns and operates
Golar Crystal
|
Golar Hull M2023 Corporation
|
Marshall Islands
|
Owns and operates
Golar Penguin
|
LNG Power Limited
|
United Kingdom
|
Holding company
|
Golar Hull M2026 Corporation
|
Marshall Islands
|
Owns and operates
Golar Celsius
|
Golar Hull M2027 Corporation
|
Marshall Islands
|
Owns and operates G
olar Bear
|
Golar Hull M2047 Corporation
|
Marshall Islands
|
Leases and operates
Golar Snow***
|
Golar Hull M2048 Corporation
|
Marshall Islands
|
Leases and operates
Golar Ice***
|
Golar LNG NB10 Corporation
|
Marshall Islands
|
Leases and operates
Golar Glacier***
|
Golar LNG NB11 Corporation
|
Marshall Islands
|
Leases and operates
Golar Kelvin***
|
Golar LNG NB12 Corporation
|
Marshall Islands
|
Owns and operates
Golar Frost
|
Golar LNG NB13 Corporation
|
Marshall Islands
|
Leases and operates
Golar Tundra***
|
GVS Corporation
|
Marshall Islands
|
Owns
Golar Viking
|
Golar Management Norway AS**
|
Norway
|
Management company
|
Golar Commodities Limited
|
Bermuda
|
Trading company
|
•
|
Our results will be dependent in part on the performance of the Cool Pool.
In October 2015, we, along with GasLog and Dynagas, established the Cool Pool, to market our LNG carriers which are currently operating in the LNG shipping spot market. As of
April 27, 2016
, we had contributed 10 of the 16 vessels to the pool. Each of the vessel owners continues to be responsible for the manning and the technical management of its respective vessels. Our share of the net pool revenues will be dependent upon the performance of the Pool Manager in securing employment and negotiating rates for all of the pool vessels.
|
•
|
For periods when vessels are in lay-up, vessel operating and voyage costs will be lower.
Five of our vessels have recently been laid-up. The
Hilli
and the
Gandria
were placed into lay-up in April 2013, the
Gimi
from January 2014 and, more recently, the
Golar Grand
and the
Golar Viking
in December 2015. However, the
Hilli
entered the shipyard in September 2014 and commenced her retrofitting to a FLNG. Both the
Gimi
and the
Gandria
are currently still in lay-up but have been earmarked for use in our FLNG vessel conversion projects pending lodgment of their final notices to proceed. We receive no revenues for vessels while they are in lay-up or being converted, but we benefit from lower vessel operating costs, principally from reduced crew on board, and minimal maintenance requirements and voyage costs.
|
•
|
We or our consolidated entities may enter into different financing arrangements.
Our current financing arrangements may not be representative of the arrangements we will enter into in the future. For example, we may amend our existing credit facilities or enter into other financing arrangements, which may be more expensive. In addition, by virtue of the sale and leaseback transactions we have entered into with certain lessor VIEs, where we are deemed to be the primary beneficiary of the VIEs, we are required to consolidate these VIEs into our results. Although consolidated into our results, we have no control over the funding arrangements negotiated by these lessor VIEs such as interest rates, maturity and repayment profiles. For additional detail refer to note 4 "Variable Interest Entities" to our Consolidated Financial Statements. As of December 31, 2015, we consolidated lessor VIEs in connection with the lease financing transactions for five of our vessels. For descriptions of our current financing arrangements, please read "Item 5. Operating and Financial Review and Prospects-B. Liquidity and Capital Resources-Borrowing Activities."
|
•
|
The costs of our projects may change.
We are continuing to invest in and develop our various projects, such as FLNG conversion. The costs we have incurred historically for our projects may not be indicative of future costs.
|
•
|
Our results are affected by fluctuations in the fair value of our derivative instruments
. The change in fair value of some of our derivative instruments is included in our net income. These changes may fluctuate significantly as interest rates or the price of our common shares fluctuate. Our TRS has a credit arrangement, whereby we are required to provide cash collateral on the initial acquisition price and to subsequently post additional cash collateral that corresponds to any further unrealized loss.
|
•
|
Expansion of our fleet.
As of
April 27, 2016
, our fleet comprises 17 vessels (including the
Golar Grand
chartered-in from Golar Partners), of which 11 are newbuilds (ten LNG carriers and one FSRU) delivered between 2013 and 2015; and the
Hilli
which is currently undergoing her conversion into a FLNG vessel. Additionally, we have one remaining newbuilding commitment, an FSRU, which is expected to be delivered in the fourth quarter of 2017.
|
•
|
the number of vessels in our fleet;
|
•
|
our ability to maintain good relationships with our key existing charterers and to increase the number of our charterer relationships;
|
•
|
increased demand for LNG shipping services, including FSRU services, and in connection with this underlying demand for and supply of natural gas and specifically LNG;
|
•
|
our ability to employ our vessels operating in the spot market and rates and levels of utilization achieved by our vessels;
|
•
|
the success of the Pool Manager in finding employment and negotiating charter rates for our vessels and the vessels other participants in the Cool Pool;
|
•
|
the success or failure of the LNG infrastructure (including FLNG) projects that we are working on or may work on in the future;
|
•
|
our ability to successfully employ our vessels at profitable rates;
|
•
|
our ability to execute strategic and mutually beneficial sales of our assets, similar to the past sale of six of our vessels conducted with Golar Partners, in exchange for cash of approximately $1.9 billion, and our ability to secure charters of an appropriate duration to the dropdown;
|
•
|
our ability to obtain funding in respect of our capital commitments;
|
•
|
the effective and efficient technical management of our and Golar Partners' vessels;
|
•
|
our ability to obtain and maintain major international energy company approvals and to satisfy their technical, health, safety and compliance standards; and
|
•
|
economic, regulatory, political and governmental conditions that affect the shipping industry, including changes in the number of LNG importing countries and regions and availability of surplus LNG from projects around the world, as well as structural LNG market changes allowing greater flexibility and enhanced competition with other energy sources.
|
•
|
employment of our vessels;
|
•
|
the hire rate earned by our vessels and unscheduled off-hire days;
|
•
|
non-utilization of vessels not subject to fixed rate charters;
|
•
|
pension and share option expenses;
|
•
|
mark-to-market charges in interest rate and equity swaps and foreign currency derivatives;
|
•
|
foreign currency exchange gains and losses;
|
•
|
our access to capital required to acquire additional vessels and/or to implement our business strategy;
|
•
|
the performance of our equity interests;
|
•
|
equity in earnings of affiliates;
|
•
|
increases in operating costs; and
|
•
|
our level of debt and the related interest expense and amortization of principal.
|
•
|
Six of our newbuildings (including the
Golar Igloo
, prior to her disposal to Golar Partners in March 2014), were delivered in 2014, all of which were affected by commercial waiting time;
|
•
|
Our vessels not on long-term charters were affected by commercial waiting time, including our newbuildings and vessels in lay-up. The
Hilli
and the
Gandria
were placed into lay-up in April 2013, the
Gimi
in January 2014 and, more recently, the
Golar Grand
and the
Golar Viking
in December 2015;
|
•
|
Charter-hire expenses of $41.6 million recognized in 2015, arising from the charter-back of both the
Golar Grand
and the
Golar Eskimo
from Golar Partners during 2015, under agreements executed at the time of their disposal to Golar Partners;
|
•
|
Additional operating costs of $1.8 million, $9.9 million and $13.2 million in 2015, 2014 and 2013, respectively, in connection with the increase in our crewing pool in anticipation of the delivery of our newbuilds;
|
•
|
Bank loans and other financing arrangements we entered into or terminated. This included the entry into the $1.125 billion financing agreement in July 2013 relating to financing for eight of our newbuildings, which resulted in the recognition of $5.6 million and $4.4 million of commitment fees in 2014 and 2013, respectively;
|
•
|
Interest costs of $7.1 million, $21.5 million and $22.5 million were capitalized in 2015, 2014 and 2013, respectively, in relation to newbuildings under construction and the FLNG conversion of the
Hilli
;
|
•
|
The realized and unrealized gains and losses on mark-to-market adjustments for our derivative instruments of $96.0 million loss, $63.0 million loss and $45.8 million gain in 2015, 2014 and 2013, respectively, and the impact of hedge accounting, which we ceased during 2015, for certain of our interest rate and equity swap derivatives;
|
•
|
Impairment loss arising on certain loan facilities granted to Equinox in February 2015, in connection with their acquisition of the vessel, the
Golar Viking
from us. Due to concerns with recoverability of these loans, we agreed upon the repossession of the vessel, and thus resulted in the recognition of a loss of $15 million;
|
•
|
Share options expense on options granted during 2015 and 2014; and
|
•
|
Project expenses such as those relating to FLNG project development.
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
|
Change
|
|
|
Change
|
|
Total operating revenues
|
102,674
|
|
|
106,155
|
|
|
(3,481
|
)
|
|
(3
|
)%
|
Voyage, charterhire and commission expenses
|
(69,042
|
)
|
|
(27,340
|
)
|
|
(41,702
|
)
|
|
153
|
%
|
•
|
A decline of $40.2 million in revenues relating to the
Golar Arctic
, as she was off-hire a significant amount of time in 2015 compared to her full employment in 2014 following the expiry of a charter in February 2015;
|
•
|
A decrease in revenue of $4.8 million relating to the
Golar Viking
, pursuant to her disposal in February 2015, albeit she was repossessed in December 2015; and
|
•
|
A net reduction in revenues of $4.5 million relating to the
Golar Seal
and
Golar Celsius
, principally due to the overall net increase in commercial waiting time suffered by these vessels in 2015.
|
•
|
$11.5 million of additional revenue related to our four newbuildings delivered in 2015 and also the availability of both the
Golar Grand
and the
Golar Eskimo
which were chartered back from Golar Partners in 2015 under agreements executed at the time of their disposals to Golar Partners, although the
Golar Eskimo
charter-back arrangement with Golar Partners ceased in June 2015;
|
•
|
$32.7 million higher revenue in 2015 compared to 2014 related to our six newbuildings delivered in 2014 (net of the effect of the disposal of the
Golar Igloo
in March 2014), reflecting both higher operating days and improved utilization for these vessels in 2015; and
|
•
|
An increase of $1.8 million in management fee income to $12.5 million in 2015 from the provision of services to Golar Partners under our management and administrative services and fleet management agreements compared to $10.8 million in 2014.
|
•
|
Additional $32.6 million charter-hire expense recognized in 2015 arising from the charter-back of the
Golar Grand
from Golar Partners, pursuant to the exercise of their option in February 2015 under the Option Agreement executed in connection with the disposal of the vessel to Golar Partners in 2012. Included within the $32.6 million is an amount of $3.9 million representing the incremental liability recognized in 2015 upon re-measurement of the guarantee obligation, net of the impact of the respective amortization expense during 2015;
|
•
|
Additional $12.9 million of charter-hire expense recognized in 2015 relating to the charter-back of the
Golar Eskimo
from Golar Partners for the period from January through to the end of June 2015. The charter-back arrangement with Golar Partners was in connection with the disposal of the
Golar Eskimo
in January 2015; and
|
•
|
An increase of $8.1 million in voyage expenses mainly as a result of higher fuel costs due to increased commercial waiting (during which we are required to pay for fuel for the vessel) due to both the continued softening of the LNG shipping market and the significant expansion in our fleet with the delivery of our ten newbuildings during 2014 and 2015. Accordingly, we suffered a higher number of off-hire days in aggregate of 2,622 in 2015, compared to 1,018 off-hire days in 2014.
|
|
2015
|
|
|
2014
|
|
|
Change
|
|
|
Change
|
|
|||
Calendar days less scheduled off-hire days
|
4,481
|
|
|
2,059
|
|
|
2,422
|
|
|
118
|
%
|
|||
|
|
|
|
|
|
|
|
|||||||
Average daily TCE rate (to the closest $100)
|
$
|
14,900
|
|
|
$
|
33,100
|
|
|
$
|
(18,200
|
)
|
|
(55
|
)%
|
(in thousands of $, except for average daily vessel operating costs)
|
2015
|
|
|
2014
|
|
|
Change
|
|
|
Change
|
|
Vessel operating expenses
|
56,347
|
|
|
49,570
|
|
|
6,777
|
|
|
14
|
%
|
|
|
|
|
|
|
|
|
||||
Average daily vessel operating costs
|
11,783
|
|
|
23,240
|
|
|
(11,457
|
)
|
|
(49
|
)%
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
|
Change
|
|
|
Change
|
|
Administrative expenses
|
28,657
|
|
|
17,468
|
|
|
11,189
|
|
|
64
|
%
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
|
Change
|
|
|
Change
|
|
Depreciation and amortization
|
73,732
|
|
|
49,561
|
|
|
24,171
|
|
|
49
|
%
|
•
|
Lower depreciation of $4.1 million in relation to the
Hilli
following the commencement of her conversion into a FLNG resulting in suspension of depreciation from July 2014. We will recommence her depreciation after completion of her conversion, which is expected to be in 2017;
|
•
|
A decrease of $4.4 million in depreciation expense attributable to the
Golar Viking
pursuant to her disposal in February 2015, albeit she was repossessed in December 2015; and
|
•
|
A decline of $4.7 million with respect to the
Gimi
and
Gandria
due to the full amortization of their drydock costs in 2014. Given both vessels are in lay-up and designated for FLNG conversion, no drydock was scheduled for these vessels during 2015.
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
|
Change
|
|
|
Change
|
|
Impairment of long-term assets
|
1,957
|
|
|
500
|
|
|
1,457
|
|
|
291
|
%
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
|
Change
|
|
|
Change
|
|
Gain on disposal to Golar Partners
|
102,884
|
|
|
43,783
|
|
|
59,101
|
|
|
135
|
%
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
|
Change
|
|
|
Change
|
|
Impairment of vessel held-for-sale
|
(1,032
|
)
|
|
—
|
|
|
(1,032
|
)
|
|
100
|
%
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
|
Change
|
|
|
Change
|
|
Other operating loss
|
—
|
|
|
(6,387
|
)
|
|
6,387
|
|
|
100
|
%
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
|
Change
|
|
|
Change
|
|
Loss on disposal of vessel
|
(5,824
|
)
|
|
—
|
|
|
(5,824
|
)
|
|
100
|
%
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
|
Change
|
|
|
Change
|
|
Dividend income
|
15,524
|
|
|
27,203
|
|
|
(11,679
|
)
|
|
(43
|
)%
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
|
Change
|
|
|
Change
|
|
Interest income on short-term loan to third party
|
296
|
|
|
268
|
|
|
28
|
|
|
10
|
%
|
Other interest income
|
6,600
|
|
|
448
|
|
|
6,152
|
|
|
1,373
|
%
|
Interest Income
|
6,896
|
|
|
716
|
|
|
6,180
|
|
|
863
|
%
|
Debt related interest expense
|
(62,911
|
)
|
|
(14,474
|
)
|
|
(48,437
|
)
|
|
335
|
%
|
Interest Expense
|
(62,911
|
)
|
|
(14,474
|
)
|
|
(48,437
|
)
|
|
335
|
%
|
Mark-to-market adjustment for interest rate swaps
|
(12,798
|
)
|
|
(28,996
|
)
|
|
16,198
|
|
|
(56
|
)%
|
Interest expense on undesignated interest rate swaps
|
(15,797
|
)
|
|
(20,424
|
)
|
|
4,627
|
|
|
(23
|
)%
|
Unrealized and realized (losses) gains on interest rate swaps
|
(28,595
|
)
|
|
(49,420
|
)
|
|
20,825
|
|
|
(42
|
)%
|
Market-to-market adjustments for equity derivatives
|
(67,925
|
)
|
|
(13,657
|
)
|
|
(54,268
|
)
|
|
397
|
%
|
Mark-to-market adjustments for foreign currency derivatives
|
—
|
|
|
94
|
|
|
(94
|
)
|
|
(100
|
)%
|
Impairment of loan
|
(15,010
|
)
|
|
—
|
|
|
(15,010
|
)
|
|
100
|
%
|
Financing arrangement fees and other costs
|
(1,841
|
)
|
|
(7,157
|
)
|
|
5,316
|
|
|
(74
|
)%
|
Other
|
(5,233
|
)
|
|
(3,954
|
)
|
|
(1,279
|
)
|
|
32
|
%
|
Other Financial Items, net
|
(118,604
|
)
|
|
(74,094
|
)
|
|
(44,510
|
)
|
|
60
|
%
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
|
Change
|
|
|
Change
|
|
Income taxes
|
(3,053
|
)
|
|
(1,114
|
)
|
|
(1,939
|
)
|
|
174
|
%
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
|
Change
|
|
|
Change
|
|
Share of net earnings in Golar Partners
|
16,173
|
|
|
18,319
|
|
|
(2,146
|
)
|
|
(12
|
)%
|
Share of net earnings in other affiliates
|
281
|
|
|
1,089
|
|
|
(808
|
)
|
|
(74
|
)%
|
|
16,454
|
|
|
19,408
|
|
|
(2,954
|
)
|
|
(15
|
)%
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
|
Change
|
|
|
Change
|
|
Net income attributable to non-controlling interests
|
19,158
|
|
|
1,655
|
|
|
17,503
|
|
|
1,058
|
%
|
(in thousands of $)
|
|
2015
|
|
|
2014
|
|
|
Change
|
|
|
Change
|
|
Administrative expenses
|
|
—
|
|
|
64
|
|
|
(64
|
)
|
|
(100
|
)%
|
Depreciation
|
|
—
|
|
|
250
|
|
|
(250
|
)
|
|
(100
|
)%
|
Other operating gains
|
|
—
|
|
|
(1,317
|
)
|
|
1,317
|
|
|
100
|
%
|
Other non-operating income
|
|
—
|
|
|
(718
|
)
|
|
718
|
|
|
(100
|
)%
|
Net financial expenses
|
|
—
|
|
|
252
|
|
|
(252
|
)
|
|
(100
|
)%
|
Net income
|
|
—
|
|
|
(1,469
|
)
|
|
1,469
|
|
|
(100
|
)%
|
(in thousands, $)
|
2015
|
2014
|
Change
|
% Change
|
||||
Administrative expenses
|
(4,869
|
)
|
(1,735
|
)
|
(3,134
|
)
|
181
|
%
|
Net loss
|
(4,869
|
)
|
(1,735
|
)
|
(3,134
|
)
|
181
|
%
|
(in thousands of $)
|
2014
|
|
|
2013
|
|
|
Change
|
|
|
Change
|
|
Total operating revenues
|
106,155
|
|
|
99,828
|
|
|
6,327
|
|
|
6
|
%
|
Voyage expenses
|
(27,340
|
)
|
|
(14,259
|
)
|
|
(13,081
|
)
|
|
92
|
%
|
•
|
$36.2 million revenue contributions in 2014 from our newbuildings despite a decline in charter rates and lower utilization levels. Five of our newbuildings were delivered in 2014 and two in 2013. There was no comparable income from our newbuildings in 2013;
|
•
|
$4.2 million revenue contribution from the
Golar Igloo
, following her delivery and the commencement of her charter with Kuwait Petroleum Company, or KNPC, in March 2014 and for the period prior to her disposal to Golar Partners in March 2014;
|
•
|
$2.4 million higher revenues from the
Golar Arctic
in 2014 compared to 2013, due to her scheduled drydocking in November 2013; and
|
•
|
Higher management fee income of $10.8 million in 2014 from the provision of services to Golar Partners under our management and administrative services and fleet management agreements compared to $9.3 million in 2013.
|
•
|
An overall decline in charter rates and lower utilization levels of our vessels trading on the spot market or in lay-up, more specifically for the
Golar Viking
and the
Gimi
. The
Gimi
entered in lay-up in January 2014. The total operating revenues generated by both vessels in 2014 were $4.8 million compared to $39.8 million in 2013; and
|
•
|
Reduction in revenues of $3.0 million in relation to the
Golar Maria
following her disposal to Golar Partners in February 2013.
|
|
2014
|
|
|
2013
|
|
|
Change
|
|
|
Change
|
|
|||
Calendar days less scheduled off-hire days
|
2,059
|
|
|
1,994
|
|
|
65
|
|
|
3
|
%
|
|||
|
|
|
|
|
|
|
|
|||||||
Average daily TCE rate (to the closest $100)
|
$
|
33,100
|
|
|
$
|
38,300
|
|
|
$
|
(5,200
|
)
|
|
(14
|
)%
|
(in thousands of $, except for average daily vessel operating costs)
|
2014
|
|
|
2013
|
|
|
Change
|
|
|
Change
|
|
Vessel operating expenses
|
49,570
|
|
|
43,750
|
|
|
5,820
|
|
|
13
|
%
|
|
|
|
|
|
|
|
|
||||
Average daily vessel operating costs
|
23,240
|
|
|
21,745
|
|
|
(6,450
|
)
|
|
(30
|
)%
|
•
|
Full year vessel operating expenses in 2014, in relation to our newbuildings, the
Golar Seal
and the
Golar Celsius
, delivered in October 2013, compared to approximately three months in 2013; and
|
•
|
Additional operating costs from our newbuildings, the
Golar Igloo
delivered in February 2014 (prior to her disposal to Golar Partners in March 2014), the
Golar Crystal
delivered in May 2014, the
Golar Bear
and the
Golar Penguin
delivered in September 2014, the
Golar Frost
and the
Golar Glacier
delivered in October 2014 and the
Golar Eskimo
delivered in December 2014. There were no comparable costs in 2013.
|
•
|
Lower operating costs in connection with our crewing pool, following the delivery of nine of our thirteen newbuilds, from October 2013 through to December 2014. Total operating costs in respect of our newbuild crewing pool in 2014 was $9.9 million compared to $13.2 million in 2013; and
|
•
|
Both the
Hilli
and the
Gandria
entered into lay-up in April 2013 (the
Hilli
entered into the shipyard in September 2014 to commence her conversion to a FLNG), followed by the
Gimi
in January 2014, resulting in lower operating costs.
|
(in thousands of $)
|
2014
|
|
|
2013
|
|
|
Change
|
|
|
Change
|
|
Administrative expenses
|
17,468
|
|
|
15,116
|
|
|
2,352
|
|
|
16
|
%
|
(in thousands of $)
|
2014
|
|
|
2013
|
|
|
Change
|
|
|
Change
|
|
Depreciation and amortization
|
49,561
|
|
|
36,562
|
|
|
12,999
|
|
|
36
|
%
|
•
|
Full year depreciation and amortization charge on the
Golar Seal
and the
Golar Celsius
in 2014 compared to approximately three months in 2013 following their delivery in October 2013; and
|
•
|
Additional depreciation and amortization charges on our newbuildings, the
Golar Igloo
delivered in February 2014 (prior to her disposal to Golar Partners in March 2014), the
Golar Crystal
delivered in May 2014, the
Golar Bear
and the
Golar Penguin
delivered in September 2014, the
Golar Glacier
and the
Golar Frost
delivered in October 2014 and the
Golar Eskimo
delivered in December 2014. There were no comparable charges in 2013.
|
•
|
Lower depreciation on the
Hilli
following the commencement of her conversion into a FLNG resulting in suspension of depreciation from July 2014. We will recommence her depreciation after completion of her conversion, which is expected to be in 2017; and
|
•
|
No depreciation and amortization expense on the
Golar Maria
following her disposal to Golar Partners in February 2013.
|
(in thousands of $)
|
2014
|
|
|
2013
|
|
|
Change
|
|
|
Change
|
|
Impairment of long-term assets
|
500
|
|
|
500
|
|
|
—
|
|
|
—
|
%
|
(in thousands of $)
|
2014
|
|
|
2013
|
|
|
Change
|
|
|
Change
|
|
Gain on disposal to Golar Partners
|
43,287
|
|
|
65,619
|
|
|
(22,332
|
)
|
|
(34
|
)%
|
(in thousands of $)
|
2014
|
|
|
2013
|
|
|
Change
|
|
|
Change
|
|
Other operating loss
|
(6,387
|
)
|
|
—
|
|
|
(6,387
|
)
|
|
100
|
%
|
(in thousands of $)
|
2014
|
|
|
2013
|
|
|
Change
|
|
|
Change
|
|
Dividend income
|
27,203
|
|
|
30,960
|
|
|
(3,757
|
)
|
|
(12
|
)%
|
(in thousands of $)
|
2014
|
|
|
2013
|
|
|
Change
|
|
|
Change
|
|
Other non-operating income (expenses)
|
281
|
|
|
(3,355
|
)
|
|
3,636
|
|
|
(108
|
)%
|
(in thousands of $)
|
2014
|
|
|
2013
|
|
|
Change
|
|
|
Change
|
|
Interest income on high-yield bonds
|
—
|
|
|
1,972
|
|
|
(1,972
|
)
|
|
(100
|
)%
|
Interest income on short-term loan to third party
|
268
|
|
|
784
|
|
|
(516
|
)
|
|
(66
|
)%
|
Other interest income
|
448
|
|
|
793
|
|
|
(345
|
)
|
|
(44
|
)%
|
Interest Income
|
716
|
|
|
3,549
|
|
|
(2,833
|
)
|
|
(80
|
)%
|
Other debt related interest expense
|
(14,474
|
)
|
|
—
|
|
|
(14,474
|
)
|
|
100
|
%
|
Interest Expense
|
(14,474
|
)
|
|
—
|
|
|
(14,474
|
)
|
|
100
|
%
|
Mark-to-market adjustment for interest rate swaps
|
(28,996
|
)
|
|
56,461
|
|
|
(85,457
|
)
|
|
(151
|
)%
|
Interest expense on undesignated interest rate swaps
|
(20,424
|
)
|
|
(10,626
|
)
|
|
(9,798
|
)
|
|
92
|
%
|
Unrealized and realized (losses) gains on interest rate swaps
|
(49,420
|
)
|
|
45,835
|
|
|
(95,255
|
)
|
|
(208
|
)%
|
Market-to-market adjustments for equity derivatives
|
(13,657
|
)
|
|
—
|
|
|
(13,657
|
)
|
|
100
|
%
|
Mark-to-market adjustments for foreign currency derivatives
|
94
|
|
|
719
|
|
|
(625
|
)
|
|
(87
|
)%
|
Financing arrangement fees and other costs
|
(7,157
|
)
|
|
(5,632
|
)
|
|
(1,525
|
)
|
|
27
|
%
|
Other
|
(3,954
|
)
|
|
(2,703
|
)
|
|
(1,251
|
)
|
|
46
|
%
|
Other Financial Items, net
|
(74,094
|
)
|
|
38,219
|
|
|
(112,313
|
)
|
|
(294
|
)%
|
(in thousands of $)
|
2014
|
|
|
2013
|
|
|
Change
|
|
|
Change
|
|
Income taxes
|
(1,114
|
)
|
|
(3,404
|
)
|
|
2,290
|
|
|
(67
|
)%
|
(in thousands of $)
|
2014
|
|
|
2013
|
|
|
Change
|
|
|
Change
|
|
Share of net earnings in Golar Partners
|
18,319
|
|
|
14,678
|
|
|
3,641
|
|
|
25
|
%
|
Share of net earnings in other affiliates
|
1,089
|
|
|
1,143
|
|
|
(54
|
)
|
|
(5
|
)%
|
|
19,408
|
|
|
15,821
|
|
|
3,587
|
|
|
23
|
%
|
(in thousands of $)
|
2014
|
|
|
2013
|
|
|
Change
|
|
|
Change
|
|
Net income attributable to non-controlling interests
|
1,655
|
|
|
—
|
|
|
1,655
|
|
|
100
|
%
|
(in thousands of $)
|
|
2014
|
|
|
2013
|
|
|
Change
|
|
|
Change
|
|
Administrative expenses
|
|
64
|
|
|
136
|
|
|
(72
|
)
|
|
(53
|
)%
|
Depreciation
|
|
250
|
|
|
309
|
|
|
(59
|
)
|
|
(19
|
)%
|
Other operating gains and losses
|
|
(1,317
|
)
|
|
—
|
|
|
(1,317
|
)
|
|
100
|
%
|
Other non-operating income
|
|
(718
|
)
|
|
—
|
|
|
(718
|
)
|
|
(100
|
)%
|
Net financial expenses
|
|
252
|
|
|
—
|
|
|
252
|
|
|
(100
|
)%
|
Net (income) loss
|
|
(1,469
|
)
|
|
445
|
|
|
(1,914
|
)
|
|
(430
|
)%
|
(in thousands, $)
|
2014
|
2013
|
Change
|
% Change
|
||||
Administrative expenses
|
(1,735
|
)
|
(7,700
|
)
|
5,965
|
|
(77
|
)%
|
Net loss
|
(1,735
|
)
|
(7,700
|
)
|
5,965
|
|
(77
|
)%
|
•
|
In April 2016, we drew down on an additional $25 million in respect of the
Tundra
lease facility with CMBL which increased the drawn down on this facility to approximately $230 million;
|
•
|
In March 2016, we completed the refinancing of the
Seal
, which provided approximately $50 million excess cash to liquidity;
|
•
|
In February 2016, we agreed to sell our equity interests in the company that is the disponent owner and operator of the FSRU, the
Golar Tundra
, pursuant to a Purchase, Sale and Contribution Agreement that we entered into with Golar Partners
.
The purchase consideration was $330.0 million for the vessel (including charter), less approximately $230.0 million of net lease obligations under the bank financing of the vessel to be assumed, and other purchase price adjustments. In connection with the execution of the purchase agreement, we received $30 million from Golar Partners as a deposit. In April 2016, Golar Partners signed a new $800.0 million senior secured credit facility, of which part of the proceeds will settle the remaining part of the cash purchase price for the acquisition of the
Golar Tundra
. Drawdown of this facility and the closing of the
Golar Tundra
transaction is expected in May 2016; and
|
•
|
In February 2016, Golar Partners made a cash distribution of $0.5775 per unit in respect of the quarter ended December 31, 2015, of which we received
$13.2 million
in relation to our interests in the common units, subordinated units, 2% general partner interest and IDRs held at the record date.
|
•
|
Payments for our FLNG conversions are made in installments in accordance with our contract with Keppel. A further $
306.1 million
of conversion payments are due within the year ended December 31, 2016. By virtue of the GoFLNG
Hilli
- pre-delivery facility we executed in September 2015 (described further below), we are able to time our drawdown on this facility with payments made, resulting in a cash neutral effect;
|
•
|
As of
April 27, 2016
, we have made $19.4 million of scheduled debt repayments during 2016. This excludes the debt repayments relating to the refinancing of the
Seal
as discussed above; and
|
•
|
During 2016 through to
April 27, 2016
, we have made dividend payments to our shareholders totaling $46.7 million in respect of the third and fourth quarters of 2015.
|
|
Year Ended December 31,
|
|||||||
|
2015
|
|
2014
|
|
2013
|
|||
(in millions of $)
|
|
|
|
|
|
|||
Net cash (used in) provided by operating activities
|
(344.6
|
)
|
|
24.9
|
|
|
67.7
|
|
Net cash used in investing activities
|
(256.0
|
)
|
|
(1,429.3
|
)
|
|
(533.1
|
)
|
Net cash provided by financing activities
|
514.4
|
|
|
1,470.5
|
|
|
166.0
|
|
Net (decrease) increase in cash and cash equivalents
|
(86.2
|
)
|
|
66.1
|
|
|
(299.4
|
)
|
Cash and cash equivalents at beginning of year
|
191.4
|
|
|
125.3
|
|
|
424.7
|
|
Cash and cash equivalents at end of year
|
105.2
|
|
|
191.4
|
|
|
125.3
|
|
•
|
newbuild installment payments of
$559.7 million
, reflecting the final installments due upon delivery of four of our newbuildings in 2015 (including the
Golar Eskimo
prior to her disposal to Golar Partners in January 2015). This contrasts to the seven newbuildings delivered in 2014 which resulted in significantly higher installment payments in 2014;
|
•
|
restricted cash net outflows of $25.3 million which is mainly attributable to the increase in the cash collateral requirements on our total return equity swap as a result of the volatility and temporary decline in the Company's share price during 2015;
|
•
|
payment of $20 million relating to the acquisition of the LNG carrier, the
LNG
Abuja
, less the proceeds of $19 million, received upon the disposal of the vessel in July 2015, resulting in an overall net cash outflow of $1 million; and
|
•
|
open market purchases of common units in Golar Partners amounting to $5 million in the third quarter of 2015.
|
•
|
an aggregate of $226.9 million cash proceeds received from Golar Partners in respect of the disposal of our 100% interests in the companies that own and operate the
Golar Eskimo
in January 2015. This provided an initial cash payment of $6.9 million. In addition, we received a further $120 million in June 2015, with the balance of $100 million received in November 2015, in connection with the vendor bridging financing we provided to Golar Partners at the time of the sale;
|
•
|
Net proceeds of $207.4 million received from the sale of 7,170,000 Golar Partners common units in a secondary offering in January 2015; and
|
•
|
receipts of $20 million from Golar Partners in settlement and expiry of the short-term revolving credit facility granted at the time of Golar Partners’ IPO.
|
•
|
higher installment payments made in respect of our newbuilds, following the delivery of seven newbuilds (including the
Golar
Igloo
prior to her disposal to Golar Partners in March 2014);
|
•
|
milestone payments of $313.6 million relating to the FLNG conversion of the
Hilli
;
|
•
|
payments to other long-term assets of $49.9 million relating to long lead items ordered in preparation for the conversion of the
Gimi
to a FLNG;
|
•
|
increases in restricted cash and short-term receivables of $48.0 million primarily due to cash collateral provided against our total return equity swap we entered into in December 2014; and
|
•
|
a short-term loan of $20 million we granted to Golar Partners.
|
•
|
installment payments of $733.4 million made in respect of our newbuilds;
|
•
|
net increases to our restricted cash and short-term receivables of $25.0 million which was mainly attributable to performance bonds for certain projects awarded to us in 2013;
|
•
|
granting of a short-term loan to a third party of $12.0 million, of which $2.5 million was repaid in 2013;
|
•
|
consideration of $119.9 million received from Golar Partners in respect of the sale of
Golar Maria
in February 2013;
|
•
|
proceeds of $99.2 million from the partial sale of our interest in the Golar Partners common units in December 2013; and
|
•
|
proceeds of $34.5 million from the disposal of our high-yield bond participation in Golar Partners.
|
•
|
aggregate proceeds of $738.8 million drawn down by our lessor VIEs under their respective loan arrangements to fund the final installments due upon delivery of our four newbuildings (
Golar Kelvin, Golar Snow, Golar Ice
and
Golar Tundra
), less payment of related financing costs of $13.2 million;
|
•
|
proceeds of $62.5 million from the new Golar Viking (2015) facility, which we entered into upon repossession of the
Golar Viking
from Equinox in December 2015;
|
•
|
proceeds of $50 million from a related party in November 2015 under a short-term, interest bearing credit facility (we repaid the outstanding balance of $50 million in December 2015); and
|
•
|
proceeds of $50 million representing the first draw down of the GoFLNG Hilli pre-delivery facility for the reimbursement of FLNG conversion costs already paid.
|
•
|
loan repayments of $165.4 million (excluding the amounts repaid under the related party $50 million short-term credit facility referred to above). Of this amount, $82 million relates to the settlement of the balance outstanding on the Viking loan facility of $82 million in preparation of the sale of the vessel in February 2015 to Equinox;
|
•
|
payment of dividends of $121.4 million;
|
•
|
net cash outflows of restricted cash of $32.3 million, representing primarily cash balances as held by ICBC or CMBL VIE lessors, which we are required to consolidate as VIEs under US GAAP (refer to note 4 "Variable Interest Entities" to the Consolidated Financial Statements contained herein); and
|
•
|
purchases of treasury shares in the Company amounting to an aggregate cost of $12.3 million.
|
•
|
$841.5 million drawn down under our $1.125 billion facility to fund the final installment payments of the
Golar Igloo, Golar Crystal, Golar Penguin, Golar Bear, Golar Frost and Golar Eskimo
less payment of $18.7 million of related financing costs. The debt in relation to the
Golar Igloo
was assumed by Golar Partners on its acquisition of the company that owns and operates the vessel in March 2014. The debt in relation to the
Golar Eskimo
was classified under liabilities held-for-sale in our consolidated balance sheet;
|
•
|
net proceeds of $660.9 million received from our June 2014 equity offering of 12,650,000 shares of our common stock, which included 1,650,000 common shares purchased pursuant to the Underwriters' option to purchase additional common shares. The issue price was $54.0 per share;
|
•
|
$185.6 million drawn down under ICBC finance leasing arrangement to fund the final installment payment of the
Golar Glacier
by its owner, 1401 Limited;
|
•
|
proceeds from the new Golar Arctic facility of $87.5 million, which was used to repay the existing Golar Arctic facility due in January 2015;
|
•
|
$67.6 million draw down from the short term facility to fund the LNG cargo trade during the first quarter of 2014. This was paid subsequently in April 2014 with the receipt of $71.6 million upon settlement of the related LNG cargo trade receivable; and
|
•
|
proceeds of $40.6 million as shareholder loans from KSI and B&V to fund the
Hilli
conversion.
|
•
|
payment of dividends during the year of $156.0 million; and
|
•
|
repayment of short-term and long-term debts (including debt due to related party) of $239.9 million.
|
•
|
$256.4 million draw down in respect of our $1.125 billion facility to fund the final installment payments of the
Golar Seal
and
Golar Celsius
delivered in October 2013;
|
•
|
$50.0 million drawdown on our World Shipholding revolving credit facility;
|
•
|
payment of dividends during the year of $109.0 million;
|
•
|
payment of financing costs of $22.6 million in respect of our $1.125 billion facility entered into July 2013; and
|
•
|
scheduled repayments of $9.4 million on our long-term debt.
|
(in thousands of $)
|
2015
|
|
|
Maturity date
|
Golar Arctic facility
|
80,200
|
|
|
2019
|
Convertible bonds
|
243,369
|
|
|
2017
|
Hilli shareholder loans:
|
|
|
|
|
- Keppel loan
|
44,066
|
|
|
2027
|
- B&V loan
|
5,000
|
|
|
2027
|
GoFLNG Hilli facility
|
50,000
|
|
|
2017
|
Golar Viking (2015)
|
62,500
|
|
|
2020
|
$1.125 billion facility:
|
|
|
|
|
- Golar Seal facility
|
106,612
|
|
|
2018/2025*
|
- Golar Celsius facility
|
107,020
|
|
|
2018/2025*
|
- Golar Crystal facility
|
111,941
|
|
|
2019/2026*
|
- Golar Penguin facility
|
118,144
|
|
|
2019/2026*
|
- Golar Bear facility
|
118,524
|
|
|
2019/2026*
|
- Golar Frost facility
|
120,357
|
|
|
2019/2026*
|
Subtotal
|
1,167,733
|
|
|
|
ICBC VIE loans:
|
|
|
|
|
- Golar Glacier facility
|
177,176
|
|
|
2016/2024**
|
- Golar Snow facility
|
178,566
|
|
|
2016/2025**
|
- Golar Kelvin facility
|
182,540
|
|
|
**
|
- Golar Ice facility
|
172,046
|
|
|
**
|
|
1,878,061
|
|
|
|
Tranche
|
Amount
|
Proportion of facility
|
Term of loan from date of drawdown
|
Repayment terms
|
K-Sure
|
$449.0 million
|
40%
|
12 years
|
Six-monthly installments
|
KEXIM
|
$450.0 million
|
40%
|
12 years
|
Six-monthly installments
|
Commercial
|
$226.0 million
|
20%
|
5 years
|
Six-monthly installments, unpaid balance to be refinanced after 5 years
|
Date of drawdown
|
Vessel
|
$1.125 billion facility
|
Amount drawn down
|
October 2013
|
Golar Seal*
|
$133.2 million
|
$127.9 million
|
October 2013
|
Golar Celsius
|
$133.2 million
|
$128.4 million
|
May 2014
|
Golar Crystal
|
$133.2 million
|
$127.9 million
|
September 2014
|
Golar Penguin
|
$133.2 million
|
$128.9 million
|
September 2014
|
Golar Bear
|
$133.2 million
|
$129.3 million
|
October 2014
|
Golar Frost
|
$134.8 million
|
$131.3 million
|
February 2014
|
Golar Igloo**
|
$161.3 million
|
$161.3 million
|
December 2014
|
Golar Eskimo***
|
$162.8 million
|
$162.8 million
|
As at December 31, 2015
|
|
$1.125 billion
|
$1.098 billion
|
(in thousands of $)
|
April 27, 2016
|
|
Payable within 8 months to December 31, 2016
|
211,134
|
|
Payable within 2017
|
374,375
|
|
|
585,509
|
|
(in millions of $)
|
April 27, 2016
|
|
Payable within 8 months to December 31, 2016
|
30.9
|
|
Payable within 2017
|
185.6
|
|
|
216.5
|
|
•
|
Cash flows are assumed to be in line with pre-existing contracts and are utilized based on historical performance levels and knowledge of similar agreements with other vessels in our fleet;
|
•
|
For our LNG carriers, once the initial contract period expires, we have estimated cash flows at the lower of our estimated current long-term charter rate or option renewal rate with the existing counterparty; where offhire, we have considered estimated future utilization levels based on historical knowledge;
|
•
|
We have made certain assumptions in relation to the scrap values of our vessels at the end of their useful lives; and
|
•
|
For our LNG carriers that are currently in lay-up but designated for conversion to FLNGs, we have based our estimates upon the results of our feasibility study and projects under the assumption that these vessels will be utilized as FSUs until they meet the criteria to be classified as assets under development and estimates will be according to our understanding of the future FLNG economics, which include assumptions such as pricing and volume, operating cost, and levels of future capital investment.
|
•
|
Management, having the authority to approve the action, commits to a plan to sell the entity to be sold;
|
•
|
The entity to be sold is available for immediate sale in its present condition, subject only to terms that are usual and customary for sales of such entities to be sold;
|
•
|
An active program to locate a buyer or buyers and other actions required to complete the plan to sell the entity to be sold have been initiated;
|
•
|
The sale of the entity to be sold is probable, and transfer of the entity to be sold is expected to qualify for recognition as a completed sale within one year (some exceptions may apply);
|
•
|
The entity to be sold is being actively marketed for sale at a price that is reasonable in relation to its current fair value;
|
•
|
Actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn.
|
•
|
modify the evaluation of whether limited partnerships and similar legal entities are variable interest entities (VIEs) or voting interest entities;
|
•
|
eliminate the presumption that a general partner should consolidate a limited partnership;
|
•
|
affect the consolidation analysis of reporting entities that are involved with VIEs, particularly those that have fee arrangements and related party relationships; and
|
•
|
provide a scope exception from consolidation guidance for reporting entities with interest in legal entities that are required to comply with or operate in accordance with requirements that are similar to those in Rule 2a-7 of the Investment Company Act of 1940 for registered money market funds.
|
(in millions of $)
|
Total
Obligation
|
|
|
Due in 2016
|
|
|
Due in 2017 – 2018
|
|
|
Due in 2019 – 2020
|
|
|
Due Thereafter
|
|
Long-term and short-term debt
|
1,878.1
|
|
|
501.6
|
|
|
481.0
|
|
|
270.1
|
|
|
625.4
|
|
Interest commitments on long-term debt and other interest rate swaps
(1)
|
396.4
|
|
|
82.3
|
|
|
128.5
|
|
|
90.1
|
|
|
95.5
|
|
Operating lease obligations
(2)
|
52.4
|
|
|
27.7
|
|
|
24.0
|
|
|
0.7
|
|
|
—
|
|
Purchase obligations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Newbuilding
(3)
|
235.1
|
|
|
49.5
|
|
|
185.6
|
|
|
—
|
|
|
—
|
|
Egyptian Venture
(4)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
FLNG conversion
(5)
|
680.5
|
|
|
306.1
|
|
|
374.4
|
|
|
—
|
|
|
—
|
|
Other long-term liabilities
(6)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Total
|
3,242.5
|
|
|
967.2
|
|
|
1,193.5
|
|
|
360.9
|
|
|
720.9
|
|
(1)
|
Our interest commitment on our long-term debt is calculated based on an assumed average USD LIBOR of 1.72% and taking into account our various margin rates and interest rate swaps associated with each debt.
|
(2)
|
The above table includes operating lease payments to Golar Partners relating to the Option Agreement entered into in connection with the disposal of the
Golar Grand
in November 2012. Under the Option Agreement, in the event that the charterer does not renew or extend its charter beyond February 2015, Golar Partners has the option to require us to charter the vessel through to October 2017. Golar Partners exercised this option in February 2015.
|
(3)
|
The total contract cost of our newbuilding was approximately $247.5 million of which, as of December 31, 2015, $235.1 million remains payable in 2016 and 2017.
|
(4)
|
As at December 31, 2015, we had a commitment to pay $1.0 million to an unrelated third party, contingent upon the conclusion of a material commercial business transaction by the Egyptian Natural Gas Holding Company, or ECGS, as consideration for work performed in connection with the setting up and incorporation of ECGS. This liability has been excluded from the above table, as the timing of any cash payment is uncertain.
|
(5)
|
This refers to our committed costs for the completion of the conversion of the
Hilli
into a FLNG. It does not include the
Gimi
and the
Gandria
since these vessels have not yet entered into conversion and we have an option to terminate these contracts for a defined fee.
|
(6)
|
Our Consolidated Balance Sheet as of December 31, 2015, includes
$69.2 million
classified as "Other long-term liabilities" of which
$36.3 million
represents liabilities under our pension plans and
$16.5 million
represents other guarantees provided to Golar Partners. These liabilities have been excluded from the above table as the timing and/or the amount of any cash payment is uncertain. See note 3 ''Other Long-Term Liabilitie'' to our Consolidated Financial Statements included herein for additional information regarding our other long-term liabilities.
|
Name
|
|
Age
|
|
Position
|
Daniel Rabun
|
|
61
|
|
Chairman of our board of directors, director, Audit Committee member and Nomination Committee member
|
Tor Olav Trøim
|
|
53
|
|
Director
|
Fredrik Halvorsen
|
|
42
|
|
Director
|
Carl Steen
|
|
65
|
|
Director, Audit Committee member, Compensation Committee member and Nomination Committee member
|
Niels Stolt-Nielsen
|
|
51
|
|
Director and Compensation Committee member
|
Lori Wheeler Naess
|
|
45
|
|
Director and Audit Committee Chairperson
|
Andrew Whalley
|
|
49
|
|
Director and Company Secretary
|
Name
|
|
Age
|
|
Position
|
Gary Smith
|
|
61
|
|
Chief Executive Officer – Golar Management
|
Oistein Dahl
|
|
55
|
|
Chief Operating Officer and Managing Director of GWM
|
Brian Tienzo
|
|
42
|
|
Chief Financial Officer – Golar Management
|
Hugo Skår
|
|
48
|
|
Chief Technical Officer – Golar Management
|
Director or Officer
|
Beneficial Interest in
Common Shares
|
|
Interest in Options
|
|
|
|||||||||
|
Number of shares
|
|
%
|
|
|
Total
number of
options
|
|
Exercise price
|
|
Expiry date
|
||||
Tor Olav Trøim
|
(1)(2)
|
|
|
(1)(2)
|
|
|
8,251
|
|
|
$
|
5.58
|
|
|
2016
|
|
|
|
|
|
2,750
|
|
|
$
|
1.58
|
|
|
2016
|
||
|
|
|
|
|
150,000
|
|
|
$
|
56.20
|
|
|
2019
|
||
Fredrik Halvorsen
|
*
|
|
|
*
|
|
|
—
|
|
|
$
|
—
|
|
|
|
Niels Stolt-Nielsen
|
2,241,813
|
|
|
2.4
|
%
|
|
—
|
|
|
$
|
—
|
|
|
|
Brian Tienzo
|
—
|
|
|
—
|
|
|
11,797
|
|
|
$
|
5.58
|
|
|
2016
|
|
|
|
|
|
6,766
|
|
|
$
|
1.58
|
|
|
2016
|
||
|
|
|
|
|
8,000
|
|
|
$
|
56.20
|
|
|
2020
|
||
|
|
|
|
|
125,000
|
|
|
$
|
56.20
|
|
|
2019
|
||
Oistein Dahl
|
—
|
|
|
—
|
|
|
25,000
|
|
|
$
|
24.55
|
|
|
2016
|
|
|
|
|
|
6,100
|
|
|
$
|
56.20
|
|
|
2020
|
||
|
|
|
|
|
75,000
|
|
|
$
|
56.20
|
|
|
2019
|
||
Hugo Skar
|
—
|
|
|
—
|
|
|
100,000
|
|
|
$
|
56.20
|
|
|
2019
|
|
|
|
|
|
6,100
|
|
|
$
|
56.20
|
|
|
2020
|
||
Gary Smith
|
—
|
|
|
—
|
|
|
150,000
|
|
|
$
|
56.65
|
|
|
2020
|
|
|
|
|
|
18,300
|
|
|
$
|
56.20
|
|
|
2020
|
|
|
|
|
||
|
|
Common Shares
|
|||
Owner
|
|
Number
|
Percent
|
||
FMR LLC
(1)
|
|
9,327,961
|
|
9.97
|
%
|
Luxor Capital Group, L.P.
(2)
|
|
9,229,350
|
|
9.87
|
%
|
Capital Research Global Investors
(3)
|
|
8,837,000
|
|
9.45
|
%
|
Barrow, Hanley, Mewhinney and Strauss, LLC
(4)
|
|
5,599,472
|
|
5.99
|
%
|
(in thousands of $)
|
|
2015
|
|
|
Management and administrative services fees revenue (i)
|
|
2,949
|
|
|
Ship management fees revenue (ii)
|
|
7,577
|
|
|
Charter-hire expenses (iii)
|
|
(41,555
|
)
|
|
Gain on disposals to Golar Partners (iv)
|
|
102,406
|
|
|
Interest income on vendor financing loan (v)
|
|
4,217
|
|
|
Interest expense on short-term credit facility
|
|
(203
|
)
|
|
Share options expense recharge (viii)
|
|
297
|
|
|
Total
|
|
75,688
|
|
|
(in thousands of $)
|
|
2015
|
|
|
Trading balances owing to Golar Partners and affiliates (vi)
|
|
(4,400
|
)
|
|
Methane Princess lease security deposits movements (vii)
|
|
(2,728
|
)
|
|
|
|
(7,128
|
)
|
|
•
|
first
, 98.0% to all unit holders, pro rata, and 2.0% to the General Partner, until each unit holder receives a total of $0.4428 per unit for that quarter, or the first target distribution;
|
•
|
second
, 85.0% to all unit holders, pro rata, 2.0% to the General Partner and 13.0% to the holders of the IDRs, pro rata, until each unit holder receives a total of $0.4813 per unit for that quarter (the "second target distribution'');
|
•
|
third
, 75.0% to all unit holders, pro rata, 2.0% to the General Partner and 23.0% to the holders of the IDRs pro rata, until each unit holder receives a total of $0.5775 per unit for that quarter, or the third target distribution; and
|
•
|
thereafter
, 50.0% to all unit holders, pro rata, 2.0% to the General Partner and 48.0% to the holders of the IDRs, pro rata.
|
(in thousands of $)
|
2015
|
|
Golar Wilhelmsen
|
(2,246
|
)
|
|
|
|
|
|
Nasdaq
|
||||||
|
|
|
|
|
High
|
|
|
Low
|
|
||
Year ended December 31
|
|
|
|
|
|
|
|
||||
2015
|
|
|
|
|
$
|
51.89
|
|
|
$
|
13.50
|
|
2014
|
|
|
|
|
$
|
74.44
|
|
|
$
|
31.21
|
|
2013
|
|
|
|
|
$
|
41.55
|
|
|
$
|
30.51
|
|
2012
|
|
|
|
|
$
|
47.82
|
|
|
$
|
31.71
|
|
2011
|
|
|
|
|
$
|
45.59
|
|
|
$
|
14.77
|
|
|
|
|
Nasdaq
|
||||||||
|
|
|
|
|
High
|
|
|
Low
|
|
||
Quarter ended
|
|
|
|
|
|
|
|
||||
Second quarter 2016
(1)
|
|
|
|
|
$
|
24.67
|
|
|
$
|
16.68
|
|
First quarter 2016
|
|
|
|
|
$
|
21.53
|
|
|
$
|
9.42
|
|
Fourth quarter 2015
|
|
|
|
|
$
|
34.69
|
|
|
$
|
13.50
|
|
Third quarter 2015
|
|
|
|
|
$
|
50.00
|
|
|
$
|
25.52
|
|
Second quarter 2015
|
|
|
|
|
$
|
51.89
|
|
|
$
|
32.97
|
|
First quarter 2015
|
|
|
|
|
$
|
37.24
|
|
|
$
|
27.72
|
|
Fourth quarter 2014
|
|
|
|
|
$
|
67.17
|
|
|
$
|
31.21
|
|
Third quarter 2014
|
|
|
|
|
$
|
74.44
|
|
|
$
|
57.55
|
|
Second quarter 2014
|
|
|
|
|
$
|
60.39
|
|
|
$
|
39.93
|
|
First quarter 2014
|
|
|
|
|
$
|
43.94
|
|
|
$
|
33.35
|
|
•
|
If he becomes of unsound mind or a patient for any purpose of any statute or applicable law relating to mental health and the Board resolves that he shall be removed from office;
|
•
|
If he becomes bankrupt or compounds with his creditors;
|
•
|
If he is prohibited by law from being a Director; or
|
•
|
If he ceases to be a Director by virtue of the Companies Act.
|
•
|
we will not be able to pay our liabilities as they fall due; or
|
•
|
the realizable value of our assets is less than our liabilities.
|
1.
|
Rules of Golar LNG Limited Bermuda Employee Share Option Scheme.
|
2.
|
Omnibus Agreement dated April 13, 2011, by and among Golar LNG Ltd., Golar LNG Partners LP, Golar GP LLC and Golar Energy Limited.
|
3.
|
Amendment No. 1 to Omnibus Agreement, dated October 5, 2011 by and among Golar LNG Ltd., Golar LNG Partners LP, Golar GP LLC and Golar Energy Limited.
|
4.
|
Bermuda Tax Assurance, dated May 23, 2011.
|
5.
|
Bond Agreement dated March 5, 2012 between Golar LNG Ltd and Norsk Tillitsmann ASA as bond trustee.
|
6.
|
First Amended and Restated Agreement of Limited Partnership of Golar LNG Partners LP.
|
7.
|
Purchase, Sale and Contribution Agreement, dated December 15, 2014, by and among Golar LNG Partners LP, Golar Partners Operating LLC and Golar LNG Ltd., providing for, among other things, the sale of the
Golar Eskimo
.
|
8.
|
Memorandum of Agreement, dated December 19, 2014, by and between Golar LNG 1460 Corporation and
P
T Perusahaan Pelayaran Equinox
, providing for, among other things, the sale of the
Golar Viking
.
|
9.
|
Engineering, Procurement and Construction Contract, dated May 22, 2014 by and between Golar Hilli Corporation and Keppel Shipyard Limited.
|
10.
|
Engineering, Procurement and Construction Contract, dated October 27, 2014 by and between Golar Gimi Corporation and Keppel Shipyard Limited.
|
11.
|
Facilities Agreement, by and among Golar Hull M2021 Corp, Golar Hull M2026 Corp, Golar Hull M2031 Corp, Golar Hull M2022 Corp, Golar Hull M2023 Corp, Golar Hull M2027 Corp, Golar Hull M2024 Corp, Golar LNG NB 12 Corporation, and a consortium of banks for a $1.125 billion facility, dated July 25, 2013.
|
12.
|
Supplemental Agreement between Golar Hull M2021 Corp, Golar Hull M2026 Corp, Golar Hull M2031 Corp, Golar Hull M2022 Corp, Golar Hull M2023 Corp, Golar Hull M2027 Corp, Golar Hull M2024 Corp, Golar LNG NB 12 Corporation, and a consortium of banks for $1.125 billion facility, dated October 1, 2013.
|
13.
|
Second Supplemental Agreement between Golar Hull M2021 Corp, Golar Hull M2026 Corp, Golar Hull M2031 Corp, Golar Hull M2022 Corp, Golar Hull M2023 Corp, Golar Hull M2027 Corp, Golar Hull M2024 Corp, Golar LNG NB 12 Corporation, and a consortium of banks for $1.125 billion facility, dated August 28, 2014.
|
14.
|
Third Supplemental Agreement between Golar Hull M021 Corp, Golar Hull M026 Corp, Golar Hull M2031 Corp, Golar Hull M2022 Corp, Golar Hull M2023 Corp, Golar Hull M2027 Corp, Golar Hull M2024 Corp, Golar LNG NB 12 Corporation, and a consortium of banks for $1.125 billion facility, dated December 11, 2014.
|
15.
|
Letter Agreement, dated as of January 20, 2015, by and between Golar LNG Limited and Golar LNG Partners LP.
|
16.
|
Loan Agreement, dated as of January 20, 2015, by and between Golar LNG Limited and Golar LNG Partners LP.
|
17.
|
Loan Agreement related to $20.0 Million Revolving Credit Facility dated April 11, 2011 by and between Golar LNG Limited and Golar LNG Partners LP.
|
18.
|
Supplemental Deed by and between Golar LNG Partners LP and Golar LNG Limited for the $20 million Revolving Credit Facility dated as of April 29, 2015.
|
19.
|
LNG Time Charter Party, dated May 27, 2015, by and between Golar Grand Corporation and Golar Trading Corporation.
|
20.
|
Engineering, Procurement and Construction Contract, dated July 21, 2015 by and between Golar Gandria N.V. and Keppel Shipyard Limited.
|
21.
|
Memorandum of Agreement, dated September 9, 2015, by and between Golar Hilli Corporation and Fortune Lianjing Shipping S.A.
|
22.
|
Pre-delivery Financing Agreement related to the Hilli conversion dated September 9, 2015 by and between Fortune Lianjing Shipping S.A. and Golar Hilli Corporation.
|
23.
|
Purchase, Sale and Contribution Agreement, dated February 10, 2016, by and between Golar Partners Operating LLC and Golar LNG Ltd, providing for, among other things, the sale of the
Golar Tundra
.
|
24.
|
First Amended and Restated Management and Administrative Services Agreement, effective as of July 1, 2011, between Golar LNG Partners LP and Golar Management Limited.
|
•
|
we and each subsidiary are organized in a "qualified foreign country," defined as a country that grants an equivalent exemption from tax to corporations organized in the United States in respect of the shipping income for which exemption is being claimed under section 883 of the Code; this is also known as the "Country of Organization Requirement"; and
|
•
|
either
|
•
|
more than 50% of the value of our stock is treated as owned, directly or indirectly, by individuals who are "residents" of qualified foreign countries; this is also known as the "Ownership Requirement"; or
|
•
|
our stock is "primarily and regularly traded on an established securities market" in the United States or any qualified foreign country; this is also known as the "Publicly-Traded Requirement".
|
•
|
at least 75% of our gross income in a taxable year is "passive income"; or
|
•
|
at least 50% of our assets in a taxable year (averaged over the year and generally determined based upon value) are held for the production of, or produce, "passive income."
|
•
|
fails to provide an accurate taxpayer identification number;
|
•
|
provides us with an incorrect taxpayer identification number;
|
•
|
is notified by the IRS that it has failed to report all interest or dividends required to be shown on its U.S. federal income tax returns; or
|
•
|
in certain circumstances, fails to comply with applicable certification requirements.
|
•
|
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;
|
•
|
provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and
|
•
|
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.
|
Fiscal year ended December 31, 2015
|
$
|
1,259,082
|
|
Fiscal year ended December 31, 2014
|
$
|
1,046,950
|
|
Fiscal year ended December 31, 2015
|
$
|
—
|
|
Fiscal year ended December 31, 2014
|
$
|
—
|
|
Fiscal year ended December 31, 2015
|
$
|
335,853
|
|
Fiscal year ended December 31, 2014
|
$
|
660,419
|
|
Fiscal year ended December 31, 2015
|
$
|
—
|
|
Fiscal year ended December 31, 2014
|
$
|
—
|
|
Month of repurchase
|
Total number of shares purchased
|
|
|
Average price paid per share
|
|
|
Total number of shares purchased as part of publicly announced plans or programme
|
|
|
Maximum number of shares that may be purchased under the plans or programme
|
|
|
October 2015
|
300,000
|
|
|
$
|
40.90
|
|
|
300,000
|
|
|
4,400,000
|
|
As of December 31, 2015
|
300,000
|
|
|
|
|
300,000
|
|
|
4,400,000
|
|
Number
|
Description of Exhibit
|
1.1**
|
Memorandum of Association of Golar LNG Limited as adopted on May 9, 2001, incorporated by reference to Exhibit 1.1 of the Company's Registration Statement on Form 20-F, filed with the SEC on November 27, 2002, File No. 00050113, or the Original Registration Statement.
|
1.2**
|
Bye-Laws of Golar LNG Limited amended and adopted September 20, 2013, incorporated by reference to Exhibit 3.1 to the Company's Report of Foreign Issuer on Form 6-K filed on July 1, 2014.
|
1.3**
|
Certificate of Incorporation as adopted on May 10, 2001, incorporated by reference to Exhibit 1.3 of the Company's Original Registration Statement.
|
1.4**
|
Certificate of deposit of memorandum of increase of share capital of Golar LNG Limited registered on June 20, 2001 (increasing the Company's authorized capital), incorporated by reference to Exhibit 1.4 of the Company's Original Registration Statement.
|
1.5**
|
Certificate of deposit of memorandum of increase of share capital of Golar LNG Limited registered November 6, 2014, incorporated by reference to Exhibit 1.6 of Golar LNG Limited Annual Report on Form 20-F for the fiscal year ended December 31, 2014.
|
2.1**
|
Form of share certificate incorporated by reference to Exhibit 2.1 of the Company's Annual Report on Form 20-F for the fiscal year ended December 31, 2010.
|
4.1**
|
Rules of the Bermuda Employee Share Option Scheme, incorporated by reference to Exhibit 4.6 of the Company's Original Registration Statement.
|
4.2**
|
Omnibus Agreement dated April 13, 2011, by and among Golar LNG Ltd., Golar LNG Partners LP, Golar GP LLC and Golar Energy Limited, incorporated by reference to Exhibit 4.2* of Golar LNG Partners L.P. Annual Report on Form 20-F for the fiscal year ended December 31, 2011.
|
4.3**
|
Amendment No. 1 to Omnibus Agreement, dated October 5, 2011 by and among Golar LNG Ltd., Golar LNG Partners LP, Golar GP LLC and Golar Energy Limited, incorporated by reference to Exhibit 4.2(a)* of Golar LNG Partners L.P. Annual Report on Form 20-F for the fiscal year ended December 31, 2011.
|
4.4**
|
Bermuda Tax Assurance, dated May 23, 2011, incorporated by reference to Exhibit 4.4 of the Company's Annual Report on Form 20-F for the fiscal year ended December 31, 2013.
|
4.5**
|
Bond Agreement dated March 5, 2012 between Golar LNG Ltd and Norsk Tillitsmann ASA as bond trustee, incorporated by reference to Exhibit 4.6 of Golar LNG Limited Annual Report on Form 20-F for the fiscal year ended December 31, 2012.
|
4.6**
|
First Amended and Restated Agreement of Limited Partnership of Golar LNG Partners LP, incorporated by reference to Exhibit 1.2 of Golar LNG Partners L.P. Annual Report on Form 20-F for the fiscal year ended December 31, 2011.
|
4.7**
|
Purchase, Sale and Contribution Agreement, dated December 15, 2014, by and among Golar LNG Partners LP, Golar Partners Operating LLC and Golar LNG Ltd., providing for, among other things, the sale of the
Golar Eskimo,
incorporated by reference to Exhibit 4.9 of Golar LNG Limited Annual Report on Form 20-F for the fiscal year ended December 31, 2014.
|
4.8**
|
Memorandum of Agreement, dated December 19, 2014, by and between Golar LNG 1460 Corporation and
P
T Perusahaan Pelayaran Equinox
, providing for, among other things, the sale of the
Golar Viking,
incorporated by reference to Exhibit 4.10 of Golar LNG Limited Annual Report on Form 20-F for the fiscal year ended December 31, 2014.
|
4.9**
|
Engineering, Procurement and Construction Contract, dated May 22, 2014 by and between Golar Hilli Corporation and Keppel Shipyard Limited, incorporated by reference to Exhibit 5.1 to the registrant’s Report of Foreign Issuer on Form 6-K filed on September 4, 2014.
|
4.10**
|
Engineering, Procurement and Construction Contract, dated October 27, 2014 by and between Golar Gimi Corporation and Keppel Shipyard Limited, incorporated by reference to Exhibit 4.12 of Golar LNG Limited Annual Report on Form 20-F for the fiscal year ended December 31, 2014.
|
4.11**
|
Facilities Agreement by and among Golar Hull M2021 Corp, Golar Hull M2026 Corp, Golar Hull M2031 Corp, Golar Hull M2022 Corp, Golar Hull M2023 Corp, Golar Hull M2027 Corp, Golar Hull M2024 Corp, Golar LNG NB 12 Corporation, and a consortium of banks for a $1.125 billion facility, dated July 25, 2013, incorporated by reference to Exhibit 4.9 of Golar LNG Limited Annual Report on Form 20-F for the fiscal year ended December 31, 2013.
|
4.12**
|
Supplemental Agreement between Golar Hull M2021 Corp, Golar Hull M2026 Corp, Golar Hull M2031 Corp, Golar Hull M2022 Corp, Golar Hull M2023 Corp, Golar Hull M2027 Corp, Golar Hull M2024 Corp, Golar LNG NB 12 Corporation, and a consortium of banks for $1.125 billion facility, dated October 1, 2013, incorporated by reference to Exhibit 4.14 of Golar LNG Limited Annual Report on Form 20-F for the fiscal year ended December 31, 2014.
.
|
4.13**
|
Second Supplemental Agreement, by and among Golar Hull M2021 Corp, Golar Hull M2026 Corp, Golar Hull M2031 Corp, Golar Hull M2022 Corp, Golar Hull M2023 Corp, Golar Hull M2027 Corp, Golar Hull M2024 Corp, Golar LNG NB 12 Corporation, and a consortium of banks for $1.125 billion facility, dated August 28, 2014, incorporated by reference to Exhibit 4.15 of Golar LNG Limited Annual Report on Form 20-F for the fiscal year ended December 31, 2014.
|
4.14**
|
Third Supplemental Agreement between Golar Hull M2021 Corp, Golar Hull M2026 Corp, Golar Hull M2031 Corp, Golar Hull M2022 Corp, Golar Hull M2023 Corp, Golar Hull M2027 Corp, Golar Hull M2024 Corp, Golar LNG NB 12 Corporation, and a consortium of banks for $1.125 billion facility, dated December 11, 2014, incorporated by reference to Exhibit 4.16 of Golar LNG Limited Annual Report on Form 20-F for the fiscal year ended December 31, 2014.
|
4.15**
|
Letter Agreement, dated as of January 20, 2015, by and between Golar LNG Partners LP and Golar LNG Limited, incorporated by reference to Exhibit 4.17 of Golar LNG Limited Annual Report on Form 20-F for the fiscal year ended December 31, 2014.
|
4.16**
|
Loan Agreement, dated as of January 20, 2015, by and between Golar LNG Partners LP and Golar LNG Limited, incorporated by reference to Exhibit 4.18 of Golar LNG Limited Annual Report on Form 20-F for the fiscal year ended December 31, 2014.
|
4.17**
|
Loan Agreement related to $20.0 Million Revolving Credit Facility dated April 11, 2011 by and between Golar LNG Limited and Golar LNG Partners LP, incorporated by reference to Exhibit 4.19 of Golar LNG Limited Annual Report on Form 20-F for the fiscal year ended December 31, 2014.
|
4.18**
|
Supplemental Deed by and between Golar LNG Partners LP and Golar LNG Limited for the $20 million Revolving Credit Facility dated as of April 29, 2015, incorporated by reference to Exhibit 4.20 of Golar LNG Limited Annual Report on Form 20-F for the fiscal year ended December 31, 2014.
|
4.19**
|
LNG Time charter party dated May 27, 2015 between Golar Grand Corporation and Golar Trading Corporation, incorporated by reference to Exhibit 4.1 to the registrant’s Report of Foreign Issuer on Form 6-K filed on August 13, 2015.
|
4.20*
|
Engineering, Procurement and Construction Contract, dated July 21, 2015 by and between Golar Gandria N.V. and Keppel Shipyard Limited.
|
4.21*
|
Memorandum of Agreement, dated September 9, 2015, by and between Golar Hilli Corporation and Fortune Lianjing Shipping S.A., providing for, among other things, the sale and leaseback of the
Hilli.
|
4.22**
|
Pre-delivery Financing Agreement related to the Hilli conversion dated September 9, 2015 by and between Fortune Lianjing Shipping S.A. and Golar Hilli Corporation, incorporated by reference to Exhibit 4.2 to the registrant’s Report of Foreign Issuer on Form 6-K filed on December 24, 2015.
|
4.23*
|
Purchase, Sale and Contribution Agreement, dated February 10, 2016, by and between Golar Partners Operating LLC and Golar LNG Ltd., providing for, among other things, the sale of the
Golar Tundra
.
|
4.24**
|
First Amended and Restated Management and Administrative Services Agreement, effective as of July 1, 2011, between Golar LNG Partners LP and Golar Management Limited (incorporated by reference to the Exhibit 4.3 of the Partnership's Annual Report on Form 20-F for fiscal year ended December 31, 2011)
|
8.1*
|
Golar LNG Limited subsidiaries.
|
11.1**
|
Golar LNG Limited Corporate Code of Business Ethics and Conduct, incorporated by reference to Exhibit 14.1 of the Company's Annual Report on Form 20-F for the year ended December 31, 2003.
|
12.1*
|
Certification of the Principal Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002.
|
12.2*
|
Certification of the Principal Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002.
|
13.1*
|
Certification under Section 906 of the Sarbanes-Oxley act of 2002 of the Principal Executive Officer.
|
13.2*
|
Certification under Section 906 of the Sarbanes-Oxley act of 2002 of the Principal Financial Officer.
|
15.1*
|
Consent of Independent Registered Public Accounting Firm - Ernst & Young LLP.
|
15.2*
|
Consent of Independent Registered Public Accounting Firm - PricewaterhouseCoopers LLP.
|
99.1*
|
Letter from PricewaterhouseCoopers LLP addressed to the SEC regarding the disclosure provided in Item 16F.
|
|
Golar LNG Limited
|
||
|
(Registrant)
|
||
|
|
||
Date
|
April 29, 2016
|
By
|
/s/ Brian Tienzo
|
|
|
Brian Tienzo
|
|
|
|
Principal Financial and Accounting Officer
|
|
Page
|
Audited Consolidated Statements of Operations for the years ended December 31,
2015, 2014 and 2013
|
|
Audited Consolidated Statements of Cash Flows for the years ended December 31,
2015, 2014 and 2013
|
|
/s/ Ernst & Young LLP
|
|
London, United Kingdom
|
|
April 29, 2016
|
|
/s/ Ernst & Young LLP
|
|
London, United Kingdom
|
|
April 29, 2016
|
|
|
Notes
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Operating revenues
|
|
|
|
|
|
|
|
||||||
Time and voyage charter revenues
|
|
|
90,127
|
|
|
95,399
|
|
|
90,558
|
|
|||
Vessel and other management fees*
|
|
|
12,547
|
|
|
10,756
|
|
|
9,270
|
|
|||
Total operating revenues
|
|
|
102,674
|
|
|
106,155
|
|
|
99,828
|
|
|||
Operating expenses
|
|
|
|
|
|
|
|
|
|||||
Vessel operating expenses
|
|
|
56,347
|
|
|
49,570
|
|
|
43,750
|
|
|||
Voyage, charter-hire and commission expenses*
|
|
|
69,042
|
|
|
27,340
|
|
|
14,259
|
|
|||
Administrative expenses
|
|
|
33,526
|
|
|
19,267
|
|
|
22,952
|
|
|||
Depreciation and amortization
|
|
|
73,732
|
|
|
49,811
|
|
|
36,871
|
|
|||
Impairment of long-term assets
|
|
|
1,957
|
|
|
500
|
|
|
500
|
|
|||
Total operating expenses
|
|
|
234,604
|
|
|
146,488
|
|
|
118,332
|
|
|||
Gain on disposals to Golar Partners*
|
6
|
|
102,884
|
|
|
43,783
|
|
|
65,619
|
|
|||
Other operating loss
|
26
|
|
—
|
|
|
(6,387
|
)
|
|
—
|
|
|||
Impairment of vessel held-for-sale
|
19
|
|
(1,032
|
)
|
|
—
|
|
|
—
|
|
|||
Other operating gains - LNG trade
|
|
|
—
|
|
|
1,317
|
|
|
—
|
|
|||
Loss on disposal of vessel held-for-sale
|
19
|
|
(5,824
|
)
|
|
—
|
|
|
—
|
|
|||
Operating (loss) income
|
|
|
(35,902
|
)
|
|
(1,620
|
)
|
|
47,115
|
|
|||
Other non-operating income
|
|
|
|
|
|
|
|
||||||
Dividend income*
|
|
|
15,524
|
|
|
27,203
|
|
|
30,960
|
|
|||
Loss on sale of available-for-sale securities
|
|
|
(3,011
|
)
|
|
—
|
|
|
(754
|
)
|
|||
Other non-operating income (expense)
|
|
|
—
|
|
|
281
|
|
|
(2,601
|
)
|
|||
Total other non-operating income
|
|
|
12,513
|
|
|
27,484
|
|
|
27,605
|
|
|||
Financial income (expense)
|
|
|
|
|
|
|
|
|
|||||
Interest income*
|
|
|
6,896
|
|
|
716
|
|
|
3,549
|
|
|||
Interest expense*
|
|
|
(62,911
|
)
|
|
(14,474
|
)
|
|
—
|
|
|||
Other financial items, net
|
9
|
|
(118,604
|
)
|
|
(74,094
|
)
|
|
38,219
|
|
|||
Net financial (expense) income
|
|
|
(174,619
|
)
|
|
(87,852
|
)
|
|
41,768
|
|
|||
(Loss) income before equity in net earnings of affiliates, income taxes and non-controlling interests
|
|
|
(198,008
|
)
|
|
(61,988
|
)
|
|
116,488
|
|
|||
Income taxes
|
10
|
|
3,053
|
|
|
1,114
|
|
|
3,404
|
|
|||
Equity in net earnings of affiliates
|
13
|
|
16,454
|
|
|
19,408
|
|
|
15,821
|
|
|||
Net (loss) income
|
|
|
(178,501
|
)
|
|
(41,466
|
)
|
|
135,713
|
|
|||
Net income attributable to non-controlling interests
|
|
|
(19,158
|
)
|
|
(1,655
|
)
|
|
—
|
|
|||
Net (loss) income attributable to Golar LNG Ltd
|
|
(197,659
|
)
|
|
(43,121
|
)
|
|
135,713
|
|
||||
(Loss) earnings per share attributable to Golar LNG Ltd stockholders
Per common share amounts:
|
|
|
|
|
|
|
|
|
|||||
(Loss) earnings – Basic
|
11
|
|
$
|
(2.12
|
)
|
|
$
|
(0.50
|
)
|
|
$
|
1.69
|
|
(Loss) earnings – Diluted
|
11
|
|
$
|
(2.12
|
)
|
|
$
|
(0.50
|
)
|
|
$
|
1.59
|
|
Cash dividends declared and paid
|
|
$
|
1.35
|
|
|
$
|
1.80
|
|
|
$
|
1.35
|
|
|
Notes
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
COMPREHENSIVE INCOME
|
|
|
|
|
|
|
|
|||
Net (loss) income
|
|
|
(178,501
|
)
|
|
(41,466
|
)
|
|
135,713
|
|
Other comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
Gain (loss) associated with pensions, net of tax
|
29
|
|
2,851
|
|
|
(2,520
|
)
|
|
5,078
|
|
Net (loss) gain on qualifying cash flow hedging instruments
(1)
|
31
|
|
(493
|
)
|
|
6,493
|
|
|
5,010
|
|
Net (loss) gain on investments in available-for-sale securities
|
31
|
|
(44,359
|
)
|
|
7,955
|
|
|
1,885
|
|
Other comprehensive (loss) income
|
31
|
|
(42,001
|
)
|
|
11,928
|
|
|
11,973
|
|
Comprehensive (loss) income
|
|
|
(220,502
|
)
|
|
(29,538
|
)
|
|
147,686
|
|
Comprehensive (loss) income attributable to:
|
|
|
|
|
|
|
|
|||
Stockholders of Golar LNG Limited
|
|
|
(239,660
|
)
|
|
(31,193
|
)
|
|
147,686
|
|
Non-controlling interests
|
|
|
19,158
|
|
|
1,655
|
|
|
—
|
|
Comprehensive (loss) income
|
|
|
(220,502
|
)
|
|
(29,538
|
)
|
|
147,686
|
|
|
Notes
|
|
2015
|
|
|
2014
|
|
ASSETS
|
|
|
|
|
|
||
Current Assets
|
|
|
|
|
|
||
Cash and cash equivalents
|
|
|
105,235
|
|
|
191,410
|
|
Restricted cash and short-term receivables
|
21
|
|
228,202
|
|
|
74,162
|
|
Trade accounts receivable
|
14
|
|
4,474
|
|
|
4,419
|
|
Other receivables, prepaid expenses and accrued income
|
15
|
|
24,753
|
|
|
17,498
|
|
Amounts due from related parties
|
33
|
|
—
|
|
|
9,967
|
|
Short-term debt due from related party
|
33
|
|
—
|
|
|
20,000
|
|
Inventories
|
|
|
8,650
|
|
|
8,317
|
|
Vessel held-for-sale
|
19
|
|
—
|
|
|
132,110
|
|
Assets held-for-sale
|
19
|
|
269,459
|
|
|
284,955
|
|
Total current assets
|
|
|
640,773
|
|
|
742,838
|
|
Long-term assets
|
|
|
|
|
|
||
Restricted cash
|
21
|
|
180,361
|
|
|
425
|
|
Investment in available-for-sale securities
|
22
|
|
25,530
|
|
|
275,307
|
|
Investments in affiliates
|
13
|
|
313,021
|
|
|
335,372
|
|
Cost method investments
|
23
|
|
204,172
|
|
|
204,172
|
|
Newbuildings
|
16
|
|
13,561
|
|
|
344,543
|
|
Asset under development
|
17
|
|
501,022
|
|
|
345,205
|
|
Vessels and equipment, net
|
18
|
|
2,336,144
|
|
|
1,648,888
|
|
Deferred charges
|
20
|
|
42,154
|
|
|
26,801
|
|
Other non-current assets
|
24
|
|
50,850
|
|
|
68,442
|
|
Total assets
|
|
|
4,307,588
|
|
|
3,991,993
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
|
|
Current portion of long-term debt and short-term debt
|
27
|
|
501,618
|
|
|
116,431
|
|
Trade accounts payable
|
|
|
53,281
|
|
|
10,811
|
|
Accrued expenses
|
25
|
|
53,333
|
|
|
31,124
|
|
Amounts due to related parties
|
33
|
|
7,128
|
|
|
—
|
|
Other current liabilities
|
26
|
|
148,583
|
|
|
46,923
|
|
Liabilities held-for-sale
|
19
|
|
203,638
|
|
|
164,401
|
|
Total current liabilities
|
|
|
967,581
|
|
|
369,690
|
|
Long-term liabilities
|
|
|
|
|
|
||
Long-term debt
|
27
|
|
1,376,443
|
|
|
1,264,356
|
|
Other long-term liabilities
|
28
|
|
69,225
|
|
|
75,440
|
|
Total liabilities
|
|
|
2,413,249
|
|
|
1,709,486
|
|
Commitments and Contingencies (see notes 34 and 35)
EQUITY
|
|
|
|
|
|
|
|
Share capital 93,546,663 common shares
of $1.00 each issued and outstanding (2014: 93,414,672) |
30
|
|
93,547
|
|
|
93,415
|
|
Treasury shares
|
|
|
(12,269
|
)
|
|
—
|
|
Additional paid-in capital
|
|
|
1,317,806
|
|
|
1,307,087
|
|
Contributed surplus
|
|
|
200,000
|
|
|
200,000
|
|
Accumulated other comprehensive (loss) gain
|
|
|
(41,254
|
)
|
|
5,171
|
|
Retained earnings
|
|
|
315,696
|
|
|
675,179
|
|
Total stockholders' equity
|
|
|
1,873,526
|
|
|
2,280,852
|
|
Non-controlling interests
|
4
|
|
20,813
|
|
|
1,655
|
|
Total equity
|
|
|
1,894,339
|
|
|
2,282,507
|
|
Total liabilities and equity
|
|
|
4,307,588
|
|
|
3,991,993
|
|
|
Notes
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
Operating activities
|
|
|
|
|
|
|
|
|||
Net (loss) income
|
|
|
(178,501
|
)
|
|
(41,466
|
)
|
|
135,713
|
|
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:
|
|
|
|
|
|
|
|
|
||
Depreciation and amortization
|
|
|
73,732
|
|
|
49,811
|
|
|
36,871
|
|
Amortization of deferred charges and debt guarantee
|
|
|
(2,073
|
)
|
|
2,459
|
|
|
1,120
|
|
Equity in net earnings of affiliates
|
|
|
(16,454
|
)
|
|
(19,408
|
)
|
|
(15,821
|
)
|
Gain on disposals to Golar Partners
|
6
|
|
(102,884
|
)
|
|
(43,783
|
)
|
|
(65,619
|
)
|
Loss on sale of vessel
|
|
|
5,824
|
|
|
—
|
|
|
—
|
|
Impairment of vessel held-for-sale
|
|
|
1,032
|
|
|
—
|
|
|
—
|
|
Dividend income from available-for-sale and cost investments recognized in operating income
|
|
|
(15,524
|
)
|
|
(27,203
|
)
|
|
(30,960
|
)
|
Dividends received
|
|
|
52,800
|
|
|
61,967
|
|
|
64,198
|
|
Loss on disposal of available-for-sale securities
|
|
|
3,011
|
|
|
—
|
|
|
754
|
|
Gain on disposal of high yield bond in Golar Partners
|
|
|
—
|
|
|
—
|
|
|
(841
|
)
|
Compensation cost related to stock options
|
|
|
4,125
|
|
|
1,619
|
|
|
500
|
|
Net foreign exchange losses (gain)
|
|
|
2,404
|
|
|
1,314
|
|
|
(277
|
)
|
Amortization of deferred tax benefits on intra-group transfers
|
|
|
(3,488
|
)
|
|
(3,488
|
)
|
|
(3,487
|
)
|
Impairment of long-term assets
|
8
|
|
1,957
|
|
|
500
|
|
|
500
|
|
Impairment of loan receivable
|
9
|
|
15,010
|
|
|
—
|
|
|
—
|
|
Drydocking expenditure
|
|
|
(10,405
|
)
|
|
(8,947
|
)
|
|
(4,248
|
)
|
Change in assets and liabilities, net of effects from the sale of
Golar Eskimo
,
Golar Igloo
and
Golar Maria
:
|
|
|
|
|
|
|
|
|||
Restricted cash
|
21
|
|
(280,000
|
)
|
|
—
|
|
|
—
|
|
Trade accounts receivable
|
|
|
911
|
|
|
(10,533
|
)
|
|
304
|
|
Inventories
|
|
|
(2,252
|
)
|
|
(809
|
)
|
|
(10,137
|
)
|
Prepaid expenses, accrued income and other assets
|
|
|
(6,361
|
)
|
|
27,612
|
|
|
(50,877
|
)
|
Amounts due from/to related companies
|
|
|
15,259
|
|
|
(6,003
|
)
|
|
3,497
|
|
Trade accounts payable
|
|
|
8,944
|
|
|
(1,746
|
)
|
|
2,525
|
|
Accrued expenses
|
|
|
21,479
|
|
|
13,802
|
|
|
3,349
|
|
Other current liabilities
(1)
|
|
|
66,805
|
|
|
29,175
|
|
|
658
|
|
Net cash (used in) provided by operating activities
|
|
|
(344,649
|
)
|
|
24,873
|
|
|
67,722
|
|
Investing activities
|
|
|
|
|
|
|
|
|||
Additions to vessels and equipment
|
|
|
(26,110
|
)
|
|
(2,359
|
)
|
|
(802
|
)
|
Additions to newbuildings
|
|
|
(559,667
|
)
|
|
(1,150,669
|
)
|
|
(733,353
|
)
|
Additions to asset under development
|
|
|
(111,572
|
)
|
|
(313,645
|
)
|
|
—
|
|
Investment in subsidiary, net of cash acquired
|
|
|
(16
|
)
|
|
—
|
|
|
—
|
|
Proceeds from disposal of investments in available-for-sale securities
|
|
|
207,428
|
|
|
—
|
|
|
99,210
|
|
Additions to available-for-sale-securities
|
|
|
(5,023
|
)
|
|
—
|
|
|
(12,400
|
)
|
Additions to investments
|
|
|
—
|
|
|
—
|
|
|
(5,649
|
)
|
Short-term loan granted to third party
|
|
|
(2,000
|
)
|
|
—
|
|
|
(11,960
|
)
|
Repayment of short-term loan granted to third party
|
|
|
400
|
|
|
—
|
|
|
2,469
|
|
|
|
|
|
|
|
|
|
|||
|
Notes
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
Investing activities (continued)
|
|
|
|
|
|
|
|
|
|
|
Proceeds from disposals to Golar Partners, net of cash disposed
|
|
|
226,872
|
|
|
155,319
|
|
|
119,927
|
|
Proceeds from disposal of high yield bond in Golar Partners
|
|
|
—
|
|
|
—
|
|
|
34,483
|
|
Short-term loan granted to Golar Partners
|
|
|
—
|
|
|
(20,000
|
)
|
|
(20,000
|
)
|
Additions to other long-term assets
|
|
|
—
|
|
|
(49,873
|
)
|
|
—
|
|
Repayment of short-term loan granted to Golar Partners
|
|
|
20,000
|
|
|
—
|
|
|
20,000
|
|
Proceeds from disposal of fixed assets
|
|
|
18,987
|
|
|
—
|
|
|
—
|
|
Restricted cash and short-term receivables
|
|
|
(25,255
|
)
|
|
(48,043
|
)
|
|
(24,992
|
)
|
Net cash used in investing activities
|
|
|
(255,956
|
)
|
|
(1,429,270
|
)
|
|
(533,067
|
)
|
Financing activities
|
|
|
|
|
|
|
|
|||
Proceeds from short-term and long-term debt (including related parties)
|
27
|
|
918,801
|
|
|
1,222,746
|
|
|
306,358
|
|
Repayments of short-term and long-term debt (including related parties)
|
27
|
|
(215,363
|
)
|
|
(239,903
|
)
|
|
(9,400
|
)
|
Financing costs paid
|
|
|
(23,266
|
)
|
|
(18,672
|
)
|
|
(22,612
|
)
|
Cash dividends paid
|
26
|
|
(121,358
|
)
|
|
(155,996
|
)
|
|
(108,976
|
)
|
Proceeds from exercise of share options
|
|
|
225
|
|
|
1,338
|
|
|
608
|
|
Purchase of treasury shares
|
|
|
(12,269
|
)
|
|
—
|
|
|
—
|
|
Proceeds from issuance of equity
|
30
|
|
—
|
|
|
660,947
|
|
|
—
|
|
Restricted cash and short-term receivables
|
|
|
(32,340
|
)
|
|
—
|
|
|
—
|
|
Net cash provided by financing activities
|
|
|
514,430
|
|
|
1,470,460
|
|
|
165,978
|
|
Net (decrease) increase in cash and cash equivalents
|
|
|
(86,175
|
)
|
|
66,063
|
|
|
(299,367
|
)
|
Cash and cash equivalents at beginning of period
|
|
|
191,410
|
|
|
125,347
|
|
|
424,714
|
|
Cash and cash equivalents at end of period
|
|
|
105,235
|
|
|
191,410
|
|
|
125,347
|
|
|
|
|
|
|
|
|
|
|||
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
|
|
|
|
|
Cash paid during the year for:
|
|
|
|
|
|
|
|
|
|
|
Interest paid, net of capitalized interest
|
|
|
37,964
|
|
|
11,372
|
|
|
—
|
|
Income taxes paid
|
|
|
1,278
|
|
|
1,372
|
|
|
1,322
|
|
|
Notes
|
|
Share Capital
|
|
Treasury Shares
|
|
Additional Paid-in Capital
|
|
Contributed Surplus
|
|
Accumulated Other Compre- hensive Loss
|
|
Accumulated Earnings
|
|
Non-controlling Interest
|
|
Total
Equity
|
||||||||||||
Balance at December 31, 2012
|
|
|
80,504
|
|
|
—
|
|
|
654,042
|
|
|
200,000
|
|
|
(18,730
|
)
|
|
848,503
|
|
|
—
|
|
|
1,764,319
|
|
||||
Net income
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
135,713
|
|
|
—
|
|
|
135,713
|
|
||||
Dividends
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(108,976
|
)
|
|
—
|
|
|
(108,976
|
)
|
||||
Exercise of share options
|
|
|
76
|
|
|
—
|
|
|
1,476
|
|
|
—
|
|
|
—
|
|
|
(944
|
)
|
|
—
|
|
|
608
|
|
||||
Grant of share options
|
|
|
—
|
|
|
—
|
|
|
500
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
500
|
|
||||
Other comprehensive income
|
31
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,973
|
|
|
—
|
|
|
—
|
|
|
11,973
|
|
||||
Balance at December 31, 2013
|
|
|
80,580
|
|
|
—
|
|
|
656,018
|
|
|
200,000
|
|
|
(6,757
|
)
|
|
874,296
|
|
|
—
|
|
|
1,804,137
|
|
||||
Net (loss) income
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(43,121
|
)
|
|
1,655
|
|
|
(41,466
|
)
|
||||
Dividends
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(155,996
|
)
|
|
—
|
|
|
(155,996
|
)
|
||||
Exercise of share options
|
|
|
185
|
|
|
—
|
|
|
1,153
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,338
|
|
||||
Grant of share options
|
|
|
—
|
|
|
—
|
|
|
1,619
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,619
|
|
||||
Net proceeds from issuance of shares
|
30
|
|
12,650
|
|
|
—
|
|
|
648,297
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
660,947
|
|
||||
Other comprehensive income
|
31
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,928
|
|
|
—
|
|
|
—
|
|
|
11,928
|
|
||||
Balance at December 31, 2014
|
|
|
93,415
|
|
|
—
|
|
|
1,307,087
|
|
|
|
200,000
|
|
|
|
5,171
|
|
|
|
675,179
|
|
|
|
1,655
|
|
|
2,282,507
|
|
Net loss
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(197,659
|
)
|
|
19,158
|
|
|
(178,501
|
)
|
||||
Dividends
|
26
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(161,824
|
)
|
|
—
|
|
|
(161,824
|
)
|
||||
Exercise of share options
|
|
|
132
|
|
|
—
|
|
|
93
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
225
|
|
||||
Grant of share options
|
|
|
—
|
|
|
—
|
|
|
6,358
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,358
|
|
||||
Forfeiture of share options
|
|
|
—
|
|
|
—
|
|
|
(2,521
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,521
|
)
|
||||
Cancellation of share options
|
|
|
—
|
|
|
—
|
|
|
786
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
786
|
|
||||
Transfer of additional paid-in capital
|
2
|
|
—
|
|
|
—
|
|
|
6,003
|
|
|
—
|
|
|
(4,424
|
)
|
|
—
|
|
|
—
|
|
|
1,579
|
|
||||
Other comprehensive loss
|
31
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(42,001
|
)
|
|
—
|
|
|
—
|
|
|
(42,001
|
)
|
||||
Treasury shares
|
|
|
—
|
|
|
(12,269
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(12,269
|
)
|
||||
Balance at December 31, 2015
|
|
|
93,547
|
|
|
(12,269
|
)
|
|
1,317,806
|
|
—
|
|
200,000
|
|
—
|
|
(41,254
|
)
|
—
|
|
315,696
|
|
—
|
|
20,813
|
|
|
1,894,339
|
|
1.
|
GENERAL
|
2.
|
ACCOUNTING POLICIES
|
Vessels
|
40 to 50 years
|
Deferred drydocking expenditure
|
two to five years
|
Office equipment and fittings
|
three to six years
|
•
|
Management, having the authority to approve the action, commits to a plan to sell the vessel;
|
•
|
The non-current asset or subsidiaries are available for immediate sale in its present condition subject only to terms that are usual and customary for such sales;
|
•
|
An active program to locate a buyer and other actions required to complete the plan to sell have been initiated;
|
•
|
The sale is highly probable; and
|
•
|
The transfer is expected to qualify for recognition as a completed sale, within one year.
|
3.
|
SUBSIDIARIES
|
Name
|
Jurisdiction of Incorporation
|
Purpose
|
Golar LNG 2216 Corporation
|
Marshall Islands
|
Owns
Golar Arctic
|
Golar Management Limited
|
United Kingdom
|
Management company
|
Golar GP LLC – Limited Liability Company
|
Marshall Islands
|
Holding company
|
Golar LNG Energy Limited
|
Bermuda
|
Holding company
|
Golar Gimi Corporation
|
Marshall Islands
|
Owns
Gimi
|
Golar Hilli Corporation (89%)*
|
Marshall Islands
|
Owns
Hilli
|
Golar Gandria N.V.
|
Netherlands
|
Owns and operates
Gandria
|
Golar Hull M2021 Corporation
|
Marshall Islands
|
Owns and operates
Golar Seal
|
Golar Hull M2022 Corporation
|
Marshall Islands
|
Owns and operates
Golar Crystal
|
Golar Hull M2023 Corporation
|
Marshall Islands
|
Owns and operates
Golar Penguin
|
LNG Power Limited
|
United Kingdom
|
Holding company
|
Golar Hull M2026 Corporation
|
Marshall Islands
|
Owns and operates
Golar Celsius
|
Golar Hull M2027 Corporation
|
Marshall Islands
|
Owns and operates G
olar Bear
|
Golar Hull M2047 Corporation
|
Marshall Islands
|
Leases and operates
Golar Snow***
|
Golar Hull M2048 Corporation
|
Marshall Islands
|
Leases and operates
Golar Ice***
|
Golar LNG NB10 Corporation
|
Marshall Islands
|
Leases and operates
Golar Glacier***
|
Golar LNG NB11 Corporation
|
Marshall Islands
|
Leases and operates
Golar Kelvin***
|
Golar LNG NB12 Corporation
|
Marshall Islands
|
Owns and operates
Golar Frost
|
Golar LNG NB13 Corporation
|
Marshall Islands
|
Leases and operates
Golar Tundra***
|
GVS Corporation
|
Marshall Islands
|
Owns and operates
Golar Viking
|
Golar Management Norway AS**
|
Norway
|
Management company
|
Golar Commodities Limited
|
Bermuda
|
Trading company
|
4.
|
VARIABLE INTEREST ENTITIES ("VIE")
|
Vessel
|
Effective from
|
Sales value (in $ millions)
|
First repurchase option (in $ millions)
|
Date of first repurchase option
|
Repurchase obligation at end of lease term
(in $ millions)
|
End of lease term
|
Golar Glacier
|
October 2014
|
204.0
|
173.8
|
October 2019
|
142.7
|
October 2024
|
Golar Kelvin
|
January 2015
|
204.0
|
173.8
|
January 2020
|
142.7
|
January 2025
|
Golar Snow
|
January 2015
|
204.0
|
173.8
|
January 2020
|
142.7
|
January 2025
|
Golar Ice
|
February 2015
|
204.0
|
173.8
|
February 2020
|
142.7
|
February 2025
|
Golar Tundra
|
November 2015
|
254.6
|
194.1
|
November 2018
|
101.8
|
November 2025
|
(in $ thousands)
|
2016
|
2017
|
2018
|
2019
|
2020
|
2021+
|
Golar Glacier
|
17,147
|
17,100
|
17,100
|
17,100
|
17,147
|
64,137
|
Golar Kelvin
|
17,147
|
17,100
|
17,100
|
17,100
|
17,147
|
66,995
|
Golar Snow
|
17,147
|
17,100
|
17,100
|
17,100
|
17,147
|
66,995
|
Golar Ice
|
17,147
|
17,100
|
17,100
|
17,100
|
17,147
|
69,899
|
Golar Tundra
|
12,729
|
12,729
|
12,729
|
12,729
|
12,729
|
61,522
|
(in $ thousands)
|
Golar Glacier
|
Golar Kelvin
|
Golar Snow
|
Golar Ice
|
Golar Tundra
|
2015
|
|
2014
|
|||||||
Assets
|
|
|
|
|
|
Total
|
|
Total
|
|||||||
Restricted cash and short term receivables (see note 21)
|
7,132
|
|
16,942
|
|
8,648
|
|
2,728
|
|
—
|
|
35,450
|
|
|
—
|
|
Restricted cash - held-for-sale current assets
(1)
(see note 19)
|
—
|
|
—
|
|
—
|
|
—
|
|
3,618
|
|
3,618
|
|
|
—
|
|
|
7,132
|
|
16,942
|
|
8,648
|
|
2,728
|
|
3,618
|
|
39,068
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|||||||
Liabilities
|
|
|
|
|
|
|
|
|
|||||||
Debt:
|
|
|
|
|
|
|
|
|
|||||||
Short-term interest bearing debt (see note 27)
|
31,826
|
|
182,540
|
|
22,566
|
|
172,046
|
|
—
|
|
408,978
|
|
|
31,826
|
|
Long-term interest bearing debt - current portion (see note 27)
|
7,650
|
|
—
|
|
8,000
|
|
—
|
|
—
|
|
15,650
|
|
|
7,650
|
|
Long-term interest bearing debt - non-current portion (see note 27)
|
137,700
|
|
—
|
|
148,000
|
|
—
|
|
—
|
|
285,700
|
|
|
145,350
|
|
Short-term interest bearing debt - held-for-sale
(1)
(see note 19)
|
—
|
|
—
|
|
—
|
|
—
|
|
201,725
|
|
201,725
|
|
|
—
|
|
|
177,176
|
|
182,540
|
|
178,566
|
|
172,046
|
|
201,725
|
|
912,053
|
|
|
184,826
|
|
(1)
|
The assets and liabilities relating to the
Golar Tundra
lessor VIE have been reclassified as “held-for-sale” in connection with the sale of our interests in the companies that own and operate the vessel to Golar Partners (see note 19).
|
5.
|
RECENTLY ISSUED ACCOUNTING STANDARDS
|
•
|
modify the evaluation of whether limited partnerships and similar legal entities are variable interest entities (VIEs) or voting interest entities;
|
•
|
eliminate the presumption that a general partner should consolidate a limited partnership;
|
•
|
affect the consolidation analysis of reporting entities that are involved with VIEs, particularly those that have fee arrangements and related party relationships; and
|
•
|
provide a scope exception from consolidation guidance for reporting entities with interest in legal entities that are required to comply with or operate in accordance with requirements that are similar to those in Rule 2a-7 of the Investment Company Act of 1940 for registered money market funds.
|
6.
|
DISPOSALS TO GOLAR PARTNERS
|
(in thousands of $)
|
Golar Eskimo
|
|
Cash consideration received
(1)
|
226,010
|
|
Carrying value of the net assets sold to Golar Partners
|
(123,604
|
)
|
Gain on disposal
|
102,406
|
|
(in thousands of $)
|
Golar Igloo
|
|
Cash consideration received
(2)
|
156,001
|
|
Carrying value of the net assets sold to Golar Partners
|
(112,714
|
)
|
Gain on disposal
|
43,287
|
|
(in thousands of $)
|
Golar Maria
|
|
Cash consideration received
(3)
|
127,900
|
|
Carrying value of the net assets sold to Golar Partners
|
(45,630
|
)
|
Gain on disposal
|
82,270
|
|
Deferred gain on sale (note 28)
|
(17,114
|
)
|
Gain recognized on sale
|
65,156
|
|
7.
|
SEGMENTAL INFORMATION
|
•
|
Vessel operations – We operate and subsequently charter out LNG carriers and FSRUs on fixed terms to customers.
|
•
|
LNG trading – We provide physical and financial risk management in LNG and gas markets for customers around the world. Activities include structured services to outside customers, arbitrage service as well as proprietary trading.
|
•
|
FLNG – In 2014, we ordered our first FLNG based on the conversion of our existing LNG carrier, the
Hilli.
The
Hilli
FLNG conversion is expected to be completed and delivered in 2017. The costs associated with the conversion to a FLNG has been considered as a separate segment.
|
(in thousands of $)
|
2015
|
|
2014
|
|
2013
|
|||||||||||||||||||
|
Vessel operations
|
|
LNG
trading
|
|
FLNG*
|
|
Total
|
|
|
Vessel
operations |
|
LNG
trading |
|
FLNG*
|
|
Total
|
|
|
Vessel
operations
|
|
LNG
trading
|
|
Total
|
|
Time and voyage charter revenues
|
90,127
|
|
—
|
|
—
|
|
90,127
|
|
|
95,399
|
|
—
|
|
—
|
|
95,399
|
|
|
90,558
|
|
—
|
|
90,558
|
|
Vessel and other management fees
|
12,547
|
|
—
|
|
—
|
|
12,547
|
|
|
10,756
|
|
—
|
|
—
|
|
10,756
|
|
|
9,270
|
|
—
|
|
9,270
|
|
Vessel and voyage operating expenses
|
(125,389
|
)
|
—
|
|
—
|
|
(125,389
|
)
|
|
(76,910
|
)
|
—
|
|
—
|
|
(76,910
|
)
|
|
(58,009
|
)
|
—
|
|
(58,009
|
)
|
Administrative expenses
|
(28,657
|
)
|
—
|
|
(4,869
|
)
|
(33,526
|
)
|
|
(17,468
|
)
|
(64
|
)
|
(1,735
|
)
|
(19,267
|
)
|
|
(22,816
|
)
|
(136
|
)
|
(22,952
|
)
|
Impairment of long-term assets
|
(1,957
|
)
|
—
|
|
—
|
|
(1,957
|
)
|
|
(500
|
)
|
—
|
|
—
|
|
(500
|
)
|
|
(500
|
)
|
—
|
|
(500
|
)
|
Depreciation and amortization
|
(73,732
|
)
|
—
|
|
—
|
|
(73,732
|
)
|
|
(49,561
|
)
|
(250
|
)
|
—
|
|
(49,811
|
)
|
|
(36,562
|
)
|
(309
|
)
|
(36,871
|
)
|
Other operating loss
|
—
|
|
—
|
|
—
|
|
—
|
|
|
(6,387
|
)
|
—
|
|
—
|
|
(6,387
|
)
|
|
—
|
|
—
|
|
—
|
|
Other operating gains (losses) - LNG trade
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
1,317
|
|
—
|
|
1,317
|
|
|
—
|
|
—
|
|
—
|
|
Gain on disposals to Golar Partners (including amortization of deferred gain)
|
102,884
|
|
—
|
|
—
|
|
102,884
|
|
|
43,783
|
|
—
|
|
—
|
|
43,783
|
|
|
65,619
|
|
—
|
|
65,619
|
|
Impairment of vessel held-for-sale
|
(1,032
|
)
|
—
|
|
—
|
|
(1,032
|
)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
Loss on disposal of vessel
|
(5,824
|
)
|
—
|
|
—
|
|
(5,824
|
)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
Operating (loss) income
|
(31,033
|
)
|
—
|
|
(4,869
|
)
|
(35,902
|
)
|
|
(888
|
)
|
1,003
|
|
(1,735
|
)
|
(1,620
|
)
|
|
47,560
|
|
(445
|
)
|
47,115
|
|
Other non-operating income (loss)
|
12,513
|
|
|
|
—
|
|
12,513
|
|
|
26,766
|
|
718
|
|
—
|
|
27,484
|
|
|
27,605
|
|
—
|
|
27,605
|
|
Net financial (expenses) income
|
(174,619
|
)
|
—
|
|
—
|
|
(174,619
|
)
|
|
(87,600
|
)
|
(252
|
)
|
—
|
|
(87,852
|
)
|
|
41,768
|
|
—
|
|
41,768
|
|
Income taxes
|
3,053
|
|
—
|
|
—
|
|
3,053
|
|
|
1,114
|
|
—
|
|
—
|
|
1,114
|
|
|
3,404
|
|
—
|
|
3,404
|
|
Equity in net earnings (losses) of affiliates
|
16,454
|
|
—
|
|
—
|
|
16,454
|
|
|
19,408
|
|
—
|
|
—
|
|
19,408
|
|
|
15,821
|
|
—
|
|
15,821
|
|
Net (loss) income
|
(173,632
|
)
|
—
|
|
(4,869
|
)
|
(178,501
|
)
|
|
(41,200
|
)
|
1,469
|
|
(1,735
|
)
|
(41,466
|
)
|
|
136,158
|
|
(445
|
)
|
135,713
|
|
Non-controlling interests
|
(19,158
|
)
|
—
|
|
—
|
|
(19,158
|
)
|
|
(1,655
|
)
|
—
|
|
—
|
|
(1,655
|
)
|
|
—
|
|
—
|
|
—
|
|
Net (loss) income attributable to Golar LNG Ltd
|
(192,790
|
)
|
—
|
|
(4,869
|
)
|
(197,659
|
)
|
|
(42,855
|
)
|
1,469
|
|
(1,735
|
)
|
(43,121
|
)
|
|
136,158
|
|
(445
|
)
|
135,713
|
|
Total assets
|
3,436,784
|
|
—
|
|
870,804
|
|
4,307,588
|
|
|
3,630,538
|
|
1,335
|
|
360,120
|
|
3,991,993
|
|
|
2,664,953
|
|
268
|
|
2,665,221
|
|
Investment in affiliates
|
313,021
|
|
—
|
|
—
|
|
313,021
|
|
|
335,372
|
|
—
|
|
—
|
|
335,372
|
|
|
350,918
|
|
—
|
|
350,918
|
|
Capital expenditures
|
565,777
|
|
—
|
|
111,572
|
|
677,349
|
|
|
1,202,901
|
|
—
|
|
313,645
|
|
1,516,546
|
|
|
734,155
|
|
—
|
|
734,155
|
|
(in thousands of $)
|
2015
|
|
2014
|
|
2013
|
||||||||||||
Nigeria LNG Ltd
|
37,994
|
|
|
42
|
%
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
Major commodity trading company
|
16,167
|
|
|
18
|
%
|
|
15,761
|
|
|
17
|
%
|
|
—
|
|
|
—
|
%
|
Major Japanese trading company
|
—
|
|
|
—
|
%
|
|
55,975
|
|
|
59
|
%
|
|
47,744
|
|
|
53
|
%
|
Gdf Suez Gas
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
10,015
|
|
|
11
|
%
|
Eni Spa
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
8,912
|
|
|
10
|
%
|
BG Group plc
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
13,114
|
|
|
14
|
%
|
Revenues (in thousands of $)
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
Kuwait*
|
|
—
|
|
|
4,182
|
|
|
—
|
|
8.
|
IMPAIRMENT OF LONG-TERM ASSETS
|
Vessel
|
2015 Market value
(1)
|
2015 Carrying value
|
Deficit
|
Golar Arctic
|
115,000
|
149,600
|
34,600
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
|
2013
|
|
Impairment charge
|
1,957
|
|
|
500
|
|
|
500
|
|
9.
|
OTHER FINANCIAL ITEMS, NET
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
|
2013
|
|
Mark-to-market adjustment for interest rate swap derivatives (see note 32)
|
(12,798
|
)
|
|
(28,996
|
)
|
|
56,461
|
|
Interest rate swap cash settlements (see note 32)
|
(15,797
|
)
|
|
(20,424
|
)
|
|
(10,626
|
)
|
Mark-to-market adjustment for equity derivatives (see note 32)
|
(67,925
|
)
|
|
(13,657
|
)
|
|
—
|
|
Mark-to-market adjustment for foreign currency derivatives (see note 32)
|
—
|
|
|
94
|
|
|
719
|
|
Impairment of loan
|
(15,010
|
)
|
|
—
|
|
|
—
|
|
Financing arrangement fees and other costs
|
(1,841
|
)
|
|
(7,157
|
)
|
|
(5,632
|
)
|
Amortization of deferred financing costs and debt guarantee
|
(3,082
|
)
|
|
(2,459
|
)
|
|
(1,120
|
)
|
Foreign exchange loss on operations
|
(2,126
|
)
|
|
(1,200
|
)
|
|
(1,583
|
)
|
Other
|
(25
|
)
|
|
(295
|
)
|
|
—
|
|
|
(118,604
|
)
|
|
(74,094
|
)
|
|
38,219
|
|
10.
|
TAXATION
|
(in thousands of $)
|
2015
|
|
2014
|
|
2013
|
|||
Current tax expense/(credit):
|
|
|
|
|
|
|||
U.K.
|
435
|
|
|
2,212
|
|
|
(27
|
)
|
Total current tax expense/(credit)
|
435
|
|
|
2,212
|
|
|
(27
|
)
|
Deferred tax expense:
|
|
|
|
|
|
|
||
U.K.
|
—
|
|
|
161
|
|
|
110
|
|
Amortization of tax benefit arising on intra-group transfers of long-term assets
|
(3,488
|
)
|
|
(3,487
|
)
|
|
(3,487
|
)
|
Total income tax credit
|
(3,053
|
)
|
|
(1,114
|
)
|
|
(3,404
|
)
|
|
|
Year ended December 31
|
|||||||
(in thousands of $)
|
|
2015
|
|
2014
|
|
2013
|
|||
Income taxes at statutory rate
|
|
—
|
|
|
—
|
|
|
—
|
|
Effect of deferred tax benefit on intra-group transfers of long-term assets
|
|
(3,488
|
)
|
|
(3,487
|
)
|
|
(3,487
|
)
|
Effect of adjustments in respect of current tax in prior periods
|
|
(330
|
)
|
|
1,411
|
|
|
(188
|
)
|
Effect of taxable income in various countries
|
|
765
|
|
|
962
|
|
|
271
|
|
Total tax credit
|
|
(3,053
|
)
|
|
(1,114
|
)
|
|
(3,404
|
)
|
(in thousands of $)
|
2015
|
|
2014
|
||
Deferred tax assets, gross and net
|
260
|
|
|
260
|
|
11.
|
EARNINGS PER SHARE
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
|
2013
|
|
Net (loss) income attributable to Golar LNG Ltd stockholders - basic and diluted
|
(197,659
|
)
|
|
(43,121
|
)
|
|
135,713
|
|
(in thousands)
|
2015
|
|
|
2014
|
|
|
2013
|
|
Basic earnings per share:
|
|
|
|
|
|
|||
Weighted average number of common shares outstanding
|
93,357
|
|
|
87,013
|
|
|
80,530
|
|
|
|
|
|
|
|
|||
Diluted earnings per share:
|
|
|
|
|
|
|
|
|
Weighted average number of common shares outstanding
|
93,357
|
|
|
87,013
|
|
|
80,530
|
|
Effect of dilutive share options
|
—
|
|
|
—
|
|
|
381
|
|
Effect of dilutive convertible bonds
|
—
|
|
|
—
|
|
|
4,545
|
|
Common stock and common stock equivalents
|
93,357
|
|
|
87,013
|
|
|
85,456
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|||
Basic
|
$
|
(2.12
|
)
|
|
$
|
(0.50
|
)
|
|
$
|
1.69
|
|
Diluted
|
$
|
(2.12
|
)
|
|
$
|
(0.50
|
)
|
|
$
|
1.59
|
|
12.
|
OPERATING LEASES
|
Year ending December 31
|
Total
|
|
(in thousands of $)
|
|
|
2016
|
12,260
|
|
2017 and thereafter
|
12,852
|
|
Total
|
25,112
|
|
13.
|
INVESTMENTS IN AFFILIATES
|
|
2015
|
|
|
2014
|
|
Golar Partners
(1)
|
25.4
|
%
|
|
25.4
|
%
|
The Cool Pool Limited ("Pool Manager")
|
33
|
%
|
|
—
|
%
|
Egyptian Company for Gas Services S.A.E ("ECGS")
|
50
|
%
|
|
50
|
%
|
Golar Wilhelmsen Management AS ("Golar Wilhelmsen")
|
100
|
%
|
|
60
|
%
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
Cost
|
374,675
|
|
|
374,729
|
|
Dividend
|
(105,401
|
)
|
|
(68,127
|
)
|
Equity in net earnings of other affiliates
|
43,992
|
|
|
28,141
|
|
Share of other comprehensive (loss) income in affiliate
|
(245
|
)
|
|
629
|
|
Equity in net assets of affiliates
|
313,021
|
|
|
335,372
|
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
Subordinated units - accounted for under the equity method (i)
|
307,546
|
|
|
328,853
|
|
Common units (ii)
|
25,530
|
|
|
275,307
|
|
General Partner Units and IDRs (iii)
|
196,825
|
|
|
196,825
|
|
Total investments in Golar Partners
|
529,901
|
|
|
800,985
|
|
(i)
|
Subordinated units (Equity method)
|
(ii)
|
Common units (Available-for-sale securities)
|
(iii)
|
General Partner units and IDRs (Cost method)
|
(in thousands of $)
|
December 31, 2015
|
|
December 31, 2014
|
||||||||||
|
ECGS
|
|
Golar Partners
|
|
Pool Manager
|
|
|
Golar Wilhelmsen
|
|
ECGS
|
|
Golar Partners
|
|
Balance Sheet
|
|
|
|
|
|
|
|
||||||
Current assets
|
35,042
|
|
131,851
|
|
4,901
|
|
|
2,096
|
|
37,159
|
|
141,556
|
|
Non-current assets
|
3,200
|
|
2,113,487
|
|
—
|
|
|
5
|
|
3,224
|
|
1,814,646
|
|
Current liabilities
|
27,272
|
|
266,012
|
|
216
|
|
|
1,044
|
|
28,711
|
|
277,874
|
|
Non-current liabilities
|
20
|
|
1,382,811
|
|
—
|
|
|
—
|
|
20
|
|
1,076,589
|
|
Non-controlling interest
|
—
|
|
66,765
|
|
—
|
|
|
—
|
|
—
|
|
67,618
|
|
|
|
|
|
|
|
|
|
||||||
Statement of Operations
|
|
|
|
|
|
|
|
||||||
Revenue
|
72,294
|
|
434,687
|
|
8,356
|
|
|
6,732
|
|
78,946
|
|
396,026
|
|
Net income
|
730
|
|
172,683
|
|
—
|
|
|
479
|
|
1,508
|
|
184,735
|
|
|
|
|
|
|
|
|
|
14.
|
TRADE ACCOUNTS RECEIVABLE
|
15.
|
OTHER RECEIVABLES, PREPAID EXPENSES AND ACCRUED INCOME
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
Prepaid expenses
|
3,580
|
|
|
3,119
|
|
Other receivables
|
17,697
|
|
|
12,102
|
|
Corporation tax receivable
|
3,476
|
|
|
2,277
|
|
|
24,753
|
|
|
17,498
|
|
16.
|
NEWBUILDINGS
|
(in thousands of $)
|
|
|
2015
|
|
2014
|
|
Purchase price installments
|
|
|
12,375
|
|
312,160
|
|
Interest costs capitalized
|
|
|
1,139
|
|
17,806
|
|
Other costs capitalized
|
|
|
47
|
|
14,577
|
|
|
|
|
13,561
|
|
344,543
|
|
17.
|
ASSET UNDER DEVELOPMENT
|
(in thousands of $)
|
2015
|
|
2014
|
|
Purchase price installments
|
495,518
|
|
344,386
|
|
Interest costs capitalized
|
4,187
|
|
443
|
|
Other costs capitalized
|
1,317
|
|
376
|
|
|
501,022
|
|
345,205
|
|
18.
|
VESSELS AND EQUIPMENT, NET
|
(in thousands of $)
|
2015
|
|
2014
|
|
Cost
|
2,572,740
|
|
1,813,170
|
|
Accumulated depreciation
|
(236,596
|
)
|
(164,282
|
)
|
Net book value
|
2,336,144
|
|
1,648,888
|
|
19.
|
HELD-FOR-SALE
|
(in thousands of $)
|
As of December 31, 2015
|
As of December 31, 2014
|
||
ASSETS
|
|
|
||
Current assets
|
|
|
||
Restricted cash
|
3,618
|
|
—
|
|
Other receivables, prepaid expenses and accrued income
|
217
|
|
196
|
|
Inventories
|
572
|
|
266
|
|
Total current assets
|
4,407
|
|
462
|
|
|
|
|
||
Non-current assets
|
|
|
||
Vessels and equipment, net
|
262,627
|
|
280,284
|
|
Deferred charges
|
2,425
|
|
4,209
|
|
Total non-current assets
|
265,052
|
|
284,493
|
|
Total assets
(2)
|
269,459
|
|
284,955
|
|
|
|
|
||
LIABILITIES
|
|
|
||
Current liabilities
|
|
|
||
Current portion of long-term debt
|
—
|
|
(13,569
|
)
|
Short-term debt
(1)
|
(201,725
|
)
|
—
|
|
Trade accounts payable
|
(844
|
)
|
(419
|
)
|
Accrued expenses
|
(1,019
|
)
|
(786
|
)
|
Amounts due to related parties
|
(50
|
)
|
(366
|
)
|
Total current liabilities
|
(203,638
|
)
|
(15,140
|
)
|
|
|
|
||
Non-current liabilities
|
|
|
||
Long-term debt
|
—
|
|
(149,261
|
)
|
Total non-current liabilities
|
—
|
|
(149,261
|
)
|
Total liabilities
(2)
|
(203,638
|
)
|
(164,401
|
)
|
20.
|
DEFERRED CHARGES
|
(in thousands of $)
|
|
2015
|
|
2014
|
|
Debt arrangement fees and other deferred financing charges
|
|
52,150
|
|
32,903
|
|
Accumulated amortization
|
|
(9,996
|
)
|
(6,102
|
)
|
|
|
42,154
|
|
26,801
|
|
21.
|
RESTRICTED CASH AND SHORT-TERM RECEIVABLES
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
Restricted cash relating to the total return equity swap (see note 32)
|
92,752
|
|
|
46,051
|
|
Restricted cash in relation to the
Golar Viking
|
—
|
|
|
25,000
|
|
Restricted cash in relation to the
Hilli
|
280,000
|
|
|
—
|
|
Restricted cash and short-term receivables held by ICBC lessor VIEs (see note 4)
|
35,450
|
|
|
—
|
|
Restricted cash relating to projects
|
—
|
|
|
3,111
|
|
Restricted cash relating to office lease
|
361
|
|
|
425
|
|
Total restricted cash
|
408,563
|
|
|
74,587
|
|
Less: Amounts included in short-term restricted cash and short-term receivables
|
228,202
|
|
|
74,162
|
|
Long-term restricted cash
|
180,361
|
|
|
425
|
|
22.
|
INVESTMENTS IN AVAILABLE-FOR-SALE SECURITIES
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
Golar Partners (see note 13)
|
25,530
|
|
|
275,307
|
|
23.
|
COST METHOD INVESTMENTS
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
Golar Partners (see note 13)
|
196,825
|
|
|
196,825
|
|
OLT Offshore LNG Toscana S.p.A ("OLT–O")
|
7,347
|
|
|
7,347
|
|
|
204,172
|
|
|
204,172
|
|
24.
|
OTHER NON-CURRENT ASSETS
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
Mark-to-market interest rate swaps valuation (see note 32)
|
5,330
|
|
|
12,603
|
|
Other long-term assets
|
45,520
|
|
|
55,839
|
|
|
50,850
|
|
|
68,442
|
|
25.
|
ACCRUED EXPENSES
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
Vessel operating and drydocking expenses
|
5,003
|
|
|
13,443
|
|
Administrative expenses
|
11,460
|
|
|
6,054
|
|
Interest expense
|
36,870
|
|
|
11,627
|
|
|
53,333
|
|
|
31,124
|
|
26.
|
OTHER CURRENT LIABILITIES
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
Deferred drydocking, operating cost and charterhire revenue
|
1,327
|
|
|
9,514
|
|
Mark-to-market interest rate swaps valuation (see note 32)
|
4,597
|
|
|
3,038
|
|
Mark-to-market equity swaps valuation (see note 32)
|
81,581
|
|
|
13,656
|
|
Provision in relation to
Golar Viking
claim
|
—
|
|
|
13,848
|
|
Guarantees issued to Golar Partners (see note 33)
|
6,096
|
|
|
2,246
|
|
Dividends payable
|
40,466
|
|
|
—
|
|
Other
|
14,516
|
|
|
4,621
|
|
|
148,583
|
|
|
46,923
|
|
27.
|
DEBT
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
Total long-term and short-term debt
|
1,878,061
|
|
|
1,380,787
|
|
Less: current portion of long-term debt and short-term debt
|
(501,618
|
)
|
|
(116,431
|
)
|
Long-term debt
|
1,376,443
|
|
|
1,264,356
|
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
|
Maturity date
|
Golar Arctic facility
|
80,200
|
|
|
87,500
|
|
|
2019
|
Golar Viking facility
|
—
|
|
|
82,000
|
|
|
2017
|
Golar Viking (2015)
|
62,500
|
|
|
—
|
|
|
2020
|
Convertible bonds
|
243,369
|
|
|
238,037
|
|
|
2017
|
GoFLNG Hilli facility
|
50,000
|
|
|
—
|
|
|
2017
|
Hilli shareholder loans:
|
|
|
|
|
|
||
- Keppel loan
|
44,066
|
|
|
35,572
|
|
|
2027
|
- B&V loan
|
5,000
|
|
|
5,000
|
|
|
2027
|
$1.125 billion facility:
|
|
|
|
|
|
||
- Golar Seal facility
|
106,612
|
|
|
117,273
|
|
|
2018/2025*
|
- Golar Celsius facility
|
107,020
|
|
|
117,721
|
|
|
2018/2025*
|
- Golar Crystal facility
|
111,941
|
|
|
122,602
|
|
|
2019/2026*
|
- Golar Penguin facility
|
118,144
|
|
|
128,885
|
|
|
2019/2026*
|
- Golar Bear facility
|
118,524
|
|
|
129,299
|
|
|
2019/2026*
|
- Golar Frost facility
|
120,357
|
|
|
131,298
|
|
|
2019/2026*
|
Subtotal
|
1,167,733
|
|
|
1,195,187
|
|
|
|
ICBC VIE loans:
|
|
|
|
|
|
||
- Golar Glacier facility
|
177,176
|
|
|
185,600
|
|
|
2016/2024**
|
- Golar Snow facility
|
178,566
|
|
|
—
|
|
|
2016/2025**
|
- Golar Kelvin facility
|
182,540
|
|
|
—
|
|
|
**
|
- Golar Ice facility
|
172,046
|
|
|
—
|
|
|
**
|
Total debt
|
1,878,061
|
|
|
1,380,787
|
|
|
|
Tranche
|
Amount
|
Proportion of facility
|
Term of loan from date of drawdown
|
Repayment terms
|
K-Sure
|
$449.0 million
|
40%
|
12 years
|
Six-monthly installments
|
KEXIM
|
$450.0 million
|
40%
|
12 years
|
Six-monthly installments
|
Commercial
|
$226.0 million
|
20%
|
5 years
|
Six-monthly installments, unpaid balance to be refinanced after 5 years
|
Date of drawdown
|
Vessel
|
$1.125 billion facility
|
Amount drawn down
|
October 2013
|
Golar Seal*
|
$133.2 million
|
$127.9 million
|
October 2013
|
Golar Celsius
|
$133.2 million
|
$128.4 million
|
May 2014
|
Golar Crystal
|
$133.2 million
|
$127.9 million
|
September 2014
|
Golar Penguin
|
$133.2 million
|
$128.9 million
|
September 2014
|
Golar Bear
|
$133.2 million
|
$129.3 million
|
October 2014
|
Golar Frost
|
$134.8 million
|
$131.3 million
|
February 2014
|
Golar Igloo**
|
$161.3 million
|
$161.3 million
|
December 2014
|
Golar Eskimo***
|
$162.8 million
|
$162.8 million
|
As at December 2014
|
|
$1,125 million
|
$1,098 million
|
28.
|
OTHER LONG-TERM LIABILITIES
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
Deferred gain on sale of
Golar Maria
(see note 6)
|
15,145
|
|
|
15,650
|
|
Pension obligations (see note 29)
|
36,279
|
|
|
38,670
|
|
Guarantees issued to Golar Partners (see note 33)
|
16,493
|
|
|
19,271
|
|
Other
|
1,308
|
|
|
1,849
|
|
|
69,225
|
|
|
75,440
|
|
29.
|
PENSIONS
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
|
2013
|
|
Employers' contributions
|
1,035
|
|
|
684
|
|
|
533
|
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
|
2013
|
|
Service cost
|
379
|
|
|
369
|
|
|
468
|
|
Interest cost
|
2,042
|
|
|
2,359
|
|
|
2,159
|
|
Expected return on plan assets
|
(946
|
)
|
|
(984
|
)
|
|
(918
|
)
|
Recognized actuarial loss
|
1,195
|
|
|
998
|
|
|
1,415
|
|
Net periodic benefit cost
|
2,670
|
|
|
2,742
|
|
|
3,124
|
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
Reconciliation of benefit obligation:
|
|
|
|
||
Benefit obligation at January 1
|
53,166
|
|
|
50,564
|
|
Service cost
|
379
|
|
|
369
|
|
Interest cost
|
2,042
|
|
|
2,359
|
|
Actuarial (gain) loss
|
(2,547
|
)
|
|
3,700
|
|
Foreign currency exchange rate changes
|
(509
|
)
|
|
(686
|
)
|
Benefit payments
|
(3,058
|
)
|
|
(3,140
|
)
|
Benefit obligation at December 31
|
49,473
|
|
|
53,166
|
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
Reconciliation of fair value of plan assets:
|
|
|
|
||
Fair value of plan assets at January 1
|
14,496
|
|
|
14,919
|
|
Actual return on plan assets
|
(155
|
)
|
|
896
|
|
Employer contributions
|
2,411
|
|
|
2,459
|
|
Foreign currency exchange rate changes
|
(500
|
)
|
|
(638
|
)
|
Benefit payments
|
(3,058
|
)
|
|
(3,140
|
)
|
Fair value of plan assets at December 31
|
13,194
|
|
|
14,496
|
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
Projected benefit obligation
|
(49,473
|
)
|
|
(53,166
|
)
|
Fair value of plan assets
|
13,194
|
|
|
14,496
|
|
Funded status
(1)
|
(36,279
|
)
|
|
(38,670
|
)
|
|
December 31, 2015
|
|
December 31, 2014
|
||||||||||||||
(in thousands of $)
|
UK Scheme
|
|
|
Marine Scheme
|
|
|
Total
|
|
|
UK Scheme
|
|
|
Marine Scheme
|
|
|
Total
|
|
Projected benefit obligation
|
(10,145
|
)
|
|
(39,328
|
)
|
|
(49,473
|
)
|
|
(11,163
|
)
|
|
(42,003
|
)
|
|
(53,166
|
)
|
Fair value of plan assets
|
10,277
|
|
|
2,917
|
|
|
13,194
|
|
|
10,383
|
|
|
4,113
|
|
|
14,496
|
|
Funded status at end of year
|
132
|
|
|
(36,411
|
)
|
|
(36,279
|
)
|
|
(780
|
)
|
|
(37,890
|
)
|
|
(38,670
|
)
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
Equity securities
|
9,620
|
|
|
10,032
|
|
Debt securities
|
3,032
|
|
|
4,004
|
|
Cash
|
542
|
|
|
460
|
|
|
13,194
|
|
|
14,496
|
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
Net actuarial loss
|
12,400
|
|
|
15,251
|
|
Marine scheme
|
Target allocation 2016 (%)
|
|
2015 (%)
|
|
2014 (%)
|
Equity
|
30-65
|
|
30-65
|
|
30-65
|
Bonds
|
10-50
|
|
10-50
|
|
10-50
|
Other
|
20-40
|
|
20-40
|
|
20-40
|
Total
|
100
|
|
100
|
|
100
|
UK scheme
|
Target allocation 2016 (%)
|
|
2015 (%)
|
|
2014 (%)
|
Equity
|
75.0
|
|
75.7
|
|
69.0
|
Bonds
|
25.0
|
|
24.3
|
|
31.0
|
Total
|
100
|
|
100
|
|
100
|
(in thousands of $)
|
UK scheme
|
|
Marine scheme
|
|
|
Employer contributions
|
592
|
|
|
1,800
|
|
|
2015
|
|
|
2014
|
|
Discount rate
|
4.34
|
%
|
|
3.95
|
%
|
Rate of compensation increase
|
2.07
|
%
|
|
2.21
|
%
|
|
2015
|
|
|
2014
|
|
Discount rate
|
3.95
|
%
|
|
4.60
|
%
|
Expected return on plan assets
|
6.75
|
%
|
|
6.75
|
%
|
Rate of compensation increase
|
2.21
|
%
|
|
2.71
|
%
|
30.
|
SHARE CAPITAL AND SHARE OPTIONS
|
(in thousands of $, except per share data)
|
2015
|
|
|
2014
|
|
150,000,000 (2014: 150,000,000) common shares of $1.00 each
|
150,000
|
|
|
150,000
|
|
(in thousands of $, except per share data)
|
2015
|
|
|
2014
|
|
93,546,663 (2014: 93,414,672) outstanding issued common shares of $1.00 each
|
93,547
|
|
|
93,415
|
|
(in thousands of $, except per share data)
|
Shares
(in '000s)
|
|
|
Weighted average exercise price
|
|
|
Weighted average remaining contractual term
(years)
|
|
Options outstanding at December 31, 2012
|
581
|
|
|
$
|
7.86
|
|
|
0.8
|
Exercised during the year
|
(76
|
)
|
|
$
|
8.01
|
|
|
|
Forfeited during the year
|
(7
|
)
|
|
$
|
6.58
|
|
|
|
Options outstanding at December 31, 2013
|
498
|
|
|
$
|
6.36
|
|
|
0.3
|
Granted during the year
|
1,793
|
|
|
$
|
58.26
|
|
|
|
Exercised during the year
|
(185
|
)
|
|
$
|
7.20
|
|
|
|
Options outstanding at December 31, 2014
|
2,106
|
|
|
$
|
49.75
|
|
|
4.4
|
Exercised during the year
|
(132
|
)
|
|
$
|
1.70
|
|
|
|
Forfeited during the year
|
(685
|
)
|
|
$
|
56.75
|
|
|
|
Granted during the year
|
906
|
|
|
$
|
56.63
|
|
|
|
Options outstanding at December 31, 2015
|
2,195
|
|
|
$
|
52.02
|
|
|
3.9
|
31.
|
ACCUMULATED OTHER COMPREHENSIVE (LOSS) INCOME
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
|
2013
|
|
Net gain (loss) on qualifying cash flow hedging instruments
|
(246
|
)
|
|
4,671
|
|
|
(1,822
|
)
|
Net (loss) gain on available-for-sale securities
|
(28,608
|
)
|
|
15,751
|
|
|
7,796
|
|
Losses associated with pensions, net of tax recoveries of $nil (2014: $0.2 million)
|
(12,400
|
)
|
|
(15,251
|
)
|
|
(12,731
|
)
|
Accumulated other comprehensive (loss) income
|
(41,254
|
)
|
|
5,171
|
|
|
(6,757
|
)
|
|
Gains (losses) on available-for-sale securities
|
Pension and post retirement benefit plan adjustments
|
Gains (losses) on cash flow hedges
|
Share of affiliates comprehensive income
|
Total accumulated comprehensive (loss) income
|
|||||
Balance at December 31, 2012
|
5,911
|
|
(17,809
|
)
|
(6,832
|
)
|
—
|
|
(18,730
|
)
|
Other comprehensive income before reclassification
|
12,680
|
|
5,078
|
|
4,148
|
|
854
|
|
22,760
|
|
Amount reclassified from accumulated other comprehensive (loss) income
|
(10,795
|
)
|
—
|
|
8
|
|
—
|
|
(10,787
|
)
|
Net current-period other comprehensive income
|
1,885
|
|
5,078
|
|
4,156
|
|
854
|
|
11,973
|
|
Balance at December 31, 2013
|
7,796
|
|
(12,731
|
)
|
(2,676
|
)
|
854
|
|
(6,757
|
)
|
Other comprehensive income (loss) before reclassification
|
7,955
|
|
(2,520
|
)
|
3,483
|
|
(225
|
)
|
8,693
|
|
Amount reclassified from accumulated other comprehensive income
|
—
|
|
—
|
|
3,235
|
|
—
|
|
3,235
|
|
Net current-period other comprehensive income (loss)
|
7,955
|
|
(2,520
|
)
|
6,718
|
|
(225
|
)
|
11,928
|
|
Balance at December 31, 2014
|
15,751
|
|
(15,251
|
)
|
4,042
|
|
629
|
|
5,171
|
|
Other comprehensive (loss) income before reclassification
|
(31,453
|
)
|
2,851
|
|
—
|
|
(875
|
)
|
(29,477
|
)
|
Amount reclassified from accumulated other comprehensive income
|
(12,906
|
)
|
—
|
|
382
|
|
—
|
|
(12,524
|
)
|
Net current-period other comprehensive (loss) income
|
(44,359
|
)
|
2,851
|
|
382
|
|
(875
|
)
|
(42,001
|
)
|
Transfer of additional paid in capital
|
—
|
|
—
|
|
(4,424
|
)
|
—
|
|
(4,424
|
)
|
Balance at December 31, 2015
|
(28,608
|
)
|
(12,400
|
)
|
—
|
|
(246
|
)
|
(41,254
|
)
|
Details of accumulated other comprehensive (loss) income components
|
Amounts reclassified from accumulated other comprehensive (loss) income
|
Affected line item in the statement of operations
|
|||||
|
2015
|
2014
|
2013
|
|
|||
Gains on available-for-sale securities:
|
|
|
|
|
|||
Available-for-sale securities (Golar Partners)
|
(12,906
|
)
|
—
|
|
(10,710
|
)
|
Other non-operating income
|
Available-for-sale securities (Gaslog)
|
—
|
|
—
|
|
(85
|
)
|
Other non-operating income
|
|
(12,906
|
)
|
—
|
|
(10,795
|
)
|
|
(Gains) losses on cash flow hedges:
|
|
|
|
|
|||
Foreign currency swap
|
—
|
|
—
|
|
(718
|
)
|
Other financial items, net
|
Interest rate swap
|
382
|
|
3,235
|
|
(1,644
|
)
|
Other financial items, net
|
Interest rate swap
|
—
|
|
—
|
|
2,370
|
|
Gain on sale of
Golar Maria
|
|
382
|
|
3,235
|
|
8
|
|
|
Total reclassifications for the year
|
(12,524
|
)
|
3,235
|
|
(10,787
|
)
|
|
32.
|
FINANCIAL INSTRUMENTS
|
Instrument
(in thousands of $)
|
|
Year end
|
|
Notional value
|
|
|
Maturity Dates
|
|
Fixed Interest Rates
|
Interest rate swaps:
|
|
|
|
|
|
|
|
|
|
Receiving floating, pay fixed
|
|
2015
|
|
1,250,000
|
|
|
2018/ 2021
|
|
1.13% to 1.94%
|
Receiving floating, pay fixed
|
|
2014
|
|
1,475,937
|
|
|
2015/ 2021
|
|
1.13% to 4.52%
|
(in thousands of $)
|
Effective portion gain/ (loss) reclassified from Accumulated Other Comprehensive Loss
|
|
Ineffective Portion
|
||||||||||||||
Derivatives designated as hedging instruments
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
Interest rate swaps
Other financial items, net
|
382
|
|
|
3,235
|
|
|
(1,644
|
)
|
|
—
|
|
|
876
|
|
|
542
|
|
Interest rate swaps
Gain on sale of the
Golar Maria
, net
|
—
|
|
|
—
|
|
|
2,370
|
|
|
—
|
|
|
—
|
|
|
—
|
|
(in thousands of $)
|
Amount of gain recognized in other comprehensive income on derivative (effective portion)
|
|||||||
Derivatives designated as hedging instruments
|
2015
|
|
|
2014
|
|
|
2013
|
|
Interest rate swaps
|
—
|
|
|
3,483
|
|
|
4,148
|
|
|
Fair value
|
|
2015
|
|
|
2015
|
|
|
2014
|
|
|
2014
|
|
(in thousands of $)
|
Hierarchy
|
|
Carrying Value
|
|
|
Fair Value
|
|
|
Carrying Value
|
|
|
Fair Value
|
|
Non-Derivatives:
|
|
|
|
|
|
|
|
|
|
||||
Cash and cash equivalents
|
Level 1
|
|
105,235
|
|
|
105,235
|
|
|
191,410
|
|
|
191,410
|
|
Restricted cash and short-term receivables
|
Level 1
|
|
408,563
|
|
|
408,563
|
|
|
74,587
|
|
|
74,587
|
|
Investment in available-for-sale securities
|
Level 1
|
|
25,530
|
|
|
25,530
|
|
|
275,307
|
|
|
275,307
|
|
Cost method investments
(1)
|
Level 3
|
|
204,172
|
|
|
82,564
|
|
|
204,172
|
|
|
248,314
|
|
Short-term debt due from related parties
(2)
|
Level 2
|
|
—
|
|
|
—
|
|
|
20,000
|
|
|
20,000
|
|
Short-term loans receivable
(2)
|
Level 2
|
|
6,375
|
|
|
6,375
|
|
|
8,141
|
|
|
8,141
|
|
Short-term debt
(2)
|
Level 2
|
|
408,978
|
|
|
408,978
|
|
|
108,781
|
|
|
108,781
|
|
Current portion of long-term debt
(3)
|
Level 2
|
|
92,640
|
|
|
92,640
|
|
|
7,650
|
|
|
7,650
|
|
Long-term debt – convertible bond
(3)
|
Level 2
|
|
243,369
|
|
|
231,945
|
|
|
238,037
|
|
|
251,555
|
|
Long-term debt
(3)
|
Level 2
|
|
1,133,074
|
|
|
1,133,074
|
|
|
1,026,319
|
|
|
1,026,319
|
|
Derivatives:
|
|
|
|
|
|
|
|
|
|
||||
Interest rate swaps asset
(4) (5)
|
Level 2
|
|
5,330
|
|
|
5,330
|
|
|
12,603
|
|
|
12,603
|
|
Interest rate swaps liability
(4) (5)
|
Level 2
|
|
4,597
|
|
|
4,597
|
|
|
3,038
|
|
|
3,038
|
|
Total return equity swap liability
(6) (7)
|
Level 2
|
|
81,581
|
|
|
81,581
|
|
|
13,656
|
|
|
13,656
|
|
1.
|
The carrying value of our cost method investments includes our holdings in OLT Offshore LNG Toscana S.p.A (or OLT-O), but principally relates to our investments in Golar Partners (representing the general partner units and incentive distribution rights, or IDRs,
which were measured at fair value as of the deconsolidation date December 13, 2012 and subsequently
). The fair value of our IDRs held in Golar Partners is determined using a Monte Carlo simulation method, which takes into account the historical volatility, dividend yield and share price of their publicly traded common units.Similarly the general partner units’ fair value is based on the share price of their common units, but adjusted for restrictions over the transferability and reduction in voting rights. Accordingly, due to a fall in the share price of Golar Partners common units during the year, the fair value of our investments were lower than the carrying value. Refer to note 13 for further details.
|
2.
|
The carrying amounts of our short-term debts and loans receivable approximate their fair values because of the near term maturity of these instruments.
|
3.
|
Our debt obligations are recorded at amortized cost in the consolidated balance sheets.
|
4.
|
Derivative liabilities are captured within other current liabilities and derivative assets are captured within long-term assets on the balance sheet.
|
5.
|
The fair value of our derivative instruments is the estimated amount that we would receive or pay to terminate the agreements at the reporting date, taking into account current interest rates, foreign exchange rates, closing quoted market prices and our creditworthiness and that of our counterparties. The fair value/carrying value of interest rate swap agreements that qualify and are designated as cash flow hedges for accounting purposes as of December 31, 2014 was
$0.4 million
(with a notional amount of
$100.9 million
). We had no designated cash flow hedges for accounting purposes as of December 31, 2015.
|
6.
|
The fair value of total return equity swaps is calculated using the closing prices of the underlying listed shares, dividends paid since inception and the interest rate charged by the counterparty.
|
7.
|
The fair values of the equity derivatives are classified as other current liabilities in the balance sheet.
|
|
2015
|
2014
|
||||||||||
|
Gross amounts presented in the consolidated balance sheet
|
Gross amounts not offset in the consolidated balance sheet subject to netting agreements
|
Net amount
|
Gross amounts presented in the consolidated balance sheet
|
Gross amounts not offset in the consolidated balance sheet subject to netting agreements
|
Net amount
|
||||||
(in thousands of $)
|
|
|
|
|
|
|
||||||
Total asset derivatives
|
5,330
|
|
(216
|
)
|
5,114
|
|
12,603
|
|
(292
|
)
|
12,311
|
|
Total liability derivatives
|
4,597
|
|
(216
|
)
|
4,381
|
|
3,038
|
|
(292
|
)
|
2,746
|
|
33.
|
RELATED PARTY TRANSACTIONS
|
(in thousands of $)
|
|
2015
|
|
2014
|
|
2013
|
|
|
Transactions with Golar Partners and subsidiaries:
|
|
|
|
|
|
|
|
|
Management and administrative services fees revenue (i)
|
|
2,949
|
|
2,877
|
|
2,569
|
|
|
Ship management fees revenue (ii)
|
|
7,577
|
|
7,746
|
|
6,701
|
|
|
Charter-hire expenses (iii)
|
|
(41,555
|
)
|
—
|
|
—
|
|
|
Gain on disposals to Golar Partners (iv)
|
|
102,406
|
|
43,287
|
|
65,156
|
|
|
Interest income on vendor financing loan (v)
|
|
4,217
|
|
—
|
|
—
|
|
|
Interest expense on short-term credit facility
|
|
(203
|
)
|
—
|
|
—
|
|
|
Interest income on high-yield bonds (vi)
|
|
—
|
|
—
|
|
1,972
|
|
|
Share options expense recharge (x)
|
|
297
|
|
—
|
|
—
|
|
|
Total
|
|
75,688
|
|
53,910
|
|
76,398
|
|
|
(in thousands of $)
|
|
2015
|
|
|
2014
|
|
Trading balances (owing to) due from Golar Partners and subsidiaries (vii)
|
|
(4,400
|
)
|
|
13,453
|
|
Methane Princess lease security deposit movements (viii)
|
|
(2,728
|
)
|
|
(3,486
|
)
|
$20.0 million revolving credit facility (ix)
|
|
—
|
|
|
20,000
|
|
Total
|
|
(7,128
|
)
|
|
29,967
|
|
(in thousands of $)
|
2015
|
|
|
2014
|
|
|
2013
|
|
Frontline (i)
|
—
|
|
|
34
|
|
|
49
|
|
Seatankers (i)
|
—
|
|
|
(112
|
)
|
|
(45
|
)
|
Ship Finance (i)
|
—
|
|
|
116
|
|
|
207
|
|
Seadrill (i)
|
—
|
|
|
(5
|
)
|
|
—
|
|
Golar Wilhelmsen (ii)
|
(2,246
|
)
|
|
(7,031
|
)
|
|
(4,899
|
)
|
World Shipholding (iii)
|
—
|
|
|
—
|
|
|
(976
|
)
|
(in thousands of $)
|
2015
|
|
2014
|
|
Golar Wilhelmsen (ii)
|
—
|
|
(1,394
|
)
|
34.
|
CAPITAL COMMITMENTS
|
(in thousands of $)
|
|
Payable within 12 months to December 31, 2016
|
306,082
|
Payable within 12 months to December 31, 2017
|
374,376
|
|
680,458
|
(in thousands of $)
|
|
|
Payable within 12 months to December 31, 2016
|
49,500
|
|
Payable within 12 months to December 31, 2017
|
185,625
|
|
|
235,125
|
|
35.
|
OTHER COMMITMENTS AND CONTINGENCIES
|
(in thousands of $)
|
December 31, 2015
|
|
|
December 31, 2014
|
|
Book value of vessels secured against long-term loans*
|
2,543,012
|
|
|
1,997,657
|
|
36.
|
SUBSEQUENT EVENTS
|
B)
|
The Owner wishes to have the Vessel converted to a floating liquefied natural gas (“
FLNG
”) vessel, as specified in this Agreement, by the Contractor and has appointed the Sub-Contractor nominated by the Owner as the Contractor’s sub-contractor to carry out the Sub-Contract Works.
|
C)
|
The Contractor shall carry out and be responsible for the Contractor’s Scope on the terms and conditions set forth in this Agreement. The Sub-Contractor shall carry out and be responsible for the Topsides Scope as the Contractor’s sub-contractor. The Contractor shall perform its own obligations under the GANDRIA Topsides Agreement and use reasonably practicable endeavours (in accordance with the Contractor’s Scope) for the Sub-Contractor to perform its obligations under the GANDRIA Topsides Agreement.
|
D)
|
The Owner has provided the Contractor and the Sub-Contractor with the Basis of Design and the Owner Rely-Upon Information for the purpose of the front-end engineering design (“
FEED
”) of the Contractor’s Scope and the Topsides Scope.
|
E)
|
Relying on the Basis of Design and Owner Rely-Upon Information the Contractor carried out the FEED for the Contractor’s Scope and engaged the Sub-Contractor to carry out the FEED for the Topsides Scope (collectively the “
FEED Studies
”).
|
F)
|
It is acknowledged by the Parties that the documents referred to in the above Recital D and E were produced for the repair, modification and conversion of a vessel known as the
HILLI
, and shall be revised and updated in accordance with this Agreement. The Owner shall provide the Contractor and the Sub-Contractor with the Revised Basis of Design and the Revised Owner Rely-Upon Information to enable the Contractor to revise and update the FEED for the Contractor’s Scope, and the Sub-Contractor to update the FEED for the Sub-Contractor’s Scope, in reliance of such Revised Basis of Design and the Revised Owner Rely-Upon Information.
|
G)
|
Upon such revision and update, the Owner shall review the Revised FEED Studies and endorse the Revised FEED Studies. It shall be the Contractor and Sub-Contractor’s obligation to ensure that the portion of the Revised FEED Studies performed by it is in accordance with the Revised Basis of Design. The Contractor shall adopt the Revised FEED Studies for the design and engineering of the Contractor’s Scope, and the Sub-Contractor shall adopted the Revised FEED Studies for the Topsides Scope.
|
H)
|
The Owner recognises that the Contractor is reliant on the Sub-Contractor for the performance of the Topsides Scope.
|
I)
|
The Owner has had the opportunity to review and is aware of the terms of the GANDRIA Topsides Agreement.
|
1.
|
DEFINITIONS
|
1.1
|
In this Agreement, the following expressions shall have the following meanings except where the context requires otherwise:
|
1.1.1
|
“
Affiliate
” means, with respect to a company or legal entity, any other company or legal entity that, directly or indirectly, through one or more intermediaries, controls or is controlled by or is under common control with such company or legal entity. The term “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a company or legal entity, whether through the ownership of voting securities, by contract or otherwise;
|
1.1.2
|
“
Agreement
” means this Agreement comprising all of the Articles hereof and the Appendices referred to herein;
|
1.1.3
|
“
Anti-Bribery Laws
” shall mean the United States Foreign Corrupt Practices Act of 1977 and the United Kingdom Bribery Act of 2010 (as amended from time to time), and all other applicable national, regional, provincial, state, municipal or local laws and regulations that prohibit the bribery of, or the providing of unlawful gratuities, facilitation payments or other benefits to, any Government Official or any other person;
|
1.1.4
|
“
Applicable Laws
” means all national, municipal or state statutes, laws, ordinances, certifications, orders, decrees, licences, regulatory approvals, agreements, judgments, rules, and regulations, or other legislative or administrative action or official requirement of any Authority having jurisdiction over all or any part of the Works including Authorisations, with the exception of those at the Project Site;
|
1.1.5
|
“
Approved Vendor
” means any person listed in Appendix 8;
|
1.1.6
|
“
Article
” means an article of this Agreement. “
Articles
” shall accordingly refer to articles of this Agreement;
|
1.1.7
|
“
Authorisation
” means any permit, consent, approval, authorisation, agreement, no objection certificate, waiver or licence which must be obtained from any Authority by the Owner or the Contractor in connection with the Works or in order for the Works to be performed and for any portion of the Works to be transported, imported or exported;
|
1.1.8
|
“
Authority
” means any national, federal, regional, state, municipal or local government, and any division, body, ministry, department, instrumentality, agency, authority or other emanation of any of the same, including any court, commission, board, branch or similar authority of such government and any body empowered to grant, withdraw or determine the terms and conditions of any Authorisation;
|
1.1.9
|
“
Basis of Design
” means the basic engineering set out in Appendix 1A, which shall be revised and updated by the Owner pursuant to Article 3.3;
|
1.1.10
|
“
Business Day
” means a day on which banks are open for business in Singapore;
|
1.1.11
|
“
Certification Body
” means DNV while performing the function referred to in Article 8;
|
1.1.12
|
“
Certificate of Vessel Leaving The Yard
” means the document referred to in Article 20.1;
|
1.1.13
|
“
Change in Law”
means any change in Applicable Laws including any new or change in interpretation of any Applicable Laws by any Authority (excluding only any Applicable Laws with respect to taxes on or measured by the Contractor’s net income or its employees’ income or similar measurements or withholding) that is enacted after the Date of Agreement;
|
1.1.14
|
“
Classification Society
” or “
DNV
” means
Det Norske Veritas Germanischer Lloyd
;
|
1.1.15
|
“
Commissioning
” means inspections and testing to verify and document functionality and operability;
|
1.1.16
|
“
Commissioning Certificate
” means a certificate following successful Commissioning of the Works as referred to in Article 19.2;
|
1.1.17
|
“
Commissioning Spares
” means those replacement parts that may be required for Startup and Commissioning. For the avoidance of doubt, Commissioning Spares do not include operational or capital spares, which are to be provided by the Owner as Owner’s Spares;
|
1.1.18
|
“
Confidential Information
” shall have the meaning given to it in Article 39;
|
1.1.19
|
“
Contract Price
” means the total price for the performance of the Works and Sub-Contract Works, pursuant to Article 15 of this Agreement, and as the same may be adjusted in accordance with the provisions of this Agreement, including the Price Review;
|
1.1.20
|
"
Contractor Background Intellectual Property
" means the pre-existing Intellectual Property Rights of the Contractor and original drawings, specifications, reports and other Project Information which the Contractor prepares and delivers pursuant to this Agreement and/or the GANDRIA Topsides Agreement and any intellectual property of the Contractor developed, used or modified by the Contractor in the performance of the Works;
|
1.1.21
|
“
Contractor Guarantor
” means Keppel Offshore & Marine Ltd;
|
1.1.22
|
“
Contractor’s Group
” means, collectively, the group of entities and persons comprising of the Contractor, its Affiliates, its contractors and subcontractors at all tiers (excluding any member of the Sub-Contractor’s Group) and the representatives, agents, officers, directors, employees and personnel of each and every one of the foregoing entities but excluding any member of the Sub-Contractor’s Group;
|
1.1.23
|
“
Contractor’s Notice to Proceed
” shall have the same meaning as in the Topsides Agreement;
|
1.1.24
|
“
Contractor’s Scope
” means the scope of work set out in Appendix 1, as the same may be amended pursuant to the FEED Studies Update;
|
1.1.25
|
“
Conversion Price
” shall have the meaning given to it in Article 15.3 and as the same may be adjusted in accordance with the provisions of this Agreement, including the Price Review;
|
1.1.26
|
“
Date of Agreement
” shall have the meaning given to it in the recitals;
|
1.1.27
|
“
Day
” means a calendar day;
|
1.1.28
|
“
Default Interest Rate
” means eight per cent (8%) per annum;
|
1.1.29
|
“
Delivery
” means when the Vessel is delivered by the Owner to the Contractor in accordance with Article 5;
|
1.1.30
|
“
Delivery Certificate
” means a certificate in the form of Appendix 10;
|
1.1.31
|
“
Delivery Date
” shall be the date on or the period during which the Vessel is required under Article 5.2(a) of this Agreement to be delivered by the Owner to the Contractor;
|
1.1.32
|
“
Derivative Works
” means any minor or major change, elaboration, annotation, modification, new functions or features, new capability and improvement, update, upgrade, whether it is software, or copyrightable, patentable or not, made to the Owner Background Intellectual Property in whole or in part, by or on behalf of the Contractor or the Sub-Contractor, as the case may be, using, incorporating, based on, derived from or in relation to the Owner Background Intellectual Property. For the avoidance of doubt, Derivative Works do not include any improvement, invention, know-how, Intellectual Property Rights, software, work product or result of services, or any of the other items in the immediately preceding sentence, provided by the Contractor or the Sub-Contractor to the Contractor Background Intellectual Property or the Sub-Contractor Background Intellectual Property, as applicable, and the Intellectual Property Rights therein shall be retained by the Contractor and the Sub-Contractor respectively.
|
1.1.33
|
“
Directed Change
” shall have the meaning given to it in Article 13.3;
|
1.1.34
|
“
Disputed Difference
” shall have the meaning given to it in Article 13.3;
|
1.1.35
|
“
Early Works
” has the meaning given to it in Article 3.1;
|
1.1.36
|
“
Effective Date
” means the date on which all the conditions in Article 2 have been fulfilled;
|
1.1.37
|
“
Equipment
” means the system to be supplied by the Sub-Contractor for the liquefaction of natural gas, including front-end gas treatment and conditioning, that complies with the requirement(s) of the Revised FEED Study Report and with other terms and conditions of this Agreement. A reference to Equipment includes all the individual component equipment of the Equipment, as well as all the materials and equipment to be procured by the Sub-Contractor, for permanent installation on the Vessel;
|
1.1.38
|
“
Extended Warranty Period
” means the period stated in Article 34.5;
|
1.1.39
|
“
FEED Studies
” shall have the meaning given to it in recital E;
|
1.1.40
|
“
FEED Studies Update
” shall have the meaning given to it in Article 3.2.3;
|
1.1.41
|
“
FEED Study Report
” means the front end engineering design report prepared by the Sub-Contractor for the Contractor which is in Appendix C of the GANDRIA Topsides Agreement, as shall be updated pursuant to Clause 3.2.3 of the Topsides Agreement;
|
1.1.42
|
“
Final Acceptance
” means the successful completion of all Performance Tests at the Project Site and completion of the Topsides Scope as set out in Appendix O of the GANDRIA Topsides Agreement;
|
1.1.43
|
“
First Gas
” means the date when feed gas is first introduced to the Equipment after arrival of the Vessel at the Project Site;
|
1.1.44
|
“
Price Review
” shall have the meaning given to it in Article 15.14.1;
|
1.1.45
|
“
Fixed Price
” shall have the meaning given to it in Article 15.1;
|
1.1.46
|
“
Flag State Registry
” means the Marshall Islands Registry;
|
1.1.47
|
“
Force Majeure Event
” has the meaning given in Article 30.2;
|
1.1.48
|
“
GANDRIA
Direct Agreement
” means the direct agreement between the Owner, the Contractor and the Sub-Contractor dated on or about the date of this Agreement;
|
1.1.49
|
“
GANDRIA Topsides Agreement
” means the agreement between the Contractor and the Sub-Contractor, a copy of which is Appendix 2;
|
1.1.50
|
"
Government Official
" shall have the meaning ascribed to it in Article 48.1;
|
1.1.51
|
“
Guaranteed LNG Output
” shall have the meaning given in the GANDRIA Topsides Agreement;
|
1.1.52
|
“
Guaranteed Performance Certificate
” means the document referred to in Article 27.9;
|
1.1.53
|
“
HAZOP
” has the meaning given to it in Article 14.4;
|
1.1.54
|
“
Initial Payment
” shall have the same meaning as in the Topsides Agreement;
|
1.1.55
|
“Intellectual Property Rights
” means any and all rights of, in and to, wherever and whenever existing in: (a) any invention (whether or not patentable); (b) any and all patents, patent applications, together with all provisionals, reissuances, continuations, or divisionals thereof, any invention therein, and any related invention disclosures; (c) trademarks, service marks, trade dress, trade names, corporate names, other names, logos, brands, symbols, indicia of origin and/or design of any kind, in any language and/or any script, domain names and URLs; (d) copyright, mask works, any works (whether copyrightable or not), all copies therefrom, and including all applications, registrations, and renewals in connection therewith, whether based on statute or common law; (e) trade secrets, confidential information and other proprietary business information; (f) any translation, transliteration, copy, reproduction, manifestation, derivation or version of any of the foregoing, in any form or format whatsoever; and (g) all goodwill and reputation associated therewith; and all applications, registrations and renewals in connection therewith and thereto.
|
1.1.56
|
“
ITP Plan
” means the schedule of testing provided by the Contractor to the Owner in accordance with Article 11.10;
|
1.1.57
|
“
Limited Notice to Proceed
” has the meaning given in Article 3.1.3;
|
1.1.58
|
“
Mechanical Completion
” means that the Works and the Sub-Contract Works are mechanically, electrically and functionally complete, and ready for Pre-Commissioning;
|
1.1.59
|
“
Mechanical Completion Certificate
” means a certificate in the form in Appendix 10;
|
1.1.60
|
“
Milestone Achievement Certificate
” shall have the meaning prescribed in the GANDRIA Topsides Agreement;
|
1.1.61
|
“
Minimum Performance
” means when the liquefaction plant has achieved, in the aggregate, an average LNG output of at least 80 per cent of the Guaranteed LNG Output over a period of 72 consecutive hours.
|
1.1.62
|
“
Minimum Performance Certificate
” means the document referred to in Article 27.8;
|
1.1.63
|
“
OFE
” means all the equipment and other supplies specified in Appendix 4 to be furnished by the Owner to the Contractor in accordance with this Agreement;
|
1.1.64
|
“
Outstanding Works
” shall have the meaning ascribed to it in Article
17.2;
|
1.1.65
|
“
Owner Background Intellectual Property
” means the pre-existing Intellectual Property Rights of the Owner and original drawings, specifications, reports, and other engineering documents which the Owner prepares and delivers pursuant to this Agreement and any intellectual property of the Owner developed, used or modified by the Owner in the performance of its obligations in this Agreement;
|
1.1.66
|
“
Owner Rely-Upon Information”
means all the information contained in the documents listed in Appendix 1C, which shall be revised and updated by the Owner pursuant to Article 3.3;
|
1.1.67
|
“
Owner’s Group
” means, collectively, the group of entities and persons comprising of the Owner, its immediate customer(s) in respect of the Vessel, such customer’s or customers’ intermediate and ultimate clients (who can benefit from the use of or employment of the Vessel whether as a charterer of the Vessel or from the exploration or production of hydrocarbons or otherwise), the Affiliates of each and every one of the foregoing entities at all tiers, each and every one of the contractors and subcontractors, excluding any member of the Contractor’s Group or the Sub-Contractor’s Group, at all tiers of the foregoing entities, invitees or guests of the Owner, the registered (or beneficial) owner, manager and crew of the Vessel and the representatives, agents, officers, directors, employees and personnel of each and every one of the foregoing entities, but excluding any member of the Contractor’s Group or of the Sub-Contractor’s Group;
|
1.1.68
|
“
Owner’s Notice to Proceed
” means the written notice from the Owner to the Contractor authorising the Contractor to commence full performance of the Works, and directing the Contractor to authorise the Sub-Contractor to perform the full scope of the Sub-Contract Works via a Contractor’s Notice to Proceed;
|
1.1.69
|
“
Owner’s Representative
” shall be the representative of the Owner appointed pursuant to Article 11.1;
|
1.1.70
|
“
Owner’s Spares
” means the two-year operational and capital spares in respect of the Equipment that are OFE;
|
1.1.71
|
“
Parent Company Guarantee
” means the guarantee in the form set out in Appendix 10;
|
1.1.72
|
“
Parties
” means both the Contractor and the Owner. A “
Party
” means either the Contractor or the Owner;
|
1.1.73
|
“
Performance Guarantees
” means those guarantees by the Sub-Contractor specified in Appendix N of the GANDRIA Topsides Agreement;
|
1.1.74
|
“
Performance Tests
” means the tests set out in the Specifications to be carried out by the Owner with the assistance of the Sub-Contractor at the Project Site;
|
1.1.75
|
“
Permitted Delay Event
” means any one of the following:
|
(a)
|
any default or act of prevention of the Owner or act or omission of the Owner or any contractor engaged by the Owner; or
|
(b)
|
a Variation awarded in accordance with this Agreement; or
|
(c)
|
a technical dispute in respect of which the Classification Society upholds the Contractor’s views; or
|
(d)
|
defects that could not be detected by the Contractor using reasonable care and diligence; or
|
(e)
|
a Force Majeure Event; or
|
(f)
|
a delay to the Contractor’s Scope arising out of or in relation to the performance of the GANDRIA Topsides Agreement, except to the extent such delay is caused by the Contractor;
|
(g)
|
any error, defect, omission, ambiguity or discrepancy in the Revised Basis of Design or the Revised Owner Rely-Upon Information; or
|
(h)
|
a delay to the Contractor’s Scope resulting from events within the control of the Owner and/or any third party;
|
1.1.76
|
“
Plans
” mean drawings, documents and specifications which are required under this Agreement and the Specifications to be submitted to the Owner for approval;
|
1.1.77
|
“
Pre-Commissioning
” means those activities set out in Appendices J, K and Z of the GANDRIA Topsides Agreement as will be detailed in the pre-commissioning procedures to be developed by the Contractor based on the operations manual to be developed by the Sub-Contractor;
|
1.1.78
|
“
Pre-Commissioning Certificate
” means a certificate in the form of Appendix X of the GANDRIA Topsides Agreement;
|
1.1.79
|
“
PRICO
®
Licence Agreement
” means the agreement between the Owner and Black and Veatch Corporation pursuant to which Black and Veatch Corporation shall licence to the Owner certain PRICO
®
technology on the terms and conditions set forth therein;
|
1.1.80
|
“
Project Information
” shall mean all technical reports, data, designs, drawings, bill of materials, estimates, instructions, weight information, specifications, recommendations, certificates or other documents or information developed, provided by or on behalf of one party to another party (whether the Owner, the Contractor, or the Sub-Contractor) from time to time showing dimensions, work methods and any other details whatsoever of a technical nature for the purposes of the this Agreement, the GANDRIA Topsides Agreement, the FEED Study Report, and the Revised FEED Study Report;
|
1.1.81
|
“
Project Schedule
” means the schedule for the execution of the Works, as detailed in Appendix 1D, as may be amended from time to time in accordance with this Agreement;
|
1.1.82
|
“
Project Site
” means the location where the Project Site Works are to be carried out;
|
1.1.83
|
“
Project Site Commissioning
” means those activities set out in Appendices D, K and Z of the GANDRIA Topsides Agreement as will be detailed in the Project Site Commissioning procedures developed by the Sub-Contractor;
|
1.1.84
|
“
Project Site Personnel
” means all personnel provided by the Owner for the Project Site Works, to include, officers and crew, mechanics, labourers, skilled craftsmen, technicians, operators trained by the Sub-Contractor and all other personnel in sufficient quantity and quality to undertake in good time all activities required at or near the Project Site;
|
1.1.85
|
“
Project Site Works
” means the works and services to be performed by the Contractor and/or the Sub-Contractor after the Vessel has arrived at the Project Site and up to and including Final Acceptance (the Contractor’s role as specified in and forming part of the Contractor’s Scope and the Sub-Contractor’s role as specified in and forming part of the Sub-Contract Works), and the works and services to be performed at the Project Site by the Project Site Personnel, as more particularly described in Appendices D, K and Z of the GANDRIA Topsides Agreement;
|
1.1.86
|
“
Protocol of Mechanical Completion
” means the document in the form of Appendix 10;
|
1.1.87
|
“
Protocol of Redelivery and Acceptance
” means the document in the form of Appendix 10;
|
1.1.88
|
“
Provisional
Conversion Price
” shall have the meaning given to it in Article 15.3, and shall be revised and updated by the Contractor pursuant to the Price Review;
|
1.1.89
|
“
Prudent Engineering and Construction Practice
” means a thorough, efficient and workmanlike manner with due diligence and care by qualified and competent personnel, exercising that degree of skill and diligence which would ordinarily be expected from a skilled and experienced international contractor engaged in a similar undertaking to the Contractor’s Scope;
|
1.1.90
|
“
Ready for First Gas
” shall occur when the conditions set forth in Article 23.2 have been achieved;
|
1.1.91
|
“
Ready for First Gas Certificate
” means the certificate in the form of Appendix 10 issued in accordance with Article 23.2;
|
1.1.92
|
“
Ready for Startup Certificate
” means the certificate in the form of Appendix 10;
|
1.1.93
|
“
Redelivery
” means the final acceptance by the Owner of the Works in accordance with Article 20;
|
1.1.94
|
“
Redelivery Date
” shall be the date on which Redelivery is required to take place as established in accordance with Article 22 of this Agreement and Clause 27 of the GANDRIA Topsides Agreement;
|
1.1.95
|
“
Restricted Party
” means a person that is: (i) listed on, or owned or controlled by a person listed on, or acting on behalf of a person listed on, any Sanctions List; (ii) located in, incorporated under the laws of, or owned or (directly or indirectly) controlled by, or acting on behalf of, a person located in or organized under the laws of a country or territory that is the target of country-wide or territory-wide Sanctions; or (iii) otherwise a target of Sanctions (“target of Sanctions” signifying a person with whom a US person or other national of a Sanctions Authority would be prohibited or restricted by law from engaging in trade, business or other activities);
|
1.1.96
|
“
Revised Basis of Design
” means the revised and updated Basis of Design produced pursuant to Article 3.3;
|
1.1.97
|
“
Revised FEED Studies
” means the reviewed and updated Feed Studies produced pursuant to Article 3.2.3;
|
1.1.98
|
“
Revised FEED Study Report
” means the reviewed and updated FEED Study Report produced pursuant to Clause 3.2.3 of the Topsides Agreement;
|
1.1.99
|
“
Revised Owner Rely-Upon Information
” means the revised and updated Owner Rely-Upon Information produced pursuant to Article 3.3;
|
1.1.100
|
“
Sailaway
” means the departure of the Vessel from the anchorage or location referred to in Article 23;
|
1.1.101
|
“
Sanctions
” means the economic sanctions, laws, regulations, embargoes or restrictive measures administered, enacted or enforced by: (i) the United States government; (ii) the United Nations; (iii) the European Union; (iv) the United Kingdom; or (v) the respective governmental institutions and agencies of any of the foregoing, including, without limitation, the Office of Foreign Assets Control of the US Department of Treasury (“
OFAC
”), the United States Department of State, and Her Majesty’s Treasury (“
HMT
”) (together the “
Sanctions Authorities
”);
|
1.1.102
|
"
Sanctions List
" means the "Specially Designated Nationals and Blocked Persons" list maintained by OFAC, the
Consolidated List of Financial Sanctions Targets and the Investment Ban List maintained by HMT,
or
any similar list maintained by, or public announcement of Sanctions designation made by, any of the Sanctions Authorities;
|
1.1.103
|
“
Specifications
” means, collectively, the specifications and general drawing arrangements as contained in Appendix 1B, including any amendments thereto pursuant to the terms of this Agreement;
|
1.1.104
|
“
Startup
” means, for each train, that period of time beginning with the initial operation of the Equipment for the production of LNG and ending at achievement of Final Acceptance;
|
1.1.105
|
“
Sub-Contract Works
” means the product of work by the Sub-Contractor in the performance of the Topsides Scope;
|
1.1.106
|
“
Sub-Contractor Background Intellectual Property
” means the pre-existing Intellectual Property Rights of the Sub-Contractor and the original drawings, specifications, reports and other Project Information which the Contractor prepares and delivers pursuant to the GANDRIA Topsides Agreement and any intellectual property of the Sub-Contractor developed, used or modified by the Sub-Contractor in the performance of the Sub-Contract Works;
|
1.1.107
|
“
Subjective Error
” shall have the meaning given to it in Article 14.2;
|
1.1.108
|
“
Substantial Performance
” means when the liquefaction plant has achieved, in the aggregate, an average LNG output of at least 70 per cent of the Guaranteed LNG Output over a period of 72 consecutive hours;
|
1.1.109
|
“
Substantial Performance Certificate
” means the document referred to in Article 27.7;
|
1.1.110
|
“
Sub-Contractor
” means a consortium consisting each of Black and Veatch Corporation, Black and Veatch International Company, Black and Veatch Singapore Pte. Ltd., Black and Veatch (Beijing) Engineering Design Co. Ltd. and any other entity designated as the Sub-Contractor under the GANDRIA Topsides Agreement from time to time;
|
1.1.111
|
“
Sub-Contractor’s Group”
means, collectively, the group of entities and persons comprising of the Sub-Contractor, its Affiliates, its contractors and sub-contractors at all tiers and the representatives, agents, officers, directors, employees and personnel of each and every one of the foregoing entities;
|
1.1.112
|
“
Topsides Price
” means the price payable by the Owner to the Contractor under this Agreement in respect of the Sub-Contract Works;
|
1.1.113
|
“
Topsides Scope
” means the scope of work of the Sub-Contractor as stated in Appendix 2 ;
|
1.1.114
|
“
Third Party
” means a person who is not within the Contractor’s Group, the Owner’s Group or the Sub-Contractor’s Group;
|
1.1.115
|
“
Variation
” means a variation to the Contractor’s Scope or the Topsides Scope pursuant to Article 13;
|
1.1.116
|
“
Variation Order
” means a document referred to in Articles 13.1 and 13.2 in respect of a Variation;
|
1.1.117
|
“
Vessel
” means the
GANDRIA
, a Howaldtswerke Deutsche Werft Kiel - Germany LNG tanker owned on the Date of Agreement by the Owner, or such other vessel as the Parties may agree by a Variation Order in accordance with Article 13;
|
1.1.118
|
“
Vessel Leaving The Yard
” shall have the meaning given to it in Article 20.
|
1.1.119
|
“
Warranty Period
” means the period stated in Article 34.1;
|
1.1.120
|
“
Working Day
” means a day on which Works are being or are scheduled to be carried out by the Contractor, between Monday to Friday and excluding public holidays in the place where such Works are being or are scheduled to be carried out;
|
1.1.121
|
“
Works
” means the product of work by the Contractor in performance of the Contractor’s Scope; and
|
1.1.122
|
“
Yard
” means any of the shipyards occupied or operated by the Contractor or the Contractor’s Affiliates in Singapore.
|
1.2
|
For the avoidance of doubt, the reference to “contractors and sub-contractors at all tiers” shall be a reference to each and every person or entity: -
|
(a)
|
In the case of Contractor’s Group, who has been contracted by any person falling within the definition of the Contractor’s Group (including such person or entity) to perform any work and/or supply any materials, equipment or services in any way whatsoever related to the performance of the Contractor’s obligations or any part thereof under this Agreement; or
|
(b)
|
In the case of the Owner’s Group, who has been contracted by any person, falling within the definition of the Owner’s Group (including such person or entity) to perform any work and/or supply any materials, equipment or services in any way whatsoever related to or connected with the Vessel including, but not limited to, the supervision or inspection of the Vessel in its various stages of the Works or the supply and installation of equipment or machinery not within the scope of the Contractor’s obligations under this Agreement or the operation of the Vessel; or
|
(c)
|
In the case of the Sub-Contractor’s Group, who has been contracted by any person falling within the definition of the Sub-Contractor’s Group (including such person or entity) to perform any work and/or supply any materials, equipment or services in any way whatsoever related to the performance of the Sub-Contractor’s obligations or any part thereof under the GANDRIA Topsides Agreement.
|
1.3
|
Unless the context otherwise requires, the singular shall include the plural and the plural the singular, and words indicating persons shall include firms and corporations.
|
1.4
|
Article headings are inserted for convenience only and shall be ignored for the purposes of construction or interpretation.
|
1.5
|
The Appendices are:
|
•
|
Basis of Design
|
•
|
Outline specification of conversion (including such amendments as may be made pursuant to Article 3.2.3.1)
|
•
|
Specification of dry-docking and repair work
|
•
|
Owner Rely-Upon Information
|
•
|
Preliminary project schedule, including key milestone dates
|
•
|
Conversion scope
|
•
|
Annex 1: Re-measurable
|
•
|
Annex 2: Broken Down Repair Costs
|
1.6
|
The following documents together forming this Agreement are to be taken as mutually explanatory of one another. For the purposes of interpretation, the priority of the documents shall be in accordance with the following sequence:
|
a)
|
Articles 1-48 of this Agreement (excluding the Appendices);
|
b)
|
Clauses 1 – 61 of the GANDRIA Topsides Agreement;
|
c)
|
Revised Basis of Design;
|
d)
|
The Appendices of this Agreement in the order set out in Article 1.5 above; and
|
e)
|
The appendices of the GANDRIA Topsides Agreement in the order set out therein.
|
2.
|
EFFECTIVE DATE
|
2.1
|
With the exception of Articles 37, 39, 41, 43, 44, 45, and 46 (which shall enter into full force and effect on the Date of Agreement) the provisions of this Agreement shall become effective on the satisfaction (or waiver in accordance with Article 2.3) of the following:
|
2.1.1
|
the Contractor shall have provided to the Owner a Parent Company Guarantee pursuant to Article 47;
|
2.1.2
|
the Contractor shall have received from the Owner the sum of US$10,000,000 on or before 21 September 2015;
|
2.1.3
|
the GANDRIA Topsides Agreement shall have become effective pursuant to Clause 2 therein;
|
2.1.4
|
the Contractor shall have received from the Owner the sum of US$5,000,000 (as defined in Clause 2.1.2 of the GANDRIA Topsides Agreement) on or before 17 September 2015 so as to enable the Contractor to pay that amount to the Sub-Contractor by 21 September 2015 and notify the Owner of the same;
|
2.1.5
|
the PRICO
®
Licence Agreement shall have been executed by the Owner and Black and Veatch Corporation and all payment obligations thereunder, if any, are current;
|
2.1.6
|
the Owner, the Contractor and the Sub-Contractor shall have entered into the GANDRIA Direct Agreement; and
|
2.1.7
|
any other payment obligations under this Agreement due before the Effective Date shall have been paid in full.
|
2.2
|
Subject to Article 2.6, each Party undertakes, so far as is within its control, to use its reasonable endeavours to ensure the timely fulfilment of the conditions in Article 2.1. Each Party shall inform the other in writing promptly upon the fulfilment of all the above conditions that each Party is to fulfil.
|
2.3
|
The conditions in Article 2.1 may be waived only by agreement of both Parties in writing.
|
2.4
|
The Contractor and the Sub-Contractor shall only commence the Early Works and the Early Sub-Contract Works (if any) respectively from the Effective Date in accordance with Article 3.
|
2.5
|
If the conditions in Article 2.1 are not fulfilled or waived in accordance with Article 2.3 on or before 21 September 2015, either Party may terminate this Agreement by notice in writing given at any time before the Effective Date, whereupon this Agreement shall terminate and no Party shall have any claim against any other under it (including in circumstances where this Agreement has been terminated pursuant to this Article 2.5 if the Owner has not satisfied the conditions in Articles 2.1.2 and 2.1.4).
|
2.6
|
Without prejudice to Article 2.3, the Parties acknowledge and agree that the conditions in Articles 2.1.2 and 2.1.4 are for the benefit of the Owner and that the Contractor shall not be entitled, and waives any claim or right in respect thereof howsoever arising, to compel or otherwise bind the Owner to make such payments in order to satisfy the conditions precedent set out in Articles 2.1.2 and 2.1.4. For the avoidance of doubt but without limiting the preceding sentence or Article 2.5, the Owner shall not be entitled to waive the conditions in Articles 2.1.2 and 2.1.4 unilaterally.
|
3.
|
EARLY WORKS
|
3.1
|
After the Effective Date of this Agreement and the GANDRIA Topsides Agreement, but prior to the Contractor’s receipt of the Owner’s Notice to Proceed:
|
3.1.1
|
the Contractor shall only perform Works with the written agreement of the Owner and the Contractor, which shall not be unreasonably delayed or withheld (such consented Works shall be known as “
Early Works
”);
|
3.1.2
|
the Contractor shall only authorise the Sub-Contractor to perform Sub-Contract Works with the written agreement of the Owner, the Contractor and the Sub-Contractor in accordance with Clause 3 of the Topsides Agreement, which agreement shall not be unreasonably delayed or withheld (such consented Sub-Contract Works shall be known as “
Early Sub-Contract Works
”);
|
3.1.3
|
the agreement of the Owner and the Contractor for the Contractor’s performance of such Early Works (“
Limited Notice to Proceed
”) shall be in the form attached hereto at Appendix 10; and
|
3.1.4
|
the agreement of the Owner, the Contractor and the Sub-Contractor for the Sub-Contractor’s performance of such Early Such-Contract Works shall be in the form attached in Appendix X of the GANDRIA Topsides Agreement.
|
3.2
|
Pursuant to Article 3.1, above, the Owner acknowledges that the Contractor shall (and Articles 3.2.1 through 3.2.3 shall operate independently):
|
3.2.1
|
upon: (i) receipt of a Limited Notice to Proceed from the Owner to do so; and (ii) receipt of a payment from the Owner that is to be agreed between the Owner, the Contractor and the Sub-Contractor following receipt of such Limited Notice to Proceed; and (iii) agreement between the Owner, the Contractor and the Sub-Contractor of the cancellation cost payable by the Owner of such equipment (where cancellation takes place on or before 31 December 2016), instruct the Sub-Contractor to provide services necessary to place order(s) to duplicate those of the HILLI for the cold box from Chart that is to become a part of the Sub-Contract Works.
|
3.2.2
|
upon: (i) receipt of a Limited Notice to Proceed from the Owner to do so; and (ii) receipt of a payment from the Owner that is to be agreed between the Owner, the Contractor and the Sub-Contractor following receipt of such Limited Notice to Proceed; and (iii) agreement between the Owner, the Contractor and the Sub-Contractor of the cancellation cost payable by the Owner of such equipment (where cancellation takes place on or before 31 December 2016), instruct the Sub-Contractor to provide services necessary to place order(s) to duplicate those of the HILLI for the mixed refrigerant compressors from General Electric that is to become a part of the Sub-Contract Works.
|
3.2.3
|
upon the receipt of (i) the Revised Basis of Design and the Revised Owner Rely-Upon Information from the Owner pursuant to Article 3.3; and (ii) a Limited Notice to Proceed from the Owner to do so, perform and instruct the Sub-Contractor to perform the following respectively (collectively, the “
FEED Studies Update
”):
|
3.2.3.1
|
review and update the FEED for the Contractor’s Scope, making the necessary amendments to the FEED for the Contractor’s Scope and the Works (including, without limitation, the Outline specification of conversion in Appendix 1B) to reflect the impact of the differences between the
HILLI
and the Vessel on the Works. Such review and update shall take into account the results of the FEED Study Update performed by the Sub-Contractor pursuant to Clause 3.2.3 of the Topsides Agreement; and
|
3.2.3.2
|
instruct the Sub-Contractor to review and update the FEED for the Topsides Scope, and to make the necessary amendments to the FEED for the Sub-Contract Works and the Topsides Scope to reflect the impact of the differences between the
HILLI
and the Vessel on the Sub-Contract Works. Such review by the Sub-Contractor shall (i) include a review and update of the layout of the Equipment on the topsides of the Vessel; and (ii) take into account comments of the blast overpressure and design accidental loads review by the Contractor’s safety consultant.
|
3.3
|
Without prejudice to Article 4.3 and 15.14, the Owner shall, after the Effective Date but prior to instructing the Contractor and Sub-Contractor to perform the FEED Studies Update pursuant to Article 3.2.3, revise and update the Basis of Design and the Owner Rely-Upon Information to produce the Revised Basis of Design and the Revised Owner Rely-Upon Information respectively, and deliver the same to the Contractor and the Sub-Contractor. Upon the completion of the FEED Studies Update, the Owner shall endorse the Revised FEED Studies.
|
3.4
|
In performing Early Works, the Contractor shall endeavour to obtain (and instruct the Sub-Contractor, in its performance of the Early Sub-Contract Works, to obtain):
|
3.4.1
|
reasonably favourable cancellation terms (taking into account technical specification requirements and vendor delivery dates) when placing orders for materials and/or Equipment; and
|
3.4.2
|
an option from their vendors (if necessary) to adjust the latter’s delivery schedules to enable the Contractor to meet the adjustment of the Redelivery Date.
|
4.
|
OWNER’S NOTICE TO PROCEED
|
4.1
|
Provided that the FEED Studies Update has been completed, the Owner may, provided it has given the Contractor no less than 5 weeks’ written notice (such notice to be known as the “
Pre-NTP Notice
”) of the date on which it intends to issue the Owner’s Notice to Proceed, issue the Owner’s Notice to Proceed to the Contractor on a date between the Contractor’s completion of the Price Review and 31 December 2016, inclusive. Such Owner’s Notice to Proceed shall authorise the Contractor to perform the full scope of the Works, and direct the Contractor to authorise the Sub-Contractor to perform the full scope of the Sub-Contract Works (pursuant to Clause 4.1 of the GANDRIA Topsides Agreement).
|
4.2
|
Upon Contractor’s receipt of the Owner’s Notice to Proceed, the Contractor shall issue to the Sub-Contractor the Contractor’s Notice to Proceed (as defined in Clause 4.1 of the GANDRIA Topsides Agreement).
|
4.3
|
Within five Days following the Contractor's receipt of the Owner’s Notice to Proceed:
|
4.3.3
|
the Contractor shall have received documentary evidence satisfactory to it that a mortgage over the Vessel that is in the same form and substance as the Form of Vessel Mortgage set out in Appendix 10 hereto has been registered in its favour at the Office of the Deputy Commissioner of Maritime Affairs of the Republic of the Marshall Islands as a first preferred Marshall Islands ship mortgage which shall constitute a valid first preferred maritime lien on the Vessel under the laws of the Republic of the Marshall Islands in which the Vessel is registered;
|
4.3.4
|
the Contractor shall have received from the Owner payment of a sum equivalent to the difference between (i) the US$ 10,000,000 described in Article 2.1.2; and (ii) the First Instalment described in Article 15.4(a);
|
4.3.5
|
the Contractor shall have received from the Owner payment of the sum described in Clause 4.2.1 of the GANDRIA Topsides Agreement, so as to enable the Contractor to promptly pay that amount to the Sub-Contractor and notify the Owner of the same;
|
4.3.6
|
the Contractor shall have received written notices from both the Owner and the Sub-Contractor that all payment obligations under the PRICO® License Agreement are current; and
|
4.4
|
The date upon which all of the conditions in Article 4.3 are fulfilled shall be the effective date of the Owner’s Notice to Proceed.
|
4.5
|
Upon the effective date of the Owner’s Notice to Proceed, the Contractor shall perform the Works in accordance with the terms and conditions set out in this Agreement.
|
4.6
|
In the event that the Contractor does not receive the Owner’s Notice to Proceed by 31 December 2016, this Agreement shall be automatically terminated for the Owner’s convenience on 1 January 2017 pursuant to Article 33, unless the Owner, the Contractor and the Sub-Contractor (pursuant to Clause 4.8 of the GANDRIA Topsides Agreement) agree otherwise in writing. However, the notice provisions of Article 33.1 shall not apply in such circumstance.
|
4.7
|
In the event that the Contractor receives the Owner’s Notice to Proceed (after the FEED Studies Update), but the Parties subsequently fail to fulfil any of the conditions in Article 4.3.1, 4.3.2, 4.3.4 or 4.3.4 within the time stipulated, this Agreement shall be deemed to be automatically terminated for the Owner’s convenience on the following day pursuant to Article 33 unless the Owner, the Contractor and the Sub-Contractor all agree otherwise in writing. However, the notice provisions of Article 33.1 shall not apply in such circumstance.
|
5.
|
DELIVERY OF THE VESSEL
|
5.1
|
The Owner shall notify the Contractor in writing at least 60 Days, 30 Days and 15 Days in advance of the arrival of the Vessel at the Yard.
|
5.2
|
The Owner shall deliver the Vessel to the Contractor:
|
(a)
|
at the Yard and quayside (or in the vicinity thereof) notified in writing by the Contractor to the Owner at least 7 Days before the date and arrival of the Vessel, which shall be no earlier than 1 month after the effective date of the Owner’s Notice to Proceed (pursuant to Article 4.4) but no later than 5 months after the effective date of the Owner’s Notice to Proceed (pursuant to Article 4.4); and
|
(b)
|
with its tanks emptied, cleaned and gas-freed, as necessary in order for the Vessel to enter the Yard.
|
5.3
|
Upon Delivery of the Vessel by the Owner to the Contractor, the Owner shall execute a declaration that the Vessel is free and clear of all mortgages, liens, charges, encumbrances and other claims whatsoever (other than those in favour of the Contractor), and shall undertake, at its cost and expense, to maintain such status of the Vessel until Vessel Leaving The Yard.
|
5.4
|
Upon Delivery, the Parties shall execute the Delivery Certificate to evidence the delivery of the Vessel and the date thereof, whereupon Delivery shall have been accomplished.
|
5.5
|
Not later than Delivery, the Owner shall, at its own cost and expense, forthwith engage the Classification Society to determine and certify whether any repair and life extension works, additional to those set out in Appendix II will be required in respect of the Vessel. If additional work or repairs are required in respect of the Vessel, such additional work or repairs may if the Owner so requires be incorporated as part of the Works by a Variation Order in accordance with Article 13.
|
5.6
|
From Delivery to the time of Vessel Leaving The Yard in accordance with Article 20 the Vessel shall be in the possession of and at the risk of the Contractor, but title to the Vessel shall remain with the Owner.
|
5.7
|
For the avoidance of doubt, the Owner shall be responsible for all port dues incurred by the Vessel.
|
6.
|
PERFORMANCE OF THE WORKS
|
6.1
|
The Contractor shall perform the Works in accordance with:
|
(a)
|
Prudent Engineering and Construction Practice;
|
(b)
|
within the rules of the Classification Society as modified by Appendix 1B;
|
(c)
|
the Specifications;
|
(d)
|
Applicable Laws as at the Date of Agreement;
|
(e)
|
the rules, regulations and requirements of the Flag State Registry as at the Date of Agreement; and
|
(f)
|
and any other requirements of this Agreement.
|
6.2
|
The Owner recognises and accepts that the Contractor is reliant on the Owner-nominated Sub-Contractor for the performance of the Sub-Contract Works and does not have the capability to perform the Sub-Contract Works itself. It is the intention of the Parties that the Contractor does not undertake any of the obligations of the Sub-Contractor under the GANDRIA Topsides Agreement, but that the Works shall include but not be limited to the management and co-ordination of the Sub-Contract Works, including expediting the Sub-Contractor and the assembly, installation and integration of the Equipment in accordance with Prudent Engineering and Construction Practice.
|
6.3
|
All equipment and materials supplied by the Contractor in the performance of its obligations under this Agreement shall be new and unused (unless agreed otherwise), originally manufactured with certificates of quality and of the Classification Society where normally available. The Contractor shall obtain certificates of the Classification Society where normally available in respect of the Contractor’s Scope.
|
6.4
|
All old parts and equipment of the Vessel shall remain the property of the Owner and may be removed by the Owner if it wishes. All materials scrapped except the shaft and propeller shall become the property of the Contractor.
|
7.
|
DESIGN RESPONSIBILITY
|
7.1
|
The Owner shall at all times remain and be responsible for the Revised Basis of Design and the Revised Owner Rely-Upon Information. The Owner shall review the Revised FEED Studies and endorse the Revised FEED Studies. It shall be the Contractor’s and Sub-Contractor’s obligation to ensure that the portion of the Revised FEED Studies performed by it is in accordance with the Revised Basis of Design.
|
7.2
|
The Contractor shall at all times remain and be responsible for all design and engineering within the Contractor’s Scope, subject to Article 7.1.
|
7.3
|
It is acknowledged by the Parties that the Specifications in respect of the Contractor’s Scope set out in Appendix 1B have been developed by the Contractor pursuant to the FEED Studies based on and from the Basis of Design and Owner Rely-Upon Information provided by the Owner. Such Specifications shall be updated by the Contractor pursuant to the FEED Studies Update, based on and from the Revised Basis of Design and the Revised owner Rely-Upon Information provided by the Owner. The Contractor shall perform the detailed engineering for the Contractor’s Scope based on and from the Revised Basis of Design, the Revised Owner Rely-Upon Information, the Revised FEED Studies and all other requirements in this Agreement. Notwithstanding the above, the Parties acknowledge that certain portions of the Contractor’s Scope have been developed in reliance by the Contractor on information provided to it by the Sub-Contractor (including where updated pursuant to the FEED Studies Update).
|
7.4
|
It is acknowledged by the Parties that the Specifications in respect of the Topsides Scope set out in Appendix 2 have been developed by the Sub-Contractor pursuant to the FEED Study Report of November 2013 based on and from the Basis of Design and the Owner Rely-Upon Information. Such Specifications shall be reviewed and updated pursuant to the FEED Studies Update.
|
7.5
|
It shall be the Contractor and Sub-Contractor’s obligation to ensure that the portion of the Revised FEED Studies performed by it is in accordance with the Revised Basis of Design.
|
8.
|
CLASSIFICATION, CERTIFICATION AND DOCUMENTATION
|
8.1
|
The Works shall so far as applicable be performed in accordance with the rules (the edition and amendments thereto being in force as of the Date of Agreement) of the Classification Society and the Vessel shall be converted to the notation:
|
8.2
|
The Vessel’s topside’s engineering, equipment and installations are to be certified to be in accordance with DNV-OS-E201 (as at December 2012). Where the Certification Body requires further certification of equipment beyond that listed in Appendix L and Appendix M of the GANDRIA Topsides Agreement in order for the topsides to achieve compliance with DNV-OS-E201, the Contractor shall be entitled to claim such costs from the Owner as the Sub-Contractor is entitled to claim from the Contractor under the GANDRIA Topsides Agreement.
|
8.3
|
Decisions of the Classification Society as to compliance or non-compliance of the Works with its requirements shall be final and binding upon both Parties.
|
8.4
|
The Works shall also comply with Applicable Laws and with the rules, regulations and the requirements of the Flag State Registry in each case as in force at the Date of Agreement. Machinery and/or equipment supplied by the Contractor as part of the Works shall be provided with such maintenance/operation manuals, drawings, standard maker’s tools and spare parts, and maker’s certificate of origin as the Contractor may receive at no extra cost to it from the vendor.
|
8.5
|
All fees and charges incidental to the classification and with respect to compliance with the above referred Applicable Laws, rules, regulations and requirements in respect of the Contractor’s Scope shall be for the account of the Contractor. The Owner shall be responsible for all fees and expenses of the Classification Society save in respect of equipment certification.
|
8.6
|
The Owner shall at its own cost and expense keep the Vessel registered under the laws of the Flag State Registry from Delivery until Redelivery.
|
8.7
|
The GANDRIA Topsides Agreement provides that the Sub-Contractor shall deliver where appropriate certification of the Certification Body of the compliance of the relevant Equipment with DNV-OS-E201.
|
9.
|
FACILITIES FOR THE OWNER AT THE YARD
|
9.1
|
Within 30 Days of the Date of Agreement and until Redelivery, the Contractor shall provide the following facilities at the Yard for use by the Owner: -
|
(a)
|
Office space for up to ten (10) persons;
|
(b)
|
Two (2) international telephone and facsimile lines each;
|
(c)
|
One (1) facsimile/scanner/photocopier machine; and
|
(d)
|
Electronic mail facilities, including internet broadband connection complete with two standalone computers.
|
9.2
|
The Owner shall pay for all international telephone, facsimile, electronic mail and internet charges incurred by it. The Contractor shall pay for all domestic telephone and facsimile charges incurred by the Owner.
|
10.
|
SUB-CONTRACTING
|
10.1
|
The Contractor may, at its sole discretion and responsibility, subcontract part of the Works except that the Contractor:
|
(a)
|
shall only subcontract the Sub-Contract Works and the Early Sub-Contract Works to the Owner-nominated Sub-Contractor;
|
(b)
|
shall nominate any subcontractor, supplier or vendor from the Approved Vendor list for equipment it intends to procure. The Owner may within 7 days require the Contractor to select a different subcontractor, supplier or vendor from the list, carrying, through a Variation Order, any cost difference and schedule impact, which is to be reasonably proven by the Contractor. If the Contractor wishes to procure any equipment that is not listed in Appendix III, the Contractor shall obtain the prior written approval from the Owner, which shall not be unreasonably withheld or delayed; and
|
(c)
|
may not in the performance of the Works use or procure any materials or equipment which has been produced in Bangladesh or is supplied by a Bangladeshi supplier, vendor or subcontractor.
|
10.2
|
Subcontracting of all or any part of its obligations under this Agreement shall not relieve the Contractor from any of its obligations under this Agreement and the Contractor shall be responsible, only in the performance of the Works, for the acts or defaults of any of its subcontractors (other than the Sub-Contractor), its agents or employees, as if they were the acts or defaults of the Contractor itself.
|
11.
|
SUPERVISION, DRAWINGS, APPROVAL & INSPECTION & TESTS
|
11.1
|
The Owner shall within 30 Days after the Effective Date appoint at its own cost and expense, to the extent required by Prudent Engineering and Construction Practice, a properly qualified, competent and experienced representative who shall be duly authorized for and on behalf of the Owner (the “
Owner’s Representative
”) to supervise the Works . The Owner’s Representative shall have full authority to act for and on behalf of the Owner in all matters connected with this Agreement, to approve drawings, Plans, documentation, attend all tests and inspect all workmanship, equipment and materials during the course of the performance of the Works. The Owner’s Representative shall have full and free access at all reasonable times to inspect, check, request copies of calculations and samples of materials and make test of the Works as they are performed and shall inform the Contractor as soon as practicable if any particulars of the Works inspected do not comply with this Agreement. For all such purposes, the Owner’s Representative shall be given full and free access to the Yard and such other places of business of the Contractor (subject to compliance with safety rules and other work regulations applicable to such places) and its subcontractors, if any, and the Contractor shall ensure that such subcontractors are informed of the Owner’s Representative’s rights of access to their premises for such purposes. Failure of the Owner’s Representative to inspect or to call to the attention of the Contractor any particulars in which the Works do not comply with this Agreement shall in no way relieve the Contractor of its obligations under this Agreement. The Owner may by notice in writing inform the Contractor of any change in its appointment of the Owner’s Representative at any time at its own discretion.
|
11.2
|
The Owner’s Representative may delegate any of his powers to attend tests, inspect workmanship, equipment and materials to another properly qualified, competent and experienced person and to the extent that it elects to do so, the Contractor shall be entitled to rely on the actions of such person as if he were the Owner’s Representative for the purposes of the matters delegated to him.
|
11.3
|
The Contractor shall within thirty (30) Days of the Effective Date appoint and maintain at the Yard at its own cost and expense a properly qualified, competent and experienced representative (the “
Contractor’s Representative
”) to whom all enquiries of the Owner’s Representative shall be directed. The Contractor’s Representative shall have full authority to act for and on behalf of the Contractor in all matters connected with this Agreement. The Contractor’s Representative shall remain in this capacity and, so long as he remains in the Contractor’s employ, shall not be relieved until completion of the Works except upon prior written consent of the Owner, which shall not be unreasonably withheld or delayed.
|
11.4
|
All Plans required for the Works pursuant to this Agreement, shall be submitted to the Owner in one (1) hard copy and one (1) electronic copy.
|
11.5
|
The Owner shall within twelve (12) Days after receipt thereof return to the Contractor one (1) copy of such Plans with the Owner’s approval or with the Owner’s remarks and amendments (if any) written thereon. If no Owner comments are received within such period, the Contractor may continue on the basis that the Owner is deemed to have approved the submittal.
|
11.6
|
If the Owner makes any remarks or amendments in accordance with Article 11.5, the Contractor shall review and resubmit such Plans and resubmit a revised Plan as appropriate in one (1) copy for further review by the Owner within 5 Business Days. The scope of such second (and, if applicable, any subsequent) review of any resubmitted Plan shall be limited to the ambit of the Owner’s remarks and amendments of the previously submitted Plan and any subsequent review of the later Plan shall be subject to such limitation of the scope of review. The period for the second (and, if applicable, any subsequent) review shall not exceed six (6) Days after receipt of the resubmitted Plans from the Contractor. If no Owner comments are received within such period, the Contractor may continue on the basis that the Owner is deemed to have approved the submittal.
|
11.7
|
The Contractor shall take due note of the Owner’s remarks and amendments (if any) on the Plans submitted (or resubmitted) pursuant to this Article 11 and if such remarks or amendments are not of such a nature or extent as to constitute modifications to the Specifications, then the Contractor shall commence or continue the Works in accordance with the corrected or amended Plans. If such remarks or amendments are not clearly specified or detailed, the Contractor shall be entitled to seek clarification of the same from the Owner before implementing the same. The Owner’s acceptance or approval of such Plans shall not relieve the Contractor of its obligation to comply with the terms of this Agreement.
|
11.8
|
The Contractor shall arrange for the inspections and tests referred to in the ITP Plan to be carried out and ensure that all inspection and testing are carried out as require by the Classification Society, and as may otherwise be required under this Agreement to discover any deviations from the Specifications, or any defects in the Works or the Sub-Contract Works. The Owner’s Representative shall have, during the repair, modification and conversion of the Vessel, the right to attend such tests and inspections of the Works and of the Sub-Contract Works to the extent provided in the GANDRIA Topsides Agreement.
|
11.9
|
The Owner’s Representative may inspect the Works and equipment and materials supplied as part of the Works wherever the Works are being performed or the equipment and materials are being stored (including the Yard’s workshops, stores and offices of the Contractor or its subcontractors) to determine whether the Works are being performed in accordance with this Agreement and the Specifications.
|
11.10
|
The Contractor shall provide to the Owner the ITP Plan by 6 months after the Effective Date. The ITP Plan shall specify the anticipated schedule for equipment testing.
|
11.11
|
The Contractor shall, in relation to the Works which take place solely in the Yard, give the Owner’s Representative at least one (1) Working Day’s prior written notice of each inspection or test to be conducted at the Yard, and three (3) Days prior written notice for any other inspection or test which the Owner’s Representative separately identifies sufficiently in advance in writing as requiring such notice. In relation to the Sub-Contract Works which take place solely in the Yard , the Contractor shall give notice to the Owner’s Representative within one (1) Working Day of the Contractor’s receipt of notification from the Sub-Contractor of each inspection or test to be conducted. Provided such notice is given, the Contractor may proceed with any inspection or test which the Owner’s Representative fails to attend. The Owner shall be bound in such circumstances to accept the result of any such inspection or test although such result will still have to satisfy the requirements of the Classification Society to the extent required under this Agreement. The Owner (or its representatives) shall have no right to instruct the Sub-Contractor with regards to any portion of the Sub-Contract Works.
|
11.12
|
In relation to any Works which take place outside the Yard, the Contractor shall give the Owner’s Representative at least fifteen (15) Days’ prior notice of the proposed date, and for those tests and inspections which the Owner’s Representative confirms that it wishes to attend, five (5) Days’ prior notice of the actual date of such Works.
|
12.
|
PROGRESS REPORTING
|
12.1
|
The Contractor shall submit detailed monthly progress reports for the Works to the Owner containing a description of:
|
(a)
|
the work performed during the month, including a comparison of the current progress as compared with scheduled progress, together with a narrative on each item of the work; and
|
(b)
|
any present or anticipated slippage or other problem and the steps being taken to overcome it.
|
12.2
|
Beginning 25 months from the Effective Date, the Contractor shall also submit to the Owner a weekly summary report based on the information produced by the Contractor for its internal purposes.
|
12.3
|
The Contractor shall submit to the Owner copies of the progress reports for the Sub-Contract Works received from the Sub-Contractor.
|
13.
|
VARIATIONS AND MODIFICATIONS
|
13.1
|
The Contractor’s Scope and/or the Specifications may be modified and/or changed by written agreement of the Parties (a Variation) provided that such modifications and/or changes or an accumulation thereof will not in the Contractor's judgement (acting reasonably), materially adversely affect the Contractor's planning or program in relation to the Contractor's other commitments, and provided, further, that the Owner shall first agree, before such modifications and/or changes are carried out, to a Variation Order in respect of alterations in the Contract Price, the Redelivery Date and such other terms and conditions of this Agreement and Specifications occasioned by or resulting from such modifications and/or changes.
|
13.2
|
Such Variation shall constitute an amendment to this Agreement and/or the Specifications. No change in the Contractor’s Scope shall be made and no additional work shall be performed by the Contractor until a Variation Order has been written, dated and signed for identification by the authorised representatives of both Parties.
|
13.3
|
Notwithstanding the foregoing, where a change and/or modification is to be made to the Contractor’s Scope (but not the Sub-Contract Works), the Owner shall, subject to the limitations expressed in this Article 13, have the right to instruct the Contractor to perform such change (a “
Directed Change
”). The difference between the Contractor’s and the Owner’s proposed adjustment to the Contract Price shall be known as the “
Disputed Difference
”. The Owner shall not be entitled to issue a Directed Change, nor shall the Contractor be obliged to perform a Directed Change, where the Disputed Difference in respect of all Directed Changes (including the proposed Directed Change) exceeds the aggregate sum of Five Million United States Dollars U.S.$5m.
The Contractor’s obligation to adjust delivery dates under this Article 13 shall be conditioned upon the Contractor’s ability to obtain the corresponding adjustment from its suppliers. A Directed Change shall be paid for monthly by the Owner to the Contractor on a time and materials, cost plus basis in accordance with Appendix 3 pending resolution of the Disputed Difference.
|
13.4
|
The Owner may request changes to the Contractor’s Scope by altering, adding or deducting from it by giving a written request of such changes to the Contractor. Within seven (7) Days (provided always that the Owner’s request is clear and the details thereof are sufficient for the Contractor to work out the variation required) from delivery of the request, the Contractor will give notice to the Owner in writing of the alteration to the Specifications and (if any) to the Contract Price and/or the Redelivery Date. The Owner shall notify the Contractor in writing within three (3) Days of receipt of the Contractor’s notice whether or not it agrees to the change being carried out on such terms. A Variation shall be signed by the Parties if the Owner agrees to the change, otherwise the Contractor shall not make the change.
|
13.5
|
Further, if the Owner makes remarks or amendments on Plans or drawings submitted by the Contractor or requests the performance of specific work which in the Contractor’s reasonable opinion is not part of its obligations under this Agreement, then the Contractor may issue a notice in writing to the Owner setting out in sufficient detail the requested modification and any adjustment to the Contract Price and/or Redelivery Date and/or any other provision of this Agreement and/or the Specifications which the Contractor requires before performing the requested modification. The Owner shall notify the Contractor in writing within three (3) Days of receipt of the Contractor’s notice whether or not it agrees to the modification being carried out on such terms. A Variation Order shall be signed by the Parties if the Owner agrees to the change, otherwise the Contractor shall not make the change.
|
13.6
|
For modifications and/or changes agreed in a Variation Order to be performed on a lump-sum basis, payment shall be made by the Owner, unless otherwise agreed, in the following manner:
|
(i)
|
on the date of the Variation Order, payment of such percentage of the value of the Variation Order as is equivalent to the total percentage of the Conversion Price which has become due to the Contractor; and
|
13.7
|
In the event that any of the materials required by the Specifications or otherwise under this Agreement for the Contractor’s Scope cannot be procured in time or are in short supply to maintain the Redelivery Date, the Contractor may, provided that the Owner shall so agree in writing, supply other materials capable of meeting the requirements of the Classification Society and of the rules, regulations and requirements with which the repair, modification and conversion of the Vessel must comply. Any agreement as to such substitution of materials shall be effected in the manner provided in this Article 13 and shall likewise include alterations in the Contract Price and Redelivery Date and other terms and conditions of this Agreement occasioned by or resulting from such substitution.
|
13.8
|
Notwithstanding Articles 13.1 and 13.2, as regards the Sub-Contract Works, the Contractor shall have no obligation to instruct the Sub-Contractor to carry out such modifications and/or changes unless: (i) it is entitled to demand such modifications and/or changes from the Sub-Contractor; (ii) the Sub-Contractor and the Contractor agree a Variation Order in accordance with the GANDRIA Topsides Agreement; and (iii) a Variation Order is signed by the Owner and the Contractor as provided above. The Owner shall reimburse the Contractor for the cost to the Contractor of making such alterations and/or changes within 30 Days of the Contractor's invoice. In the event that the only disagreement between the Owner and the Contractor is the impact of a proposed modification and/or change to the Sub-Contract Works on the Topsides Price, the Owner may instruct the Contractor to instruct the Sub-Contractor to perform the modification and/or change in accordance with Clause 36.5 of the GANDRIA Topsides Agreement.
|
13.9
|
The Owner hereby undertakes not to request changes and/or modifications that increase or decrease the Contractor’s Scope or the Topsides Scope beyond the intent of the original scope.
|
13.10
|
If the Owner requests engineering services from the Contractor in the preparation of a Variation, and the Owner elects not to issue a Variation, the Owner shall compensate the Contractor for its costs incurred in the preparation and submittal of information and documents in response to the Owner’s request at the rates set out in Appendix 3. If requested by the Owner in writing, the Contractor shall provide a written cost estimate prior to responding to any of the Owner’s requests which may amount to a Variation.
|
13.11
|
For the avoidance of doubt, any changes to the Revised Basis of Design or the Revised Owner Rely-Upon Information shall constitute a modification and/or change to which this Article 13 applies.
|
13.12
|
The Contractor shall also be entitled to a Variation Order in respect of any additional work or delays caused by (a) any failure of the Owner to comply with its obligations under this Agreement resulting in an impact on the Contractor; (b) changes in applicable standards from those applicable at the Date of Agreement, (c) any Change in Law, after the Date of Agreement, (d) delays and extra costs after the Date of Agreement that are caused by a Force Majeure Event, (e) any changes in the results of the Revised FEED Study Report, (f) any Variation Order to which the Sub-Contractor is entitled pursuant to the GANDRIA Topsides Agreement.
|
14.
|
ERRORS AND CHANGES
|
14.1
|
The Contractor shall be entitled to a Variation Order in respect of adjustment of the Contract Price (calculated in accordance with Appendix 3) and in respect of delays to the Contractor’s Scope resulting from an Objective Error as defined in the GANDRIA Topsides Agreement, to the extent not compensated for by the Sub-Contractor under the GANDRIA Topsides Agreement.
|
14.2
|
The Contractor shall be entitled to a Variation Order in respect of adjustment of the Contract Price calculated in accordance with Appendix 3 and in respect of delays to the Works resulting from a Subjective Error as defined in the GANDRIA Topsides Agreement, to the extent not compensated for by the Sub-Contractor under the GANDRIA Topsides Agreement.
|
14.3
|
Without prejudice to the exercise of rights under Clause 56 of the GANDRIA Topsides Agreement, in the event that (i) there is any disagreement as to the Certification Body’s decision on whether the Sub-Contractor’s interpretation of the discretionary elements of DNV-OS-E201 was in accordance with Prudent Engineering and Construction Practice; (ii) there is any disagreement as to whether changes to the Sub-Contract Works arising from HAZOP are due to the Sub-Contractor’s Objective Error(s) and/or Subjective Error(s); or (iii) the Certification Body fails to provide such opinion within 30 days of the Sub-Contractor’s written request (copied to the Contractor and Owner), such disagreement or decision shall be referred to an independent third party. The independent third party will be retained by the Sub-Contractor subject to the mutual agreement of the Owner, which shall not be unreasonably withheld. The costs of the independent third party shall be paid by whichever of the Owner or the Sub-Contractor, or such combination of the foregoing, as the independent third party decides. Either the Owner or the Sub-Contractor may seek to have the independent third party’s ruling adjudicated under Clause 56 of the GANDRIA Topsides Agreement. The Owner shall, pending the decision of such independent third party, have the right to instruct the Contractor to instruct the Sub-Contractor to comply with the decision of the Certification Body.
|
14.4
|
The Contractor shall be entitled to a Variation Order in respect of adjustment of the Contract Price calculated in accordance with Appendix 3 and in respect of delays to the Works arising from a Hazard & Operability Analysis study (“
HAZOP
”), to the extent not compensated for by the Sub-Contractor under the GANDRIA Topsides Agreement.
|
15.
|
CONTRACT PRICE AND TERMS OF PAYMENT
|
15.1
|
The price for the performance of the Works (excluding the Re-measurable Scope, as defined in Article 15.2 below) shall be the sum of US$602,819,390 net receivable by the Contractor, (the “
Fixed Price
”) which is exclusive of the OFE and shall be subject to adjustment, if any, as hereinafter set forth in this Agreement.
|
15.2
|
The provisional price (“
Provisional Re-measurable Price
”) for the performance by the Contractor of the erection, installation and integration of the Topsides Scope, and for the performance of repair and life extension works of the Vessel, as set out in Appendix 3 (“
Re-measurable Scope
”) shall be the sum of US$81,183,332. The actual price for the performance by the Contractor of the Re-measurable Scope shall be based on a re-measurement of the actual work, materials and equipment required to carry out the Re-measurable Scope at the rates set out in Appendix 3 (“
Final Re-measurable Price
”), which the Contractor shall determine no later than 14 Days before Vessel Leaving The Yard. The Fourth Instalment shall be adjusted to take into account the difference between the Provisional Re-measurable Price and the Final Re-measurable Price through a Variation Order.
|
15.3
|
The total price for the performance of the Works (“
Conversion Price
”) shall be the total of the Fixed Price and the Final Re-measurable Price, which is exclusive of the Topsides Price and shall be subject to adjustment, if any, as provided in this Agreement. Pending ascertainment of the Final Re-measurable Price, the total of the Fixed Price and the Provisional Re-measurable Price is referred to as the “
Provisional Conversion Price
”.
|
15.4
|
The Owner shall pay the Contractor the Conversion Price in instalments as follows:
|
a)
|
the First Instalment of 30% of the Provisional Conversion Price shall be paid within five Days of the Contractor’s receipt of the Owner’s Notice to Proceed. For the avoidance of doubt, the amount already paid by the Owner pursuant to Article 2.1.2 shall count towards the payment of this First Instalment of 30% of the Provisional Conversion Price.
|
b)
|
the Second Instalment of 20% of the Provisional Conversion Price, together with payment for any Variations then due, shall be paid on completion of fabrication works for the sponsons by the Contractor.
|
c)
|
the Third Instalment of 10% of the Provisional Conversion Price, together with payment for any Variations then due, shall be paid on the earlier of: (i) the mechanical completion of the refrigerant compressor in the Works; or (ii) 25 months after the Effective Date.
|
d)
|
the Fourth Instalment of such amount as will result in the Contractor receiving a total of 93% of the Conversion Price taking into account payments already received by the Contractor in respect of the Provisional Conversion Price and the Topsides Credit referred to in Article 15.10 together with the aggregate of any increase or decrease of the Conversion Price arising from the provisions of this Agreement, and all other amounts then due to the Contractor from the Owner, or to the Owner from the Contractor pursuant to Article 29.3, shall be paid on Vessel Leaving The Yard.
|
e)
|
the Fifth Instalment of such amount as represents 2% of the Conversion Price, together with payment for any Variations then due, shall be paid on Redelivery.
|
f)
|
the Sixth Instalment of such amount as represents 2.5% of the Conversion Price, together with payment for any Variations then due, shall be paid on the earlier of: (i) Sailaway; or (ii) the expiry of 30 Days from Vessel Leaving The Yard.
|
g)
|
the Seventh Instalment of such amount as represents 1% of the Conversion Price, together with payment for any Variations then due, shall be paid on the earlier of: (i) First Gas; or (ii) the expiry of 120 Days from Vessel Leaving The Yard.
|
h)
|
the Eighth Instalment of such amount as represents 1.5% of the Conversion Price, together with payment for any Variations then due, shall be paid on the earlier of: (i) the date of achievement of Final Acceptance; or (ii) the expiry of 180 Days from Vessel Leaving The Yard.
|
15.5
|
The Contractor shall submit to the Owner an invoice for each payment referred to in Article 15.4 not later than 7 Business Days before the date when such payment is due.
|
15.6
|
The Owner shall pay to the Contractor such amounts as are due from the Contractor to the Sub-Contractor so as to enable the Contractor to pay such amounts to the Sub-Contractor in full when due. The Sub-Contractor shall submit an invoice to the Contractor each month for the milestones achieved and for progress pertaining to Variation Orders in the preceding month.
|
15.7
|
The Contractor shall deliver to the Owner copies of all Milestone Achievement Certificates received and approved by the Contractor from the Sub-Contractor. The Owner shall review and comment on each Milestone Achievement Certificate in good time to enable the Contractor to comply with Clause 7.8.1 of the GANDRIA Topsides Agreement.
|
15.8
|
The Contractor shall deliver to the Owner copies of all invoices received and approved by the Contractor by the Sub-Contractor together with an invoice in the same amount from the Contractor to the Owner. The Owner shall review and comment on each invoice in good time to enable the Contractor to comply with Clause 7.8 of the GANDRIA Topsides Agreement.
|
15.9
|
The Owner shall pay the amount invoiced by the Contractor and the Sub-Contractor in good time to enable the Contractor to comply with Clause 7.5 of the GANDRIA Topsides Agreement.
|
15.10
|
The Owner shall pay to the Contractor at the same time as payment of the First Instalment under Article 15.4 the additional sum of Five Million United States Dollars (U.S. $5,000,000) (the “
Topsides Credit
”). In the event that the Owner fails to make timely payment of any amount due to the Contractor in respect of the Sub-Contract Works, the Contractor shall make such payment from the Topsides Credit upon which the Owner shall forthwith pay to the Contractor by the last day of the same calendar month such amount as will restore the Topsides Credit to the aforementioned sum.
|
15.11
|
Such amount, if any, of the Topsides Credit remaining at Vessel Leaving The Yard shall be dealt with in accordance with Article 15.4d).
|
15.12
|
Payment of sums due to the Contractor under this Agreement shall be made without any discount, set off, deduction or withholding of any nature whatsoever by wire transfer free of all transfer charges to the Contractor’s bank account as may from time to time be designated and notified in writing (or as may be detailed in any invoice) to the Owner for credit to the account of the Contractor.
|
15.13
|
Interest shall accrue on any delayed payment at the Default Interest Rate (before or after judgment or arbitration award) until full payment is made.
|
15.14
|
Without prejudice to any other provisions of this Agreement expressly permitting adjustment of the Contract Price, the Contract Price shall be adjusted in accordance with the following to obtain a revised Contract Price (consisting of a revised Conversion Price and a revised Topsides Price) that shall automatically apply following such Price Review:
|
13.
|
|
15.15
|
The revised Contract Price obtained pursuant to the Price Review shall take into account, but not be limited to, the following:
|
13.1
|
the revised Topsides Price automatically applicable pursuant to Clause 7.11 of the GANDRIA Topsides Agreement;
|
13.1.1
|
increase in the cost of the labour component required to perform the Works at the rate of 0.66% per month, compared against the price estimates used by the Contractor to determine the original Conversion Price, but taking into consideration market conditions;
|
13.1.2
|
changes in the cost of bulk materials required for the Works;
|
13.1.3
|
changes in the cost of equipment and other materials required for the Works, as evidenced by good-faith revised price estimates provided by the Contractor’s suppliers of such equipment and materials compared against the price estimates for the same used by the Contractor to determine the original Conversion Price;
|
13.1.4
|
other material changes in market conditions relevant to performance of the Works;
|
13.1.5
|
changes to the Works, the Contractor’s Scope, and the Outline specification of conversion (as detailed in Appendix 1B), made pursuant to the FEED Studies Update;
|
13.1.6
|
changes in currency exchange rates;
|
13.1.7
|
changes in market competition for conversion projects performed by Singapore ship yards;
|
13.1.8
|
changes in market competition amongst vendors providing goods and/or services for ship conversion projects; and
|
13.1.9
|
changes in market competition amongst topsides providers of conversion projects.
|
15.16
|
The Contractor shall make available, at the Owner’s request, such information to support the changes in Article 15.15.4 at its Singapore offices for the Owner’s review.
|
15.17
|
For the avoidance of doubt, any increase in the Topsides Price shall be borne solely by the Owner.
|
16.
|
ADJUSTMENT OF CONTRACT PRICE
|
14.
|
The Contract Price shall be subject to adjustment, as set forth below, in the event of the following contingencies (it being understood by both Parties that any reduction of the Contract Price is by way of liquidated damages and not by way of penalty and that the remedies provided in this Article 16 shall constitute the Owner’s sole remedy for delay in the performance of the Contractor’s Scope and/or the Sub-Contract Works), provided that any reduction by way of liquidated damages shall only be made if the Owner has an arms length contract with a party unconnected with the Owner for the employment of the Vessel.
|
(a)
|
No adjustment shall be made and the Conversion Price shall remain unchanged for the first 15 Days of delay in Redelivery beyond the Redelivery Date (the “
Grace Period
”);
|
(b)
|
If Redelivery is delayed more than 15 Days beyond the Redelivery Date for reasons solely attributable to the Contractor, then in such event, beginning from the 16
th
Day after the Redelivery Date (i.e. the end of the Grace Period) until the end of two (2) calendar months from the end of the Grace Period, the Conversion Price shall be reduced by deducting the sum of fifty thousand United States Dollars (U.S.$50,000) per Day for each Day of delay beyond the expiry of the Grace Period.
|
(c)
|
If Redelivery is delayed more than two (2) calendar months beyond the end of the Grace Period for reasons solely attributable to the Contractor, then in such event, beginning from the third calendar month after the end of the Grace Period until the end of four calendar months after the end of the Grace Period, the Conversion Price shall be reduced by deducting the sum of seventy-five thousand United States Dollars (U.S.$75,000) per Day for each Day of delay beyond the end of two (2) calendar months following the expiry of the Grace Period.
|
(d)
|
If Redelivery is delayed more than four (4) calendar months beyond the end of the Grace Period for reasons solely attributable to the Contractor, then in such event, beginning from the fifth calendar month after the end of the Grace Period until the end of six calendar months after the end of the Grace Period, the Conversion Price shall be reduced by deducting the sum of one hundred thousand United States Dollars (U.S.$100,000) per Day for each Day of delay beyond the end of four (4) calendar months following the expiry of the Grace Period.
|
(e)
|
If Redelivery is delayed more than six (6) calendar months beyond the end of the Grace Period for reasons solely attributable to the Contractor, then, in such event, beginning from the seventh calendar month after the end of the Grace Period until the Contractor accrues the total limit for liquidated damages stated below in Article 16.3, the Conversion Price shall be reduced by deducting the sum of one hundred and forty five thousand United States Dollars (U.S.$145,000) per Day for each Day of delay beyond the end of six (6) calendar months following the expiry of the Grace Period.
|
14.2
|
However, the total reduction in the Conversion Price on account of such liquidated damages shall not be more than forty million United States Dollars (U.S.$40,000,000).
|
14.3
|
For the purposes of this Article 16, Redelivery shall be deemed to be delayed when and if the Vessel, after taking into full account all postponements of the Redelivery Date by reason of permissible delays and/or any other reasons under this Agreement, is not delivered by the date upon which Redelivery is required under the terms of this Agreement.
|
14.4
|
It is expressly understood and agreed by the Parties that in any case, if the Owner terminates this Agreement pursuant to Article 32.1 or Article 33, the Owner shall not be entitled to any damages or to liquidated damages as provided in this Article 16.
|
14.5
|
The Parties acknowledge and agree that the amount of liquidated damages payable for delay in Redelivery as provided in this Article 16 constitutes a genuine pre-estimate of the loss that would be suffered by the Owner as a result of the Contractor’s non-compliance with its obligations under this Agreement. In the event that such liquidated damages are determined to be unenforceable, the Owner shall be entitled to recover direct damages provided that such damages shall not exceed the maximum amount of liquidated damages which would have been recoverable under this Article 16 if the liquidated damages had been enforceable.
|
14.6
|
If Redelivery occurs earlier than the Redelivery Date, as may be adjusted in accordance with the terms of this Agreement, the Conversion Price shall be increased at the discretion of the Owner by a sum between one million to five million United States Dollars (U.S. $1,000,000 - $5,000,000), provided that the Conversion Price shall be increased only if the Owner has an arms-length contract with a party unconnected with the Owner for the employment of the Vessel. Such sum, if any, shall be paid by the Owner to the Contractor within 14 Days of the achievement of Substantial Performance.
|
14.7
|
As regards to the Sub-Contract Works the Contractor shall have no obligation to the Owner, whether by way of liquidated damages or otherwise, for delays to the Sub-Contractor’s performance of the Sub-Contract Works or for delays to the Works arising out of or in connection with the Sub-Contract Works, unless those delays are caused by the Contractor in breach of its obligations under the GANDRIA Topsides Agreement or this Agreement. Further, the Contractor shall have no obligation to the Owner in respect of the performance of the Topsides Scope in any Performance Tests or otherwise.
|
14.8
|
Where the Contractor’s performance of the Contractor’s Scope is delayed by causes which are the responsibility of the Sub-Contractor, such that Redelivery is delayed beyond the Redelivery Date, the Redelivery Date shall be postponed to the extent of the impact to the Contractor’s performance of the Contractor’s Scope.
|
14.9
|
Subject to Article 29, the Contractor shall endeavour to avoid or minimise the impact of any delays to the Contractor’s Scope caused by the Sub-Contractor.
|
17.
|
MECHANICAL COMPLETION
|
15.
|
The Contractor shall be responsible for achieving Mechanical Completion in respect of the Works.
|
15.1
|
Upon each stage of successful Mechanical Completion, the Owner’s Representative and the Contractor’s Representative shall sign Mechanical Completion Certificates in accordance with the procedure which the Contractor and the Owner shall agree before commencement of Mechanical Completion. In the event of minor works that are not completed but which do not affect the safe departure of the Vessel (“
Outstanding Works
”), the Mechanical Completion Certificate shall be signed with an agreed punch list of the Outstanding Works, which shall be subsequently completed by the Contractor within one month after Redelivery provided that the Owner grants the Contractor reasonable access and facilities.
|
15.2
|
Acceptance of Mechanical Completion as above provided shall be final and binding so far as conformity of the Works with this Agreement and the Specifications are concerned and shall preclude the Owner from refusing Redelivery.
|
18.
|
PRE-COMMISSIONING OF SUB-CONTRACT WORKS
|
16.
|
The Contractor shall be responsible for carrying out activities at the Yard for the Pre-Commissioning of the Sub-Contract Works, with the assistance of the Sub-Contractor, in accordance with the GANDRIA Topsides Agreement.
|
16.1
|
Upon each stage of successful Pre-Commissioning of the Sub-Contract Works, the Owner’s Representative and the Contractor’s Representative shall sign Pre-Commissioning Certificates of the Sub-Contract Works, in accordance with the procedure which the Contractor shall agree with the Sub-Contractor before commencement of Pre-Commissioning of the Sub-Contract Works.
|
19.
|
COMMISSIONING OF THE WORKS
|
17.
|
The Contractor shall perform Commissioning of the Works, as further detailed in Appendix 1B.
|
17.1
|
Upon each stage of successful Commissioning of the Works, the Owner’s Representative and the Contractor’s Representative shall sign a Commissioning Certificate in accordance with the procedure which the Contractor and the Owner shall agree before commencement of Commissioning of the Works.
|
17.2
|
The procedure set out in Article 17.2 in respect of Outstanding Works in relation to Mechanical Completion shall also apply to Commissioning of the Works.
|
20.
|
VESSEL LEAVING THE YARD
|
18.
|
Upon the completion of the Commissioning of the Works provided in Appendix 1B to be carried out in the Yard, the Owner’s Representative and the Contractor’s Representative shall sign the Certificate of Vessel Leaving The Yard in the form set out in Appendix 10, whereupon (subject to the payment of the Fourth Instalment in accordance with Article 15.4d)) the care, custody and control of the Vessel shall pass from the Contractor to the Owner (“
Vessel Leaving The Yard
”). The Owner shall concurrently deliver to the Contractor a bank guarantee in the form of Appendix
10 from a first-class Singapore bank acceptable to the Contractor, to be valid until the full discharge by the Owner of its obligations under this Agreement, whereupon the Contractor shall deliver to the Owner a discharge of the mortgage over the Vessel referred to in Article 47.
|
18.1
|
On and from the signing of the Certificate of Vessel Leaving The Yard and payment as set out in Article 20.1, the Vessel shall be at the sole risk of the Owner. The Owner shall be responsible for manning, security, watchmen and all other costs and liabilities relating to the Vessel after 7 days from such date of signing. The Contractor’s prevailing mooring/berthing rates will be payable by the Owner whilst the Vessel remains at the Yard beyond 7 Days after the signing of the Certificate of Vessel Leaving The Yard. During the 7 Days after the signing of the Certificate of Vessel Leaving The Yard that the Vessel remains in the Yard, the Contractor shall be fully entitled to move the Vessel to another part of the Yard at the Owner’s cost and risk of loss or damage arising from such movement.
|
18.2
|
Following the signing of the Certificate of Vessel Leaving The Yard in accordance with Article 20.1, and before it is required under this Agreement to cause the departure of the Vessel from the Yard, the Owner may, at its entire risk and cost, carry out Pre-Commissioning and Commissioning activities on and in respect of the Sub-Contract Works.
|
21.
|
COMMISSIONING AT ANCHORAGE
|
19.
|
Following the signing of the Certificate of Vessel Leaving The Yard and payment in accordance with Article 20.1, the Owner shall, at its own risk and cost, cause the Vessel to be moved within 7 Days from the Yard to an anchorage in Singapore.
|
19.1
|
The Contractor shall perform at such anchorage the remaining Commissioning of the Works in accordance with Appendix 1B, for which purpose the Owner shall provide to the Contractor reasonable and timely access and facilities. The procedure set out in Article 17.2 in respect of Outstanding Works in relation to Mechanical Completion shall also apply to Commissioning of the Works.
|
22.
|
REDELIVERY
|
20.
|
The Owner shall accept Redelivery immediately upon the completion of Commissioning at anchorage, and make payment of the Fifth Instalment and all other amounts then due to the Contractor from the Owner.
|
20.1
|
Redelivery is estimated to take place approximately 31 months from the effective date of the Owner’s Notice to Proceed pursuant to Article 4.4. Such estimate is based on the assumption that: (i) the Vessel is an exact replica of the
HILLI
; and (ii) the Works and Sub-Contract Works to be performed are identical to that being performed on the
HILLI
. For clarity, the Parties acknowledge that such assumption is inaccurate and that Redelivery shall take place on such date as is agreed between the Owner, the Contractor and the Sub-Contractor pursuant to the last paragraph in Article 4.3 of this Agreement and the last paragraph in Clause 4.2 of the Topsides Agreement, as such date may be adjusted in accordance with the terms of this Agreement. The aforementioned date or such later date to which the requirement of Redelivery is postponed pursuant to the terms of this Agreement, is herein called the “
Redelivery Date
”.
|
20.2
|
NOT USED
|
20.3
|
NOT USED
|
20.4
|
The Owner and the Contractor shall agree on adjustments to the schedules for the performance of the Works to meet adjustments in the Redelivery Date pursuant to this Article 22.
|
20.5
|
Provided that the Owner shall have made payment of the Fifth Instalment, Redelivery shall be effected by the concurrent delivery by each of the Parties to the other the Protocol of Redelivery and Acceptance acknowledging Redelivery of the Vessel by the Contractor and acceptance thereof by the Owner. Upon Redelivery, ownership, property and title to all goods, materials, spares, equipment (including, but not limited to, the Equipment and other items referred to in the GANDRIA Topsides Agreement), machineries, appurtenances, outfit, articles and items supplied to or installed on the Vessel whether pursuant to this Agreement, the GANDRIA Topsides Agreement or otherwise (hereinafter referred to collectively as the “
Contractor’s Equipment
”) shall, unless otherwise agreed, pass to the Owner but, until such time as the Vessel is redelivered to the Owner in accordance with this Article 22, ownership, property and title to all the Contractor’s Equipment as aforesaid shall remain vested solely and exclusively in the Contractor.
|
20.6
|
Upon Redelivery, the Contractor shall deliver to the Owner the following documents (if not already delivered): -
|
20.6.1
|
Protocol of Mechanical Completion;
|
20.6.2
|
Instruction books and operation manuals in the English language from the vendors or suppliers of the equipment procured by the Contractor under this Agreement including those received from the Sub-Contractor in respect of the Sub-Contract Works; and
|
20.6.3
|
Drawings and certificates as listed in the Specifications.
|
20.7
|
Concurrently with Redelivery, the Owner shall pay to the Contractor the Fifth Instalment (unless already paid in accordance with Article 15.4) and all other amounts then due to the Contractor from the Owner.
|
20.8
|
If the Owner fails to accept Redelivery according to this Agreement without any justifiable reason, the Contractor shall have the right to tender Redelivery after compliance of the procedural requirements as provided above.
|
20.9
|
The procedure set out in Article 17.2 in respect of Outstanding Works in relation to Mechanical Completion shall also apply to Redelivery. The Owner shall install the Commissioning Spares on the Vessel before Redelivery.
|
23.
|
SAILAWAY
|
21.
|
Following Redelivery, the Owner shall, at its own risk and cost, cause the Vessel to be moved promptly from Singapore anchorage to the Project Site (“
Sailaway
”).
|
21.1
|
Upon the earlier of Sailaway or 30 Days following Vessel Leaving The Yard, the Owner shall pay to the Contractor the Sixth Instalment and all other amounts then due to the Contractor from the Owner, if any.
|
24.
|
PROJECT SITE WORKS
|
22.
|
The Owner shall be responsible at its own costs, expense and risk for mobilising the Vessel to the Project Site, installing here there, hook up and all other activities required for the preparation for and carrying out of the Project Site Works.
|
22.1
|
The Owner shall provide Project Site Personnel to perform those Project Site Works to be carried out by the Owner with the assistance of the Contractor as provided in Appendix K and of the Sub-Contractor as provided in Clause 28 of the GANDRIA Topsides Agreement.
|
22.2
|
The Owner shall ensure that the Project Site is safe, accessible, compliant with Applicable Laws and not in breach of any term of this Agreement or of the GANDRIA Topsides Agreement. The Owner shall notify the Contractor in writing as soon as possible, but not less than 120 Days before the commencement of the Project Site Works, of the location of the Project Site, to enable the Contractor and the Sub-Contractor to prepare for mobilisation of the Contractor’s personnel and the Sub-Contractor Project Site Personnel (as defined in the GANDRIA Topsides Agreement) to the Project Site and to enable the Contractor and the Sub-Contractor to satisfy themselves as to the safety, regulatory, legal and operational environment at the Project Site.
|
22.3
|
The Owner shall provide the Contractor’s Representative and the Sub-Contractor with written notices at 90, 45, 21 and 5 Days prior to the date or dates when the Project Site Works are to commence. The 5-Day notice shall be accompanied by confirmation that the pre-conditions set out in Article 24.5 either have been fulfilled or will be fulfilled prior to the commencement of the Project Site Works.
|
22.4
|
Prior to the commencement of the Project Site Works and prior to the arrival of the Sub-Contractor Project Site Personnel at the Project Site (as defined in the GANDRIA Topsides Agreement), the Owner shall provide the following at the Project Site:
|
22.4.4
|
access to the Vessel from the date of commencement of the Project Site Works until Final Acceptance, to the extent necessary for the Contractor and the Sub-Contractor to perform their respective scopes of work in relation to the Contractor’s Scope and the Topsides Scope;
|
22.4.5
|
arrangements for transport of the Contractor’s and the Sub-Contractor’s personnel and materials between the nearest commercial international airport within the country in which the Project Site is located and the Project Site;
|
22.4.6
|
appropriate accommodation and catering for such personnel while they are required to be on the Vessel or on or near to the Project Site;
|
22.4.7
|
adequate Project Site office space;
|
22.4.8
|
adequate infrastructure support and Project Site Personnel for the Contractor’s and Sub-Contractor’s use at the Project Site for the purposes of the Project Site Works, adequate construction craft labour as may be required to support the activities of the Contractor and the Sub-Contractor at the Project Site including all supervision, labour and skilled mechanics with necessary small tools and consumables and all other material to ready the project for Project Site Works up through Final Acceptance, all to be provided in accordance with the Owner’s rate sheet containing labour rates on a non-profit basis, that shall be provided to the Contractor and Sub-Contractor no later than 30 Days prior to the scheduled Redelivery;
|
22.4.9
|
an adequate number of qualified and properly trained operators and maintenance personnel in a timely manner to support the Project Site Works;
|
22.4.10
|
reasonable assistance for the Contractor and the Sub-Contractor to obtain Authorisations as required by Applicable Laws at the Project Site for the Contractor and the Sub-Contractor to perform the Project Site Works;
|
22.4.11
|
sufficient feed stock and utilities (including fuel, air, power, water) and consumables (including reagents, chemicals, grease and lubricants complete with MSDS data) for the Project Site Works (providing however that the Sub-Contractor shall provide the Owner, with reasonable notice of its requirements at the Project Site);
|
22.4.12
|
first fills including but not limited to lubricants, refrigerants, catalyst, perlite insulation and chemicals following delivery of the Vessel to Project Site at the times and to the specification requested by the Sub-Contractor in order to complete the Project Site Works, provided that the Sub-Contractor has, six months prior to scheduled Sailaway or such shorter period of time as is reasonable under the circumstances, provided the Owner with a list identifying the foregoing items and quantities thereof;
|
22.4.13
|
sufficient storage for LNG product produced by the Vessel during the Project Site Works to support continuous, steady state operation necessary to achieve Final Acceptance in accordance with the Project Schedule;
|
22.4.14
|
cooled down LNG storage tanks on the Vessel ready to accept LNG production;
|
22.4.15
|
all required catalyst, chemicals, Owner’s Spares, fuels, lubricants, and the Commissioning Spares (which shall have been delivered by the Sub-Contractor in accordance with the GANDRIA Topsides Agreement) as listed in Appendix S of the GANDRIA Topsides Agreement. Such items shall be readily available either on the Vessel or adjacent to the Vessel;
|
22.4.16
|
LNG or liquefied nitrogen or other means to cool down the Vessel’s LNG storage tanks;
|
22.4.17
|
the safe, secure and stable mooring of the Vessel at the Project Site and the hooking up and commissioning of the relevant gas feed line;
|
22.4.18
|
the necessary Authorisations for the Project Site Works having been obtained; and
|
22.4.19
|
the availability of accommodation on the Vessel for the Contractor’s and Sub-Contractor’s personnel; and the Contractor's and the Sub-Contractor’s acceptance (acting reasonably) of the health, safety, security and other arrangements at the Project Site in accordance with Article 42 of this Agreement and Clause 14.5 of the GANDRIA Topsides Agreement.
|
22.5
|
The Sub-Contractor shall deliver to the Owner a list of Owner’s Spares with itemised prices as provided for in Clause 21.3 of the GANDRIA Topsides Agreement.
|
22.6
|
The Owner shall procure at its own cost the Owner’s Spares, either from the Sub-Contractor or from others.
|
22.7
|
The Owner’s Spares shall be made available at or transported to the Project Site by the Owner at its own cost prior to the Sub-Contractor’s arrival at the Project Site.
|
22.8
|
The Owner’s Spares may be used by the Sub-Contractor during Startup, Project Site Commissioning and in support of warranty work pursuant to Clauses 21.5 to 21.6 of the GANDRIA Topsides Agreement.
|
25.
|
CONDITIONS PRECEDENT FOR PROJECT SITE COMMISSIONING
|
23.
|
Project Site Commissioning will commence when the Owner has issued the Ready for First Gas Certificate.
|
23.1
|
The Ready for First Gas Certificate shall be issued by the Owner to the Sub-Contractor when the Owner is satisfied that feed gas may be introduced into the liquefaction system, including the satisfaction by the Owner of all the following conditions precedent:
|
23.1.1
|
the hook up of the gas transmission line has been accomplished;
|
23.1.2
|
all necessary Authorisations have been obtained in order for Project Site Commissioning to commence;
|
23.1.3
|
the Vessel is free from any damage to equipment or systems that may have occurred in transit to the Project Site and which would affect the operation of the Sub-Contract Works;
|
23.1.4
|
the feed gas pipeline is fully operational;
|
23.1.5
|
all “dried” systems have maintained dryness during transit or have been dried at the Project Site;
|
23.1.6
|
all infrastructure required to support Project Site Commissioning, the warranty work and rectification efforts is available (e.g. crew vessels, craft labour, spare parts, etc.);
|
23.1.7
|
a pre-start-up safety review has been completed;
|
23.1.8
|
cool down of the Vessel LNG storage tanks is completed in sufficient time for the introduction of produced LNG;
|
23.1.9
|
operator training has been completed and a sufficient number of trained operation and maintenance personnel are on board to support Startup and Project Site Commissioning;
|
23.1.10
|
the provision of all safety management and issuance of any subsequent work permit and/or hot work permits which may be required to support the Commissioning schedule; and
|
23.1.11
|
the Owner formally assuming responsibility for all safety management and issuance of any subsequent work permits which may be required to support Project Site Commissioning.
|
23.2
|
The Owner shall demonstrate satisfaction of the above conditions precedent together with the Ready for First Gas Certificate.
|
23.3
|
The Sub-Contractor shall respond to the Ready for First Gas Certificate in writing either with its agreement or, if it disagrees, with full details of its reasons within three Days of receipt of the Ready for First Gas Certificate.
|
23.4
|
If any of the conditions precedent listed in Article 25.2 is not fulfilled, causing the Ready for First Gas Certificate not to be issued (and for Project Site Commissioning not to commence) (or any repetition thereof in the event of prior failure), the Owner shall, at its own cost, make all appropriate adjustments and modifications with all reasonable speed and at its own expense to enable the Ready for First Gas Certificate to be issued. If the Ready for First Gas Certificate has not been issued to the Sub-Contractor within 28 Days from the receipt by the Sub-Contractor of the final notice referred to in Article 24.4 for reasons which are not the Sub-Contractor’s responsibility, the Sub-Contractor shall be entitled to a Variation Order (from the Owner, through the GANDRIA Topsides Agreement and this Agreement) for its reasonable increased costs arising from such delay.
|
26.
|
PROJECT SITE COMMISSIONING
|
24.
|
The Owner shall perform the Project Site Commissioning with the assistance of the Contractor and of the Sub-Contractor.
|
24.1
|
The Owner, the Contractor or the Sub-Contractor shall be entitled to order the cessation of any aspect of Project Site Commissioning if damage to the Vessel or other property or personal injury is likely to result from continuation.
|
24.2
|
Project Site Commissioning activities of the Owner shall be presented in a written report(s) produced and delivered by the Owner to the Sub-Contractor within five (5) Days of the completion of the relevant aspect of Project Site Commissioning. The form and content of the report(s) will be agreed between the Owner and the Sub-Contractor prior to Sailaway.
|
24.3
|
The Sub-Contractor may, acting reasonably, within five (5) Days of receipt of a report produced by the Owner in accordance with Article 26.3, give the Owner a notice that it considers:
|
24.3.1
|
the report to be deficient in any way and that it requires the Owner to correct and resubmit the report, and the Owner must, at its own cost, resubmit the report;
|
24.3.2
|
that the Owner has failed to achieve Project Site Commissioning, such notice setting out the reasons for such failure; or
|
24.3.3
|
that Project Site Commissioning has been successfully performed.
|
24.4
|
If any part of the Project Site Commissioning fails (or any repetition thereof in the event of prior failure) or if Project Site Commissioning (or any part thereof) is stopped before completion, the Owner shall, at its own cost, make all appropriate adjustments and modifications with all reasonable speed and at its own expense and Project Site Commissioning (or the relevant part thereof) shall be repeated by the Owner as soon as practicable thereafter, and the Sub-Contractor shall be afforded schedule adjustments which may apply.
|
24.5
|
Where Project Site Commissioning has been achieved such that the Sub-Contractor has issued the requisite notice pursuant to Article 26.4.3, and all other Commissioning requirements have been satisfied, the Owner shall immediately issue the Ready for Startup Certificate in the form set out in Appendix 10 and proceed to Startup.
|
27.
|
START UP AND PERFORMANCE TESTS
|
25.
|
The Owner shall perform Startup and the Performance Tests with the assistance of the Sub-Contractor. The Sub-Contractor shall provide technical services in accordance with Appendices D, K and Z of the GANDRIA Topsides Agreement concerning Startup and the carrying out of the Performance Tests in accordance with the procedures and requirements for the Performance Tests set out in Clause 31, and Appendices N and O of the GANDRIA Topsides Agreement.
|
25.1
|
The GANDRIA Topsides Agreement provides as follows in relation to performance of the Equipment during the Performance Tests:
|
•
|
Substantial Performance
|
•
|
Minimum Performance
|
•
|
Guaranteed Performance
|
•
|
Guaranteed Fuel Usage
|
•
|
Guaranteed Electrical Power Consumption
|
25.2
|
The Performance Tests shall demonstrate the achievement of Substantial Performance, Minimum Performance and Guaranteed Performance (together the “
Performance Tests
”), the latter to include Guaranteed Fuel Usage and Guaranteed Electrical Power Consumption.
|
25.2.4
|
Substantial performance ("
Substantial Performance
") shall be achieved when the liquefaction plant has achieved, in the aggregate, an average LNG output of at least 70 per cent of the Guaranteed LNG Output over a period of 72 consecutive hours.
|
25.2.5
|
Minimum performance ("
Minimum Performance
") shall be achieved when the liquefaction plant has achieved, in the aggregate, an average LNG output of at least 80 per cent of the Guaranteed LNG Output over a period of 72 consecutive hours.
|
25.3
|
Notwithstanding anything in Article 27.3 to the contrary, the Owner, the Contractor and the Sub-Contractor recognise that there may be circumstances during Commissioning, Startup and Performance Tests where there is enough feed gas to only operate one or more, but less than all, of the trains. The manner in which Substantial Performance, Minimum Performance and Guaranteed Performance under such circumstances will be determined shall be in accordance with Appendix N of the GANDRIA Topsides Agreement.
|
25.4
|
The Contractor, the Owner or the Sub-Contractor shall be entitled to order the cessation of any Performance Tests if damage to the Works or other property or personal injury is likely to result from continuation.
|
25.5
|
The results of the Performance Tests shall be collected and presented by the Owner in accordance with Appendix O (
Performance Tests Procedures
) of the GANDRIA Topsides Agreement.
|
25.6
|
Where all the requirements for Substantial Performance have been satisfied, the Sub-Contractor shall issue a notice (in the form of Appendix X of the GANDRIA Topsides Agreement) to the Owner that Substantial Performance has been achieved. Upon the Owner’s verification and signing off, such notice shall become the Substantial Performance Certificate, effective as of the date of notice by the Sub-Contractor. In the event that the Owner fails to sign off on or object to the Sub-Contractor’s notice within 2 Days, Substantial Performance shall be deemed to have been achieved on the date of the Sub-Contractor’s notice.
|
25.7
|
Where all the requirements for Minimum Performance have been satisfied, the Sub-Contractor shall issue a notice (in the form of Appendix X of the GANDRIA Topsides Agreement) to the Owner that Minimum Performance has been achieved. Upon the Owner’s verification and signing off, such notice shall become the Minimum Performance Certificate, effective as of the date of notice by the Sub-Contractor. In the event that the Owner fails to sign off on or object to the Sub-Contractor’s notice within 4 Days, Minimum Performance shall be deemed to have been achieved on the date of the Sub-Contractor’s notice.
|
25.8
|
Where all the requirements for Guaranteed Performance have been satisfied, the Sub-Contractor shall issue a notice (in the form of Appendix X of the GANDRIA Topsides Agreement) to the Owner that Guaranteed Performance has been achieved. Upon the Owner’s verification and signing off, such notice shall become the Guaranteed Performance Certificate, effective as of the date of notice by the Sub-Contractor. In the event that the Owner fails to sign off on or object to the Sub-Contractor’s notice within 4 Days, Guaranteed Performance shall be deemed to have been achieved on the date of the Sub-Contractor’s notice
|
25.9
|
If:
|
25.9.1
|
a notice of objection is given by the Owner stating the Sub-Contract Works have failed to achieve either Substantial Performance, Minimum Performance or Guaranteed Performance following a Performance Test (or any repetition thereof in the event of prior failure), the Sub-Contractor shall:
|
(a)
|
proceed with rectification efforts as soon as is practicable and thereafter continue to expeditiously (subject to having unimpeded access to the Sub-Contract Works) make all appropriate adjustments and modifications with all reasonable speed. The Owner shall provide, on a timely basis in support of the Sub-Contractor’s plan for rectification, all labour, tools, spare parts and all other resources for making such adjustments and modifications as required by the Sub-Contractor at the Sub-Contractor’s expense all in accordance with the Owner’s rate sheet containing labour rates on a non-profit basis, that shall be provided by the Owner to the Sub-Contractor no later than 30 Days prior to the scheduled Redelivery. The Sub-Contractor shall give the Owner one Day’s prior notice that the Sub-Contract Works is ready for the re-performance of the Performance Tests (or the relevant part thereof); or
|
(b)
|
if Minimum Performance has been achieved, within five (5) Days after the date of issue of the notice under Article 27.10.1, provide the Owner with a schedule detailing the work to be performed in accordance with Article 27.10.1(a). Within three (3) Days of receipt of such schedule, the Owner, acting reasonably, will approve the schedule or advise the Sub-Contractor of any reasonable amendments required (giving reasons for such amendments). The Sub-Contractor will continue to resubmit amendments to the schedule until approved by the Owner. If the Owner fails to advise under this Article 27.10.1(b) within three (3) Days then the schedule provided shall be deemed to be approved with no amendments. The Sub-Contractor will perform the work referred to in Article 27.10.1 (a) in accordance with the schedule approved by the Owner in accordance with this Article 27.10.1 (b) and
|
25.9.2
|
either (a) following a period of no less than 280 Days after the Ready for First Gas Certificate, the Sub-Contractor has failed to achieve Substantial Performance or (b) following a period of no less than 180 Days after the achievement of Substantial Performance, the Sub-Contractor has subsequently failed to achieve Guaranteed Performance, the Owner may:
|
25.9.3
|
the Sub-Contractor is, at any time, of the view that no further commercially reasonable efforts will improve the performance of the Sub-Contract Works, the Sub-Contractor shall give the Owner notice of such held view (provided that such notice shall not constitute an abandonment of this Agreement by the Sub-Contractor). Notwithstanding anything in this Agreement to the contrary, the actual costs of the Sub-Contractor’s rectification efforts to achieve Guaranteed Performance shall count towards the Sub-Contractor’s overall limit of liability in Clause 33.13 of the GANDRIA Topsides Agreement.
|
25.10
|
Under the GANDRIA Topsides Agreement Substantial Performance shall be achieved on or before 145 Days from First Gas (the “
Guaranteed Substantial Performance Date
”). If Substantial Performance is achieved on or before 71 Days after First Gas, and provided that both Guaranteed Performance and Final Acceptance are subsequently achieved, the Sub-Contractor shall be entitled, from the Owner, to an additional payment via the Contractor at the rate of U.S. $10,000 per diem for Days 67 through 71 and U.S. $25,000 for Days 66 and earlier. The Owner shall pay to the Contractor such amounts equal to the amount due to the Sub-Contractor in good time to enable the Contractor to discharge its obligation to the Sub-Contractor.
|
25.11
|
The Sub-Contractor’s guarantee regarding the Guaranteed Substantial Performance Date is conditioned upon no delay for any reason other than those solely attributable to the Sub-Contractor. If the Sub-Contractor becomes aware of a delay to the Project Schedule not solely attributable to the Sub-Contractor the Sub-Contractor shall provide written notice to the Owner and Contractor of the same and shall update the Project Schedule on a daily basis.
|
25.12
|
For the purposes of the Sub-Contractor carrying out the Project Site Works, any work to be done by the Sub-Contractor in order to achieve Substantial Performance, Minimum Performance, Guaranteed Performance and/or Final Acceptance, the Owner shall arrange for the Owner’s Spares to be readily available. Any spare parts used by the Sub-Contractor shall promptly (by a reasonable standard) and at its own cost and expense be replaced by it and delivered to such location as the Owner may direct in writing. To the extent the Owner’s Spares are not available for any of the activities listed in the first sentence of this Article 27, the Sub-Contractor and the Contractor shall be entitled to a Variation to the extent their respective costs or schedule are adversely impacted.
|
25.13
|
For the purposes set out in Article 27.13, the Owner shall provide the Sub-Contractor with the necessary access to the Vessel as set out in a reasonable plan and schedule to be delivered by the Sub-Contractor to the Owner sufficiently in advance.
|
25.14
|
If Minimum Performance is achieved but Guaranteed Performance is not achieved and the Sub-Contractor is not given access to the Vessel by the Owner pursuant to Article 27.10 for at least six periods each of access sufficient for the performance of rectification activities by the Sub-Contractor within a period of 180 Days from the date when Minimum Performance is achieved as provided for in the plan and schedule referred to in Article 27.10.1 (b) above, then the Sub-Contractor shall be deemed to have achieved Guaranteed Performance on the date which is 180 Days from the date when Minimum Performance is achieved.
|
28.
|
FINAL ACCEPTANCE
|
26.
|
When all Sub-Contract Works necessary to achieve Final Acceptance are completed including:
|
(a)
|
having obtained required certifications of the Sub-Contract Works from the Certification Body;
|
(b)
|
completion of all Sub-Contract Works, except for those obligations expressly provided to be completed after Final Acceptance; and
|
(c)
|
having successfully completed all Performance Tests, or such tests being deemed completed, or the Sub-Contractor having paid to the Owner any liquidated damages due for failure to achieve Guaranteed Performance as provided in Appendix P of the GANDRIA Topsides Agreement,
|
26.1
|
The Owner shall, within five (5) Days after receipt of such notice from the Sub-Contractor either notify the Sub-Contractor in writing of its agreement that Final Acceptance has been achieved effective as of the date of the Sub-Contractor’s notice, or otherwise shall provide the Sub-Contractor with a formal notice that specifies those items that the Owner considers to be outstanding by reference to the terms of the GANDRIA Topsides Agreement.
|
26.2
|
The Sub-Contractor shall remedy all outstanding items notified by the Owner to the Sub-Contractor under Article 28.2, and shall carry out any appropriate tests to demonstrate that Final Acceptance has been achieved. The Sub-Contractor shall give the Owner notice in writing when it considers that Final Acceptance has been achieved, whereupon the Owner and the Sub-Contractor shall again follow the procedure set forth in Article 28.2, and, if necessary, shall repeat the process until the Sub-Contract Works achieve Final Acceptance, when the Owner shall notify its agreement by signing on the Final Acceptance Form in Appendix X of the GANDRIA Topsides Agreement.
|
26.3
|
Notwithstanding anything in this Agreement to the contrary, at any time after achieving Minimum Performance the Sub-Contractor shall have the right to pay performance liquidated damages based on the results of the last Performance Test in which case the Sub-Contractor shall be deemed to have achieved Guaranteed Performance.
|
29.
|
DELAYS AND PERFORMANCE DEFICIENCIES – SUB-CONTRACT WORKS
|
27.
|
The Contractor shall take reasonably practicable steps to avoid or minimise any delay to Redelivery which might otherwise result from the Sub-Contractor’s performance of the Topsides Scope, provided that the cost to the Contractor of doing so shall not exceed the amount received by the Contractor from the Sub-Contractor in respect of such delay by the Sub-Contractor pursuant to Clause 33.2 of the GANDRIA Topsides Agreement.
|
27.1
|
The Contractor shall be entitled to a Permitted Delay Event for any delay to Redelivery despite the Contractor’s taking of those steps.
|
27.2
|
Any payment received on or before Redelivery by the Contractor from the Sub-Contractor pursuant to Clauses 33.3 and/or 33.4 of the GANDRIA Topsides Agreement shall be credited by the Contractor against the Sixth Instalment of the Conversion Price.
|
27.3
|
Any other payment received by the Contractor from the Sub-Contractor pursuant to Clauses 33.3, 33.4, 33.7, 33.8 and/or 33.9 of the GANDRIA Topsides Agreement shall be credited by the Contractor against the Eighth Instalment of the Conversion Price.
|
27.4
|
In the event that after payment by the Owner to the Contractor of the Seventh Instalment, any payment is received by the Contractor from the Sub-Contractor pursuant to Clauses 33.3, 33.4, 33.7, 33.8 and/or 33.9 of the GANDRIA Topsides Agreement, the Contractor shall pass such amount received by it from the Sub-Contractor to the Owner after deducting any amount due to the Contractor from the Owner.
|
27.5
|
The Contractor shall have no responsibility for either the performance of the Sub-Contract Works in the Performance Tests nor for any defect, deficiency or suitability of the Sub-Contract Works.
|
30.
|
DELAYS & EXTENSION OF TIME FOR REDELIVERY
|
28.
|
The Contractor shall be entitled to a Variation Order in respect of any delay to the Works resulting from any Permitted Delay Event. In addition, the Contractor shall also be entitled to a Variation Order in respect of the delay, costs and expenses relating to the Works incurred by it as a consequence of any such delay exceeding 70 Days in the aggregate. The Contractor shall be entitled to a Variation Order in respect of the costs and expenses and delay to the Sub-Contract Works resulting from a Force Majeure Event and shall be entitled to monthly payment of such costs and expenses during the pendency of such event. For the avoidance of doubt, the Sub-Contractor’s labour costs shall be invoiced in accordance with the discounted rates set forth in Appendix B of the GANDRIA Topsides Agreement for the first 30 Days of delay, in the aggregate.
|
28.1
|
For the purposes of this Article 30, a “
Force Majeure Event
” is an unanticipated event beyond the reasonable control of, and without the fault or negligence of, the Party claiming such Force Majeure Event and may include, without limitation, acts of God; unusually severe actions of the elements such as droughts, storms, floods, hurricanes, tornadoes, lightning, earthquakes or landslides; epidemics; sabotage; terrorism; war (declared or undeclared); embargoes; fire; explosion; strikes or other labour disputes, excluding those specifically targeting any contractor at the Yard; civil unrest, riots, delays in transportation, car shortages, and actions or failure to act of any government authority (including expropriation, requisition, or injunction), preventing delaying or adversely affecting the performance of a Party to this Agreement. However, a Force Majeure Event does not include change in economic conditions or shortage of funds.
|
28.2
|
Within five (5) Days of becoming aware of a Permitted Delay Event the Contractor shall notify the Owner in writing of the date such Permitted Delay Event occurred. The Contractor shall also notify the Owner of the period by which the Redelivery Date and the dates scheduled for the achievement of Substantial Performance and Final Acceptance by the Sub-Contractor are postponed by reason of such cause of delay with all reasonable despatch after it has been determined.
|
28.3
|
An addendum to this Agreement specifying the reasons for and extent of such extension will be discussed, agreed and executed by the Parties. Furthermore, the Sub-Contractor shall be entitled to, and the Owner shall pay, for additional costs incurred by the Sub-Contractor in relation to Force Majeure Events affecting the Sub-Contractor.
|
28.4
|
In the event:
|
i.
|
any Permitted Delay Event, or in case of the Sub-Contract Works any Force Majeure Event (“
Topsides Force Majeure
”) causes a prolonged delay in the progress in carrying out the Works or Sub-Contract Works such that an interruption in operations through the occurrence of the Permitted Delay Event and/or the Topsides Force Majeure continues for a period of one hundred and eighty (180) Days or more, or two hundred and seventy (270) Days in aggregate, the Owner, or
|
ii.
|
any such interruption in operations continues for a period of three hundred and sixty (360) Days or more in aggregate, the Contractor
|
28.5
|
Each Party shall at all times use reasonable endeavours to overcome the effects of and minimise any impact to the performance of this Agreement as a result of a Permitted Delay Event and/or a Force Majeure Event.
|
28.5.1
|
The affected Party shall also provide notice to the other Party as soon as reasonably practicable of:
|
(a)
|
the cessation of the Permitted Delay Event; and
|
(b)
|
the cessation of the effects of the event of the Permitted Delay Event on the affected Party’s ability to recommence performance of its obligations under this Agreement.
|
28.6
|
Force Majeure Affecting a subcontractor
|
31.
|
SUSPENSION
|
29.
|
The Owner shall have the right, not before the expiry of 12 months from the Effective Date
but no later than 6 months before the scheduled date of Vessel Leaving The Yard, by written notice to the Contractor, to suspend the Works and/or the Sub-Contract Works or any part thereof (the “
Suspended Works
”) from the date, for the period and to the extent detailed in the notice, for any of the following reasons:
|
(a)
|
in the event that suspension is necessary for the proper execution or safety of the Suspended Works, or safety of persons or property; or
|
(b)
|
to suit the convenience of the Owner.
|
29.1
|
The Owner shall have the right after Sailaway by written notice to the Contractor and Sub-Contractor, to suspend the Sub-Contract Works or any part thereof (the "
Suspended Works
") from the date, for the period and to the extent detailed in the notice, for any of the following reasons:
|
29.1.1
|
the lack of availability of a Project Site;
|
29.1.2
|
the lack of employment opportunities for the Vessel;
|
29.1.3
|
the lack of gas available for liquefaction at the Project Site;
|
29.1.4
|
the lack of commercial shipping available for produced LNG; or
|
29.1.5
|
the Owner not being ready to commence the Project Site Works within 2 months of such planned date.
|
29.2
|
Upon receipt of any such notice, the Contractor shall, unless instructed in writing by the Owner otherwise:
|
(a)
|
discontinue the Suspended Works detailed in the notice, on the date, for the period and to the extent specified;
|
(b)
|
properly protect and secure the Works, including any action reasonably required by the Owner, and including taking necessary measures for the preservation of the Works already executed (if any) and of the Equipment (or part thereof);
|
(c)
|
take all reasonable measures to minimize the resulting costs, expenses and losses, including placing no further orders and making no further subcontracts with its suppliers with respect to the Suspended Works other than as specified in the notice;
|
(d)
|
promptly make reasonable effort to obtain suspension of all outstanding orders and subcontracts to the extent they relate to the execution of the portion of the Suspended Works; and
|
(e)
|
continue to perform all unsuspended parts of the Works and/or the Sub-Contract Works, as applicable.
|
29.3
|
As a result of any such suspension, the Conversion Price and Redelivery Date shall be adjusted as relevant in accordance with Article 13, except where the suspension for safety reasons is solely caused by the Contractor.
|
29.4
|
As a result of any such suspension, the Topsides Price and schedule for the Sub-Contract Works shall be adjusted as relevant in accordance with the GANDRIA Topsides Agreement, except where the suspension for safety reasons is solely caused by the Sub-Contractor. Where such suspension has been called by the Owner, the Owner shall be fully responsible for any resulting adjustments of the Topsides Price in accordance with the GANDRIA Topsides Agreement. This includes that where any period of suspension occurs for a continuous period of 30 days or more, the Owner shall pay for the Sub-Contractor’s entitlement to invoice for payment in accordance with the GANDRIA Topsides Agreement for Sub-Contract Works performed until suspension without regard to whether or not a milestone has been achieved (less any amounts previously paid for or in relation to the Sub-Contract Works).
|
29.5
|
The Owner may, by further notice, instruct the Contractor to resume the Suspended Works to the extent specified.
|
29.6
|
During the period of such suspension, the Vessel shall remain in the Yard.
|
29.7
|
In the event of any suspension, the Owner and the Contractor shall meet at not more than seven (7) Day intervals with a view to agreeing a mutually acceptable course of action during the suspension.
|
29.8
|
If the period of any suspension pursuant to Article 31 exceeds 30 Days per occurrence or 90 Days in the aggregate, the Contractor may serve a written notice on the Owner requesting written permission within seven (7) Days from the Owner's receipt of such notice to proceed with the Suspended Works. If the period of any suspension pursuant to Article 31.2 exceeds 270 Days in the aggregate, the Sub-Contractor may serve a written notice on the Owner requesting written permission within twenty one (21) Days from the Owner's receipt of such notice to proceed with the Suspended Works. If within such period the Owner does not grant such permission the Contractor or the Sub-Contractor, by a further notice, may at its option treat the suspension as either:
|
29.8.1
|
where it affects part only of the Works, and/or of the Sub-Contract Works a deletion of such part under Article 13; or
|
29.8.2
|
where it affects the whole of the Works, and/or the Sub-Contract Works, termination in accordance with Article 33.
|
29.9
|
As soon as possible after the Contractor and/or the Sub-Contractor re-commences performance of the Works and/or the Sub-Contract Works following suspension pursuant to Article 31 or 31.2 the parties shall discuss in good faith and use reasonable efforts to agree any extension of time to which the Contractor and/or the Sub-Contractor may be entitled pursuant to Article 31.4 and 31.5.
|
29.10
|
For the avoidance of doubt, a suspension under this Article 31 shall not affect the Owner’s payment obligations under Article 15.
|
32.
|
TERMINATION FOR CAUSE
|
30.
|
The Contractor shall be deemed to be in default of the performance of its obligations under this Agreement in the following cases: -
|
(a)
|
Redelivery is delayed for reasons which the Contractor is solely responsible beyond such time as would elapse if the maximum amount of liquidated damages payable by the Contractor for such delay pursuant to Article 16.3 is exceeded;
|
(b)
|
the Contractor is in breach of any of its other material obligations under this Agreement and fails within thirty (30) Days to take reasonable steps to commence the remedy of such breach and within a reasonable period cure such breach after written notice has been given to the Contractor by the Owner pursuant to this Article 32.1(b) with particulars of the breach that is required to be remedied;
|
(c)
|
an order or an effective resolution is passed for the winding up of the Contractor (other than for the purposes of a reconstruction or amalgamation) or if a receiver or an administrator or judicial manager or liquidator is appointed over the whole or any part of the undertaking or property of the Contractor or if winding up or other types of insolvency proceedings are commenced against the Contractor or if the Contractor becomes insolvent or suspends payment generally of its debts or ceases to carry on its business or makes any special arrangement or composition with its creditors or if a voluntary winding up resolution has been made in respect of the Contractor;
|
(d)
|
an event analogous to Article 32.1(c) above occurs in relation to the Contractor Guarantor;
|
(e)
|
a material adverse change occurs in the financial condition of the Contractor which would affect the Contractor’s ability to perform all its obligations under this Agreement;
|
(f)
|
the aggregate cap on the Contractor’s liability under this Agreement pursuant to Article 35.2 is reached; or
|
(g)
|
the Contractor is in material breach of its obligations under Article 48;
|
30.1
|
The Owner shall be deemed to be in default of the performance of its obligations under this Agreement in the following cases:
|
(a)
|
The Owner fails to pay the Contractor any monies that have become due and payable under this Agreement after the Contractor has given the Owner 30 Days’ written notice of its failure to pay such monies; provided, however, that as an alternative to termination the Contractor and the Sub-Contractor shall be entitled to suspend the performance of the Works and/or Sub-Contract Works work after the Owner’s failure to pay any undisputed amount due under the provisions of this Agreement and/or the GANDRIA Topsides Agreement within thirty (30) Days’ written notice from the Contractor and/or Sub-Contractor of such failure by the Owner to pay on the due date;
|
(b)
|
The Owner fails to deliver the Vessel to the Contractor within 150 Days after the time prescribed for its Delivery under Article 5.2, unless within such period the Parties agree and sign a Variation Order pursuant to Article 13 and the Contractor and the Sub-Contractor agree and sign a Variation Order, pursuant to the terms of the GANDRIA Topsides Agreement providing for the terms (including price and schedule) for the substitution of the “Gandria” for the Vessel;
|
(c)
|
The Owner fails to take Redelivery and pay all amounts due to the Contractor within fourteen (14) Days after the Contractor having given written notice to the Owner of its failure to take Redelivery or tendered the Vessel for Redelivery and stating its intention to terminate this Agreement pursuant to this Article 32.2;
|
(d)
|
An order or an effective resolution is passed for the winding up of the Owner (other than for the purposes of a reconstruction or amalgamation) or if a receiver or an administrator or judicial manager or liquidator is appointed over the whole or any part of the undertaking or property of the Owner or if winding up or other types of insolvency proceedings are commenced against the Owner or if the Owner becomes insolvent or suspends payment generally of its debts or ceases to carry on its business or makes any special arrangement or composition with its creditors or if a voluntary winding up resolution has been made in respect of the Owner;
|
(e)
|
The Owner is in breach of any of its material obligations under this Agreement and fails to within thirty (30) Days to take reasonable steps to commence the remedy of such breach and within a reasonable period cure such breach after written notice has been given to the Owner by the Contractor pursuant to this Article 32.2(e) with particulars of the breach that is required to be remedied;
|
(f)
|
A material adverse change occurs in the financial condition of the Owner which would affect the Owner’s ability to perform all its obligations under this Agreement;
|
(g)
|
A change in control of the Owner (save where the control of the Owner passes to an Affiliate of the Owner) occurs without prior written consent of the Contractor, such consent not to be unreasonably withheld;
|
(h)
|
The Owner fails to make timely payment of any amount due to the Contractor in respect of the Sub-Contract Works and the Contractor, having applied all of the Topsides Credit towards any payment then outstanding of the Sub-Contractor, does not receive within 7 Days of written notice to the Owner, such amount as the Owner should have paid under the terms of this Agreement and the GANDRIA Topsides Agreement, in addition to restoring as the Topsides Credit to the level prescribed in Article 15.10;
|
(i)
|
At any time up to Vessel Leaving The Yard, the Contractor does not receive from the Owner, upon 14 Days of the Contractor’s written demand, such amount that will result in the Contractor having available to it the full Topsides Credit set out in Article 15.10; or
|
(j)
|
The Owner fails to obtain and/or procure, in the event of any detention, seizure, arrest, expropriation, attachment, sequestration, distress or execution of the Vessel (except where such detention, seizure, arrest, expropriation, attachment, sequestration, distress or execution of the Vessel is by the Contractor’s sub-contractors and caused solely by the Contractor’s non-payment of its sub-contractors), the release of the Vessel from the same within thirty (30) Days of such detention, seizure, arrest, expropriation, attachment, sequestration, distress or execution of the Vessel,
|
30.2
|
If this Agreement is terminated by the Contractor pursuant to Article 32.2, the Owner shall immediately pay the Contractor:
|
(a)
|
for the Works performed until termination (less any amounts previously paid to the Contractor for the Works);
|
(b)
|
the cost of any uninstalled equipment or materials, not already included in Article 32.3 (a);
|
(c)
|
any reasonable additional amount incurred by the Contractor as a result of termination of the part or parts of the Works including any unavoidable liability to subcontractors, suppliers and vendors directly related to termination of part(s) of the Works;
|
(d)
|
such amount as will indemnify the Contractor for any amount which may become payable by the Contractor to the Sub-Contractor as a consequence of the termination by the Contractor of the GANDRIA Topsides Agreement;
|
(e)
|
fifteen percent (15%) of the balance of the Conversion Price
|
30.3
|
If this Agreement is terminated by the Owner pursuant to Article 32.1, then the Owner shall immediately pay to the Contractor:
|
(a)
|
for the Works performed until termination (less any amounts previously paid to the Contractor for the Works);
|
(b)
|
the cost of any uninstalled equipment or materials, not already included in Article 32.4 (a);
|
(c)
|
for the Sub-Contract Works performed until termination; and
|
(d)
|
security for any amount in dispute in wording, amount and from a guarantor reasonably acceptable to the Contractor,
|
30.4
|
In no circumstances shall the Contractor have any responsibility to the Owner in respect of the Sub-Contract Works, whether or not the Sub-Contract Works have been completed at the time of such termination.
|
30.5
|
For the avoidance of doubt, in no event shall the Owner be entitled to a refund of payments effected by the Owner to the Contractor for Works performed by the Contractor or the Sub-Contractor and the remedies set out herein shall be the Owner’s sole and exclusive remedy (whether at law, contract, equity or otherwise) in the event of termination of the Agreement by the Owner.
|
30.6
|
Without prejudice to any other rights or remedy which the Contractor may have, if the Owner does not within 14 days of the date of termination, make payment to the Contractor in accordance with either Article 32.3 or Article 32.4 or furnish security for such payment on terms satisfactory to the Contractor, the following provisions shall apply:
|
30.6.1
|
The Contractor shall have the full right and power either to complete or not to complete the Vessel as it deems fit, and to take, retain, keep possession, preserve or sell the Vessel, or any part thereof or any Equipment or OFE by way of a public or private sale by any means or process including but not limited to a court process in any jurisdiction at such price and on such terms and conditions as the Contractor in its sole discretion thinks fit or to dispose of the Vessel or any part thereof or the Equipment or OFE, without being answerable for any loss or damage.
|
30.6.2
|
In the event of the sale of the Vessel in its completed state, the proceeds of sale received by the Contractor shall be applied firstly to payment of all expenses attending such taking, retention, possession, preservation, sale or disposal and otherwise incurred by the Contractor as a result of the Owner's default, including but not limited to mooring, wharfage, berthing and dockage dues, costs of manning, security and watchmen, any movement, towage and then to payment of all unpaid instalments of the Conversion Price and interest on such instalments at the Default Interest Rate from the respective due dates thereof to the date of application.
|
30.6.3
|
In the event of sale of the Vessel in its incomplete state, or any part thereof or any Equipment or OFE, the proceeds of sale received by the Contractor shall be applied firstly to all expenses incurred by the Contractor as a result of the Owner's default, including but not limited to mooring, berthing, wharfage and dockage dues, costs of manning, security and watchmen, any movement, towage and then to payment of the amounts due under Articles 32.3 (a) to (e) and Articles 32.4 (a) to (c) .
|
30.6.4
|
In either of the above events of sale, if the proceeds of sale exceeds the total of amounts to which such proceeds are to be applied as aforesaid, the Contractor shall promptly pay the excess to the Owner without interest, provided however, that the amount of such payment to the Owner shall in no event exceed the total amount of instalments already paid by the Owner (without interest) and the cost of the OFE, if any.
|
30.6.5
|
If the proceeds of sale are insufficient to pay such total amounts payable as aforesaid, the Owner shall promptly pay the deficiency together with interest to the Contractor upon request.
|
30.6.6
|
The Owner hereby irrevocably and unconditionally grants to the Contractor full power and authority to sell the Vessel in accordance with the terms of this Article 32, to take all such steps as may be necessary to complete the sale, to receive the sale proceeds into its own account and to keep or retain the same or to apply the same in the manner set out in this Article 32 and for the purposes of such sale to confer legal and beneficial title and ownership in the Vessel to the buyer, deliver the Vessel to such buyer and do all acts and things as many be necessary for the purposes of giving effect to such sale including but not limited to the execution or signing of any contract, memorandum of agreement, bill of sale, certificate or document, or assignment of its right under the PRICO
®
License Agreement.
|
33.
|
TERMINATION FOR CONVENIENCE
|
31.
|
The Owner may in any event terminate this Agreement for any reason or for its own convenience at any time by: (i) giving not less than ten (10) Days’ notice in writing to the Contractor during the period of time commencing from the Effective Date and ending on the effective date of the Owner’s Notice to Proceed; or (ii) giving not less than sixty (60) Days’ notice in writing to the Contractor on and after the effective date of the Owner’s Notice to Proceed. In such event the Contractor shall be entitled to recover from the Owner, including but not limited to by way of set-off from the payment made pursuant to Article 2.1.2 (if the Owner’s Notice to Proceed is not yet effective) or the First Instalment (if the Owner’s Notice to Proceed has become effective), as the case may be, in full and final satisfaction of all claims: -
|
(a)
|
For the Works performed until termination (less any amounts previously paid to the Contractor for the Works);
|
(b)
|
The cost of any uninstalled equipment or materials, not already included in Article 33.1 (a);
|
(c)
|
Any reasonable additional amount incurred by the Contractor as a result of termination of the part or parts of the Works including any unavoidable liability to subcontractors, suppliers and vendors directly related to termination of part(s) of the Works (including the Early Works). In the event that: (i) the Agreement is terminated for the Owner’s convenience at any time between the Effective Date and 1 January 2017 (inclusive); and (ii) the Owner has not issued the Owner’s Notice to Proceed; and (iii) there has been no further agreement for the performance of Early Works or Early Sub-Contract Works other than those specified in Article 3.2 as of the Date of Agreement (meaning Limited Notices to Proceed have been issued pursuant to each of Articles 3.2.1, 3.2.2, and 3.2.3), such amount payable pursuant to this Article 33.1(c) shall not exceed the sum of: (I) any and all fees (including termination fees) payable to third parties (such as DNV Consulting and MOSS) incurred by the Contractor in the performance of the FEED Studies Update; and (II) any and all costs incidental to the Contractor’s performance of the FEED Studies Update pursuant to Article 3.2.3.1 (including, but not limited to out-of-pocket costs; incidentals; travel and accommodation expenses in line with the Contractor’s corporate policies) but excluding the Contractor’s own man-hour costs;
|
(d)
|
Such amount as will indemnify the Contractor for any amount which may become payable by the Contractor to the Sub-Contractor as a consequence of the termination by the Contractor of the GANDRIA Topsides Agreement pursuant to Clause 42 therein; and
|
(e)
|
an additional payment determined as follows:
|
i.
|
if this Agreement is terminated for the Owner’s convenience prior to the effectiveness of the Owner’s Notice to Proceed (pursuant to Article 4.4), the Owner shall pay the Contractor US$2,000,000.
|
ii.
|
Not used
|
iii.
|
for any termination for convenience by the Owner subsequent to the effectiveness of the Owner’s Notice to Proceed (pursuant to Article 4.4), the Owner shall pay to the Contractor Fifteen percent (15%) of the balance of the Conversion Price.
|
31.1
|
Any monies remaining after the set-off in Article 33.1 shall be retained by the Contractor and immediately applied as an interest-free pre-payment for sums due or to become due and payable under, at the Owner’s sole discretion, either (i) the Engineering, Procurement and Construction Contract in respect of the m.v. HILLI dated 22 May 2014; or (ii) the Engineering, Procurement and Construction Contract in respect of the m.v. GIMI dated 27 October 2014. In the event that there are no further sums due or to become due under the aforementioned agreement, all such monies (if any) shall be returned to the Owner within 14 Days. If there is any sum that remains outstanding to the Contractor after the set-off in Article 33.1 then the Owner shall pay to the Contractor such sum within 14 Days.
|
31.2
|
Upon receipt of such payment, the Contractor shall redeliver to the Owner the Vessel, any uninstalled equipment or materials and Plans. Without prejudice to any other rights or remedy which the Contractor may have, if the Owner does not within 14 Days of the date of termination, make payment to the Contractor in accordance with this Article or furnish security for such payment on terms satisfactory to the Contractor, the provisions of Articles 32.5 to 32.7 shall apply.
|
34.
|
WARRANTY
|
32.
|
Subject to the provisions set forth herein, Contractor undertakes to remedy any defect(s) in the Works (but not in the Sub-Contract Works) which are due to defective design, defective material and/or bad workmanship on the part of Contractor and/or its subcontractors provided that the defect(s) is/are discovered within a period of either: (i) 18 months after the date of Redelivery; or (ii) the earlier of twelve (12) months after either the original planned date of First Gas as set forth in Appendix K of the GANDRIA Topsides Agreement or the actual date of First Gas, whichever is earlier, (“
Warranty Period
”) and a notice thereof is duly given to the Contractor as hereinafter provided.
|
32.1
|
The Contractor's sole obligation in respect of defects in the Sub-Contract Works shall be to assign to the Owner such rights as the Contractor may have in that respect against the Sub-Contractor which the Owner may pursue at its sole risk and expense, indemnifying the Contractor for any costs, expenses or liabilities including in respect of its or the Sub-Contractor's legal costs and the costs of any litigation.
|
32.2
|
The Owner shall notify the Contractor in writing of any defect(s) for which a claim is made under this Article 34 as promptly as possible after discovery thereof. Such notice shall contain a description of the nature and extent of the defect(s). The Contractor shall have no obligation for any defect(s) discovered prior to the expiry of the Warranty Period (or Extended Warranty Period, in a case where such period applies under this Article 34) unless notice of such defect(s) is received by the Contractor promptly after discovery of the defect and in any event no later than 30 Days after the expiration of the Warranty Period (or Extended Warranty Period, in a case where such period applies under this Article 34).
|
32.3
|
The extent of the Contractor’s obligation upon receipt of such notice is (1) to, at the Contractor’s cost and expense, repair or replace and thereby remedy such defect at the Contractor’s Yard or (2) to reimburse the Owner the costs of such repair or replacement in the event that such repair or replacement are not carried out at the Yard but at another location provided that the maximum reimbursement allowed or claimable hereunder shall not exceed 115% of the costs of carrying out such repair or replacement at Contractor’s Yard under this Article 34. If the Contractor advises the Owner in writing that such repair or replacement is to be made in the Yard, then the Owner will either return the Vessel (or the part or item affected where feasible to detach it from the Vessel) to the Yard at the Owner’s costs and risk, for such repair or replacement or if the Owner advises the Contractor in writing that it is not convenient for the Owner to so return the Vessel or component to the Yard, then in such event, the Contractor shall pay to the Owner the amount stated in (2) above, after prompt inspection and admission of the defect, in lieu of the Contractor making such repair or replacement.
|
32.4
|
In the event that any repair or replacements are provided by the Contractor and/or its subcontractors during the Warranty Period, the Warranty Period in respect of such repairs or replacements shall be extended for the remaining balance of the Warranty Period or a period of 6 months from the date upon which the same is carried out, whichever is the longer period, provided that the total accumulated period of warranty in respect thereof shall not under any circumstances exceed either: (i) a period of 24 months after the date of Redelivery; or (ii) the earlier of eighteen (18) months after either the original planned date of First Gas as set forth in Appendix I of the GANDRIA Topsides Agreement or the actual date of First Gas, whichever is earlier (“
Extended Warranty Period
”).
|
32.5
|
The Contractor shall have no responsibility for any other defects whatsoever in the Vessel than the defects specified in Article 34. Nor shall the Contractor in any circumstances be responsible or liable for the transportation of the Vessel to and from the Yard (or the costs thereof) or to any other location to carry out or perform the repair or replacement of any defect warranted herein, or for any loss of time, loss of profit or earning or demurrage directly or indirectly occasioned to the Owner by reason of the defects specified in Article 34.1 or due to repairs or other works done to the Vessel to remedy such defects, nor for any consequential or direct or indirect or special losses, damages or expenses.
|
32.6
|
The Contractor shall not be responsible for any defect in any part of the Vessel which may subsequent to Redelivery have been replaced or in any way repaired by any other contractor, or for any defects which have been caused or aggravated by omission or improper use and maintenance of the Vessel on the part of the Owner, its employees or agents or by ordinary wear and tear or by any other circumstance beyond the control of the Contractor. For the avoidance of doubt, this warranty shall also not extend to defects in any of the OFE for which the Owner shall seek recourse exclusively from the vendors of the relevant OFE.
|
32.7
|
The warranty contained in this Article 34 shall be in lieu of and shall replace any other liability, guarantee, warranty, remedy, condition and/or term imposed or implied by the law, customary or statutory or otherwise. The remedies contained in this Article 34 shall be the Owner’s sole and exclusive remedies in relation to any and all defects warranted under this Article 34.
|
35.
|
LIABILITIES & INDEMNITIES
|
33.
|
Except for liquidated damages expressly provided for in this Agreement, the Contractor and the Contractor’s Group shall not in any event nor under any circumstances, whether as a result of breach of contract, warranty, indemnity, tort (including negligence), strict liability or otherwise, be liable for any loss of profit or revenues, loss of use of any equipment, cost of capital, cost of substitute equipment, facilities, services or replacement power, downtime costs, claims of the Owner’s partners or customers for such damages, whether deemed to be direct or indirect and whether or not foreseeable or disclosed at the time of this Agreement, or for any special, consequential, incidental, indirect or exemplary or punitive damages suffered by the Owner , and the Owner shall release and hold harmless the Contractor’s Group from such claims.
|
33.1
|
Notwithstanding any provision in this Agreement, the GANDRIA Topsides Agreement or the GANDRIA Direct Agreement to the contrary or any inconsistency in or across them, it is agreed between the Parties that the Contractor’s total and entire liability under this Agreement (other than the Sub-Contract Works) and the GANDRIA Direct Agreement, including warranty and damages (liquidated or unliquidated), tort (including negligence and breach of statutory duty) or otherwise in relation to or in connection with this Agreement and/or the repair, modification or conversion of the Vessel and/or the Works and/or the performance by the Contractor of its obligations in the GANDRIA Topsides Agreement shall not exceed United States Dollars Forty Million U.S.$40m and the Owner releases the Contractor from any and all liability in excess thereof. This shall apply regardless of any act, default, omission or negligence, in whatever form or degree, and whether sole, partial, concurrent or contributory on the part of any person within the Contractor’s Group and regardless of any other breach of duty or liability, whether strict, statutory, contractual or otherwise, by any person within Contractor’s Group.
|
33.2
|
Notwithstanding any provision herein to the contrary or inconsistent herewith, it is agreed between the Parties that the Sub-Contractor’s total and entire liability shall be in accordance with the requirements stated in the GANDRIA Topsides Agreement.
|
33.3
|
Until the Owner has fully and completely performed and discharged all its duties, liabilities and obligations under this Agreement, the Owner shall remain the sole, legal and equitable owner of the whole of the Vessel and shall not transfer legal or equitable ownership of the Vessel to any third party or create or permit any lien, charge, debt, mortgage or any other claim whatsoever over or in relation to the Vessel, other than a lien and a mortgage in favour of the Contractor pursuant to the terms of this Agreement.
|
33.4
|
Without prejudice to any other rights or remedy which the Contractor may have, whether under this Agreement, under common law, statute, or otherwise and whether in rem or in personam:
|
33.4.3
|
The Vessel, all her equipment (whether installed on board or not) whenever the same may come into the Contractor's possession, custody or control, the OFE and all goods, materials, Plans, Project Information, documents (including but not limited to the Vessel's certificates), choses-in-action, monies (including but not limited to any insurance proceeds), items and properties in the possession, custody or control of the Contractor (collectively the "Lien Property") shall be subject to a particular and general lien and right of detention for:
|
33.4.3.1
|
all monies, sums, amounts and payments due in respect of the Lien Property, including but not limited to monies, sums, amounts and payments due and/or arising under this Agreement and the GANDRIA Direct Agreement; and
|
33.4.3.2
|
any particular or general balance or other sums, monies, amounts and payments due from the Owner to the Contractor, including but not limited to berthing, mooring, wharfage and dock charges or dues, storage fees costs of any equipment, goods or materials or manpower supplied to the Vessel, the costs of any movement of the Vessel, including the towage thereof, insurance premiums, legal fees and the cost of recovering all such charges, fees, costs and expenses, for the purpose of exercising or preserving or attempting or preparing to exercise and preserve such lien.
|
33.4.4
|
The Contractor, by itself or its servants or agents or otherwise shall be entitled to exercise a possessory lien upon the Lien Property in respect of any monies, sums, amounts and payments howsoever and whatsoever due to the Contractor (including but not limited to those referred to under Article 35.5.1 above) and shall for the purpose of exercising such possessory lien be entitled to take, retain and keep possession of the Lien Property at the sole risk and expense of the Owner.
|
33.5
|
The Owner shall be liable for and pay to the Contractor all costs and expenses howsoever and whatsoever incurred by or on behalf of the Contractor including but not limited to berthing, mooring, wharfage and dock charges or dues, storage fees costs of any equipment, goods or materials or manpower supplied to the Vessel, the costs of any movement of the Vessel including the towage thereof, insurance premiums, legal fees and the cost of recovering all such charges, fees, costs and expenses, for the purpose of exercising or preserving or attempting or preparing to exercise and preserve such lien.
|
33.6
|
Notwithstanding the Redelivery of the Vessel to the Owner or any delivery or re-delivery of any other Lien Property to the Owner, the Contractor shall be entitled to exercise its rights pursuant to Article 35.5 as long as the Lien Property is in the Yard or in the possession of the Contractor. Further, it is agreed that any agreement on the part of the Contractor to permit or allow any Lien Property to leave the Yard for any reason whatsoever (including but not limited to sea trials of the Vessel) whether pursuant to the terms of this Agreement or otherwise shall not prejudice nor be deemed as a waiver of the Contractor's lien (possessory or otherwise) over the Lien Property or of its rights hereunder. It is further expressly agreed that the Contractor's said lien shall re-attach and apply in the event the Lien Property returns to the Yard or to the possession of the Contractor.
|
36.
|
INSURANCE
|
34.
|
Builder’s All Risk (BAR) Insurance:
|
34.1.1
|
From the time of Delivery of the Vessel by the Owner to the Contractor until Vessel Leaving The Yard, the Contractor shall keep the Vessel, the Equipment, and all machinery, materials, equipment, appurtenances and outfit (including OFE which shall not exceed a delivered value of Four Million United States Dollars (U.S.$4m) delivered to the Yard or built into or installed in or upon the Vessel), insured against all risks under coverage corresponding to the Institute of London Underwriters’ Institute Clauses for Builders’ Risks (1/6/88) (hereafter referred to as the “
BAR
”). The amount of such insurance coverage shall, up to the date of Vessel Leaving The Yard, be an amount at least equal to the aggregate of (a) Forty Million United States Dollars (U.S.$40m) being the value of the Vessel on arrival at the Yard, (b) the aggregate of the payments made by the Owner to the Contractor, (c) the value of the OFE as and when any of them are delivered to the Contractor at the Yard up to the limit mentioned hereinbefore, and (d) Fifty Million United States Dollars (U.S.$50m) to cover the Owner’s execution costs. All losses under such policy shall be payable to the Contractor.
|
34.1.2
|
In the event the Vessel is damaged by any insured cause whatsoever prior to Vessel Leaving The Yard and:
|
(a)
|
Such damage is not determined by the underwriters to be an actual or a constructive total loss of the Vessel, the Contractor and/or the Owner shall apply the amount recovered under the BAR policy referred to in Article 36.1.1 above to the repair of such damage reasonably satisfactory to the Owner and the Classification Society, and the Owner shall accept the Vessel if completed in accordance with this Agreement; or
|
(b)
|
Such damage is determined by the underwriters to be an actual or constructive total loss of the Vessel, the Contractor shall, with the mutual agreement between the Parties, either:
|
(i)
|
Proceed in accordance with the terms of this Agreement, in which case the amount recovered under the insurance policy shall be applied to the reconstruction of the Vessel, provided the Parties shall have first agreed in writing as to such reasonable postponement of the Redelivery Date and adjustment of other terms of this Agreement including the Contract Price as may be necessary for the completion of such reconstruction; or
|
(ii)
|
Pay the insurance proceeds under the BAR insurance policy to the Owner within sixty (60) days of receipt thereof less the value of the Works performed by the Contractor up to the date the damage occurred (less any amounts already paid by the Owner to the Contractor under this Agreement), whereupon this Agreement shall be deemed to be terminated and all rights, duties, liabilities and obligations of each of the Parties to the other shall terminate forthwith.
|
34.2
|
Hull & Machinery and P & I:
From the time of Vessel Leaving The Yard, the Owner shall maintain comprehensive hull and machinery, protection and indemnity and any operational insurance policies over the Vessel covering at least the value of the Vessel.
|
34.3
|
Co-assurance & Waiver of Subrogation:
The insurance required above to be taken out by the Parties shall name the other Party as co-assured and waive subrogation against the other Party’s group.
|
34.4
|
Other Insurance:
The Parties shall, at their respective cost and expense, effect and maintain the following insurance:
|
34.4.1
|
In the case of the Contractor:
|
(a)
|
Workmen’s Compensation and Employer’s Liability Insurance as prescribed by applicable laws of Singapore;
|
(b)
|
Commercial General Liability Insurance with limits of not less than US$1,000,000 per occurrence and US$2,000,000 in aggregate.
|
34.4.2
|
In the case of the Owner:
|
(a)
|
Any Workmen’s Compensation and Employer’s Liability Insurance or the equivalent thereof covering its employees as prescribed by the states and/or countries of residence of such employees
|
(b)
|
Commercial General Liability Insurance with the same limits as that applicable for the Contractor.
|
37.
|
PATENTS, TRADEMARKS, COPYRIGHTS ETC.
|
35.
|
Machinery and equipment of the Vessel in respect of the Works may bear the patent number, trademarks or trade names of the manufacturers.
|
35.1
|
The Contractor shall defend, indemnify and save harmless the Owner from patent liability or claims of patent infringement of any nature or kind, including costs and expenses for, or on account of any patented or patentable invention made or used in the performance of the Works and also including costs and expenses of litigation, if any.
|
35.2
|
Nothing contained herein shall be construed as transferring any patent or trademark rights or copyright in equipment covered by this Agreement, and all such rights are hereby expressly reserved to the true and lawful owners thereof.
|
35.3
|
The Contractor’s warranty hereunder does not extend to the OFE. The Owner shall defend, indemnify and save harmless the Contractor from patent liability or claims of patent infringement of any nature or kind, including costs and expenses for, or on account of any patented or patentable invention in connection with or related to the OFE and also including costs and expenses of litigation, if any.
|
35.4
|
The Contractor retains all rights with respect to the Specifications and Plans and working drawings, technical descriptions, calculations, test results and other data, information and documents concerning the design and upgrading & conversion of the Vessel and the Owner undertakes not to disclose the same or divulge any information contained therein to any third party without the prior written consent of the Contractor, except where it is necessary for usual operation, repair and maintenance of the Vessel.
|
38.
|
OWNER FURNISHED EQUIPMENT
|
36.
|
The Owner shall at its own risk, cost and expense, supply and deliver to the Contractor all OFE at the warehouse or other storage of the Yard in proper condition ready for installation in or on the Vessel, in accordance with the time schedule stated in Appendix 4 hereto or such other time schedule as may be mutually agreed between the Parties.
|
36.1
|
In order to facilitate installation by the Contractor of the OFE in or on the Vessel, the Owner shall furnish the Contractor with necessary specifications, plans, drawings, instruction books, manuals, test reports and certificates required by the rules and regulations within the time schedule stated in Appendix 4 hereto. The Owner, if so requested by the Contractor, shall without any charge to the Contractor, cause the representatives of the manufacturers of the OFE to assist the Contractor in installation thereof in or on the Vessel and/or to carry out installation thereof by themselves or to make necessary adjustment thereof at the Yard.
|
36.2
|
The delivery dates mentioned in Appendix 4 are based on the Delivery of the Vessel to the Contractor by the Delivery Date. In the event of any delay in the Delivery of the Vessel to the Contractor, the delivery dates or delivery periods mentioned in Appendix 4 shall be extended by the period of delay in the Delivery of the Vessel to the Contractor or such dates or periods as the Parties may otherwise mutually agree in writing.
|
36.3
|
Any and all of the OFE shall be subject to the Contractor’s reasonable right of rejection, as and if they are found to be unsuitable or in improper condition for installation.
|
36.4
|
Should the Owner fail to deliver any of the OFE within the prescribed time, the Redelivery Date shall be extended for a period of such delay in delivery or such longer period caused to the performance of the Works if the Contractor is able to demonstrate the same . In such event, the Owner shall be responsible and pay to the Contractor for all losses and damages incurred by the Contractor by reason of such delay in delivery of the OFE and such payment shall be made upon Redelivery of the Vessel. If delay in delivery of any of the Owner’s OFE exceeds thirty (30) Days, then, the Contractor shall be entitled to proceed with the Works without installation thereof in or on the Vessel, without prejudice to the Contractor’s other rights as hereinabove provided, and the Owner shall accept and take Redelivery of the Vessel so upgraded and converted.
|
36.5
|
The Contractor shall be responsible for storing and handling with reasonable care the OFE after delivery thereof at the Yard and shall at its own cost and expense, install them in or on the Vessel, unless otherwise provided herein or agreed by the Parties provided always that the Contractor shall not be responsible for quality, efficiency and/or performance of any of the OFE. The Owner acknowledges and agrees that the Contractor shall also not be responsible for any failure to meet the requirements contained in the Specifications that are attributable to the quality, efficiency and/or performance of any of the OFE.
|
39.
|
CONFIDENTIALITY
|
37.
|
All information acquired or furnished by the Parties to each other that is:
|
(i)
|
designated in writing as “confidential” or “proprietary” at the time of written disclosure; or
|
(ii)
|
verbally designated as “confidential” or “proprietary” at the time of verbal disclosure and is confirmed to be “confidential” or “proprietary” in writing within
10
Days after the verbal disclosure
|
(a)
|
is or becomes generally available to the public other than from disclosure by the receiving Party;
|
(b)
|
is or becomes available to the receiving Party or its representatives or Affiliates on a non-confidential basis from a source other than the disclosing Party when the source is not, to the best of the receiving Party’s knowledge, subject to a confidentiality obligation to the disclosing Party;
|
(c)
|
is already known by the receiving Party at the time of disclosure;
|
(d)
|
is required to be disclosed by law, a valid legal process or a government agency (including the requirements of the relevant stock exchange);
|
(e)
|
is independently developed by the receiving Party, its representatives or Affiliates, without reference to Confidential Information; and
|
(f)
|
is approved for disclosure in writing by an authorized representative of the disclosing Party
|
37.1
|
The confidentiality obligations under this Agreement shall survive for a period of five (5) years from the Date of Agreement.
|
37.2
|
Neither Party hereto shall issue any press release or provide any information to the media or any other Third Party without the prior written approval of the other Party, except where it is necessary to satisfy securities laws or regulations and stock exchange requirements.
|
40.
|
INTELLECTUAL PROPERTY RIGHTS IN RELATION TO THE CONTRACTOR’S SCOPE
|
38.
|
For the purposes of this Article 40 only, “
Party
” shall mean either the Owner, the Contractor or the Sub-Contractor, and “
Parties
” shall refer to the Owner, the Contractor and the Sub-Contractor collectively.
|
38.1
|
Each Party may at any time provide another Party with certain Project Information. Such Party shall retain the Intellectual Property Rights in the Project Information it provides. The Parties shall forthwith return all the Project Information to the Party it received such Project Information from upon the completion of both the Works and Sub-Contract Works, or upon the earlier termination of this Agreement or the GANDRIA Topsides Agreement; provided, however, that each Party may retain for its own use only one record copy of such Project Information for the sole purpose of this Agreement and shall not use it for any other purpose. Each Party shall save, indemnify, defend and hold harmless all other Parties from all claims, losses, damages, costs (including legal costs), expenses, and liabilities of every kind and nature for, or arising out of, any alleged infringement or infringement of Intellectual Property Rights of the Project Information by any member of such Party's Group in respect of Project Information provided by it.
|
38.2
|
All Derivative Works developed or created by the Contractor or the Sub-Contractor for the Project (as defined in the GANDRIA Direct Agreement) shall be deemed to be and considered as “
Commissioned Works
” under applicable laws and regulations except where such Derivative Works are (i) created or made by the Sub-Contractor and (ii) any other agreement (including but not limited to the PRICO® Licence Agreement) governs, controls, pertains to or otherwise deals with the same or substantially similar subject matter, in which case the Parties expressly agree that such Derivative Works shall not constitute, be deemed to be or be considered to be Commissioned Works and such other agreement or agreements shall prevail over this Agreement in respect of such Derivative Works. The Parties agree and acknowledge that the Owner is the commissioning party of the Commissioned Works and all Intellectual Property Rights in the Commissioned Works will solely vest ab initio in the Owner, provided that if for any reason, whether by the operation of law or otherwise, the Contractor and/or Sub-Contractor still retains any rights, title, interests or benefits in the Commissioned Works, each of the Contractor and the Sub-Contractor hereby agrees to assign, including by way of present assignment of future rights, to the Owner all rights that it may have in the Commissioned Works to the Owner. If, for whatever reason, any Commissioned Works does not vest in the Owner by virtue of this Article 40.3, then the Contractor and/or the Sub-Contractor, as applicable shall hold such Commissioned Works on trust for the Owner’s sole use and benefit and shall promptly assign such Commissioned Works to the Owner upon its request. If the Commissioned Works cannot be assigned to the Owner by operation of applicable laws or otherwise, the Contractor and Sub-Contractor shall grant to the Owner a world-wide, paid-up, royalty-free and irrevocable sole license to use, exploit, distribute, promote, sub-license third parties, and to create further derivative works of all Commissioned Works.
|
38.3
|
The Contractor may use the Commissioned Works as may be necessary for the purposes of this Agreement only. The Contractor shall not use, disclose to or procure a third party to use or disclose any of the Commissioned Works for any other purpose. For the avoidance of doubt, Articles 40.3 and 40.4 do not apply to the Contractor Background Intellectual Property.
|
38.4
|
The Owner hereby grants to the Contractor an irrevocable (except in the event of a breach of this license), non-transferable, nonexclusive, royalty-free license to utilise the Owner Background Intellectual Property, Commissioned Works only to the extent necessary for the construction, operation, maintenance, repair, or alteration of the Works. Notwithstanding any provision in this Agreement to the contrary, rights to intellectual property developed, utilized or modified in the performance of the Sub-Contract Works, excluding the Owner Background Intellectual Property, Derivative Works, and the Contractor Background Intellectual Property, shall remain the exclusive property of the Sub-Contractor. The Contractor hereby grants to the Owner an irrevocable (except in the event of a breach of this license), non-transferable, nonexclusive, royalty-free license to utilise the Contractor Background Intellectual Property only to the extent necessary for the operation, maintenance, rectification or repair of the Works.
|
38.5
|
Nothing contained in this Article 40 shall be construed as limiting or depriving the Contractor of its rights to use its Project Information, the Contractor Background Intellectual Property and other basic knowledge and skills (but for the avoidance of doubt this shall not include the Owner Background Intellectual Property, or the Commissioned Works) to design or carry out other projects or work for itself or others, whether or not such other projects or work are similar to the work to be performed pursuant to this Agreement. In circumstances where the Contractor is a party to a validly-created and existing contract with the Owner for the repair, modification and conversion of any Moss Type liquefied natural gas tanker into a floating liquefied natural gas production and storage unit using a two-tiered open lower deck sponson attached to the ship’s sides, then the Contractor shall notify the Owner before undertaking the same work for a party that is not a Party to the GANDRIA Direct Agreement. The Contractor shall have the right to retain and use copies of drawings, documents, and engineering and other data furnished or to be furnished by the Contractor and the information contained therein.
|
38.6
|
Rights to the Contractor Background Intellectual Property shall at all times remain the property of the Contractor. Rights to the Owner Background Intellectual Property shall at all times remain the property of the Owner.
|
38.7
|
The Contractor and the Owner shall not use or include any third party Intellectual Property Rights in the performance of this Agreement unless (i) it has all licences, consents and approvals as may be necessary to use or include such third party Intellectual Property Rights in the relevant manner and (ii) it procures any licences or consents as may be necessary to enable the Contractor to use the third party Intellectual Property Rights in accordance with the Agreement.
|
38.8
|
The Owner and the Contractor hereby warrant to each other that:
|
(a)
|
it is the owner of the Project Information provided by it and that it has the right to assign and grant the licences and rights to the other in accordance with this Article 40;
|
(b)
|
it has not granted and will not grant any rights to any third party which conflict with or may adversely affect the rights granted to the other under this Article 40;
|
(c)
|
the performance of their respective obligations in accordance with this Agreement and/or the GANDRIA Topsides Agreement and/or the GANDRIA Direct Agreement will not infringe any rights including, but not limited to Intellectual Property Rights, of any third party, the Owner Background Intellectual Property, the Contractor Background Intellectual Property, or the Sub-Contractor Background Intellectual Property (as the case may be), or the Project Information provided by any other Party to the Party giving this warranty; and
|
(d)
|
it has all necessary rights and licences for the performance of its obligations under this Agreement, the GANDRIA Topsides Agreement, and the GANDRIA Direct Agreement.
|
38.9
|
The Contractor shall defend, protect and indemnify and hold the Owner (including its assigns) harmless from and against any third party claims, demands, expenses, liabilities, losses, damages or proceedings (including legal costs on an indemnity basis) in connection with any infringement or alleged infringement of copyright, registered design, trademark rights or patent arising from, out of or in connection with:
|
(a)
|
the Contractor’s and/or the Owner’s, consistent with the intended purpose, use or possession of the Works of the Contractor under this Agreement or any component or element thereof;
|
(b)
|
the use, consistent with the intended purpose, of any materials or equipment by the Contractor in the performance of the Works by the Contractor under this Agreement or the manner in which the same is used; and/or
|
(c)
|
the use, consistent with the intended purpose, of designs, drawings and specifications furnished to the Owner by the Contractor.
|
38.10
|
The Owner shall defend, protect and indemnify and hold the Contractor (including its assigns) harmless from and against any third party claims, demands, expenses, liabilities, losses, damages or proceedings (including legal costs on an indemnity basis) in connection with any infringement or alleged infringement of copyright, registered design, trademark rights or patent arising from, out of or in connection with:
|
(a)
|
the Owner's and/or the Contractor's, consistent with the intended purpose, use or possession of the Owner Background Intellectual Property, the Works and the Sub-Contract Works or any component or element thereof; and/or
|
(b)
|
the use, consistent with the intended purpose, of Project Information, designs, drawings and specifications furnished to the Contractor and/or the Sub-Contractor by the Owner.
|
38.11
|
The Contractor’s obligations pursuant to this Article 40 are limited solely to the Contractor’s Scope.
|
41.
|
NOTICES
|
39.
|
Every notice demand or other communication under this Agreement shall be sent by email confirmed in writing. Such notice shall be sent to the respective addresses set out below or to such other address as may be notified in writing for such purpose: -
|
39.1
|
Every notice demand or other communication sent by email shall be deemed to have been received:
|
39.1.1
|
if received during working hours, at the time of receipt; or
|
39.1.2
|
otherwise at the start of working hours on the next Business Day.
|
42.
|
HEALTH, SAFETY, ENVIRONMENT & QUALITY ASSURANCE
|
40.
|
The Contractor will perform the Works in compliance with, and shall cause its employees and subcontractors to comply, in all respects, with the provisions of Appendix 6 and all applicable safety and health laws, rules and regulations of governmental agencies having jurisdiction in the country where any of the Works is being performed. The Contractor is also responsible for providing and maintaining a safe and healthy work environment on its premises. The Contractor shall provide, at no additional cost to the Owner, all necessary safety induction of the Owner’s personnel at the Yard. The Owner shall, and shall ensure that each member of the Owner’s personnel shall, at all times, comply with all the Contractor’s regulations and Applicable Laws relating to health, safety and the environment.
|
40.1
|
The Contractor shall provide and keep readily available in good working order all safety appliances as well as those reasonably necessary in accordance with good industry practices for safe operation and prescribed by proper bodies and competent authorities.
|
40.2
|
The Contractor shall inform the Owner of any injury/damage to its personnel and/or equipment and to the Owner’s personnel and/or materials. The Owner shall inform the Contractor during the performance of the Works, or Sub-Contract Works at the Yard or the Project Site immediately of any situation that is potentially hazardous to workers.
|
40.3
|
The Owner’s personnel must possess applicable safety training certificates, and prior to performing work at the Yard, shall be required to have completed a safety induction course (referred to at the Yard as a Shipyard Safety Instruction Course (General Trade)).
|
40.4
|
The Owner shall provide each member of the Owner’s personnel at the Yard and Project Site with, or require them to have, appropriate Personal Protective Equipment (PPE) and shall ensure that they use them correctly while working in the Yard’s premises or facilities or the Project Site.
|
40.5
|
The Owner shall ensure that its employees and each member of the Owner's personnel at the Yard and Project Site comply with the health, safety and environmental requirements in this Agreement. The Contractor shall be entitled to bar any employee of the Owner or any member of the Owner’s personnel who fails to comply with such health, safety and security regulations and Applicable Laws from entry to the Yard’s premises.
|
40.6
|
The Contractor shall give all notices and otherwise fully comply with all laws, statutes, regulations, ordinances, rules, standards, orders or determinations of any governmental authority (including related determinations, interpretations, orders or opinions of any judicial or administrative authority) which has jurisdiction over the Contractor and the performance of this Agreement pertaining to the protection or conservation of the air, land, human health, industrial hygiene or other aspects of the environment which are directly applicable to the performance of this Agreement.
|
40.7
|
The Contractor represents and warrants to the Owner that in the performance of the Works, the operations will not contain or otherwise have incorporated into them any chemical, material or other substance defined as or included in the definition of “hazardous substance”, “hazardous material”, “hazardous chemical”, “hazardous chemical substance”, “hazardous waste” or “toxic substance” or words of similar meaning and regulatory effect, as such terms are defined under any environmental laws, any broader definition of such terms that are used by a state or locality that has jurisdiction over the performance of this Agreement or any interpretation by administrative or judicial authorities, or any other chemical, material or substance, exposure to which is prohibited, limited or regulated by any governmental authority or which may or could pose a hazard to human health and safety, such definitions, representations and warranties shall exclude however hydrocarbons, discharged water and production related chemicals.
|
40.8
|
This Agreement shall be carried out under “Quality Assurance” conditions and in accordance with the Specifications. The Quality Plan shall be submitted to the Owner. Without prejudice to the Contractor’s obligations hereunder, the Owner reserves the right to confirm to the Contractor in writing its agreement to the above documentation within thirty (30) Days of submission. If the Owner does not respond within the prescribed time, the documentation submitted shall be deemed accepted by the Owner.
|
40.9
|
The Owner shall indemnify in full, defend and hold the Contractor harmless from and against any and all claims, losses, liability, damages, costs, expenses, demands or proceedings whatsoever and howsoever arising due to and as a result or consequence of asbestos or radioactive or other hazardous waste (or the discharge thereof) from the Vessel and the legal costs in connection therewith (on an indemnity basis) including but not limited to illness, death or personal injury of any person (including, but not limited to, members of the Contractor’s Group).
|
43.
|
GENERAL
|
41.
|
Change in Control
Any change in control in the Owner (save where the control of the Owner passes to an Affiliate of the Owner) shall be permitted only with the prior written consent of the Contractor, such consent not to be unreasonably withheld or delayed. A change in control in the Owner is deemed to occur when a person or persons acting in concert acquire(s) direct or indirect control of (i) over fifty percent (50%) of the total voting rights conferred by all the issued shares in the capital of the Owner which are exercisable in the general meeting of shareholders or (ii) the majority composition of the board of directors of the Owner.
|
41.1
|
Severability
If any of the provisions of this Agreement is or becomes invalid, illegal or unenforceable in any respect under any law, the validity, legality and enforceability of the remaining provisions of this Agreement shall continue in force and shall not in any way be affected or impaired.
|
41.2
|
Headings
Headings are used only for reference and for convenience and do not define, limit or describe the scope of intent of any Article and shall be ignored for purposes of interpretation of this Agreement.
|
41.3
|
Independent Contractor
In the performance of this Agreement, the Contractor is and shall remain an independent contractor. Neither the Contractor nor any one employed by the Contractor shall be deemed for any purpose to be the employee, agent, servant, borrowed servant or representative of the Owner in the performance of the Works.
|
41.4
|
Assignment
Neither Party shall assign this Agreement or any part thereof without the prior written consent of the other Party except that the Owner may assign the Agreement to:
|
(a)
|
Its Affiliate;
|
(b)
|
Its lender(s) or financier(s) for the project involving or involving, inter-alia, the Works;
|
41.5
|
Third Party Rights
Nothing in this Agreement is intended to confer any benefit on or intended to be enforceable by or against any person who is not a party to this Agreement. Accordingly, no person other than the Parties may enforce this Agreement by virtue of the Contracts (Rights of Third Parties) Act 1999.
|
41.6
|
Counterparts
This Agreement may be signed in any number of counterparts, all of which taken together shall constitute one and the same instrument. Any Party may enter into this Agreement by signing any such counterpart and each counterpart may be signed and executed by facsimile and shall be as valid and effectual as if executed as all original.
|
44.
|
TAXES & DUTIES
|
42.
|
The Contractor shall bear and pay all taxes and duties imposed in Singapore in connection with the execution and/or performance of the Works, excluding any taxes and duties imposed in Singapore upon the OFE.
|
42.1
|
The Owner shall bear and pay all taxes and duties imposed outside Singapore in connection with the execution and/or performance of this Agreement, except taxes and duties imposed upon those items to be procured by the Contractor for the performance of the Works at the Contractor’s Yard.
|
45.
|
INTERPRETATION
|
43.
|
This Agreement and the rights and obligations of the Parties hereunder shall be governed by and construed in accordance with the laws of England.
|
43.1.1
|
This Agreement contains the entire agreement and understanding between the Parties and supersedes all prior negotiations, representations, letters of intent, term sheets, undertakings and agreements on any subject matter of this Agreement. Any and all previous agreements and/or arrangements between the Parties shall be superseded and become null and void unless incorporated into this Agreement either by specific reference there to or by attachment to this Agreement as an Appendix hereto.
|
43.2
|
All provisions or requirements contained in the Specifications and the Articles of this Agreement are intended to amplify, explain and complement each other. In the event of any conflict or inconsistency between these documents, the Articles shall take precedence over the Specifications.
|
46.
|
DISPUTE RESOLUTION
|
44.
|
In the event of any dispute arising out of or relating to this Agreement, or the breach, termination or invalidity thereof, the same shall be brought to the attention of each Party’s executive management who shall attempt to resolve such dispute.
|
44.1
|
If such dispute cannot be mutually resolved by the Parties, the Parties agree that legal proceedings may be brought in the courts of England to resolve such dispute and the Parties hereby irrevocably submit to the non-exclusive jurisdiction of such courts.
|
44.2
|
With regard to any dispute or difference related to technical matters affecting the Vessel, such may be resolved and determined by the Classification Society if so and to the extent agreed by the Parties in writing whereupon the Parties agree to be bound by the decision of the Classification Society and such decision shall be final and binding upon the Parties.
|
44.3
|
The Contractor irrevocably appoints as its agent for service of proceedings issued by the Owner in the courts of England: Nausch, Hogan & Murray (U.K.), 11-13 Crosswall London, EC3N 2JY, United Kingdom.
|
44.4
|
The Owner irrevocably appoints as its agent for service of proceedings issued by the Contractor in the courts of England: Golar Management, 13
th
Floor, One America Square, 17 Crosswall, London EC3N 2LB.
|
44.5
|
The Owner irrevocably consents to be joined in any proceedings between the Contractor and the Sub-Contractor which may be relevant to, arise out of, or has or may have any consequence upon the rights or obligations of the Contractor under, pursuant to or in connection with this Agreement.
|
47.
|
SECURITIES
|
45.
|
Subject to Article 47.2 below and upon receipt of the Contractor’s notification pursuant to Article 4.1, as security for the performance of the Owner’s obligations under this Agreement the Owner shall execute and deliver to the Contractor within the time specified in Article 4.3, at the Owner’s own cost and expense, a first ranking ship mortgage on the Vessel in favour of the Contractor, in the form set out in Appendix 10 (Form of Vessel Mortgage) governed by the laws of the Marshall Islands, and which shall constitute a valid first preferred maritime lien on the Vessel under the laws of the Marshall Islands in which the Vessel is registered. Such mortgage shall remain effective, valid, unencumbered and existing until the date of Vessel Leaving The Yard, after which the provisions of Article 47.2 below shall apply.
|
45.1
|
Upon Vessel Leaving The Yard, the ship mortgage granted by the Owner to the Contractor under Article 47.1 above shall be released and discharged, and the Owner shall execute and deliver, at its own cost and expense, a bank guarantee in the form set out in Appendix 10 (Form of Bank Guarantee) from the Singapore branch of an international bank with a rating not less than AA based on Standard & Poor’s credit rating reasonably acceptable to the Contractor. Such bank guarantee shall be effective from the date of Vessel Leaving The Yard until the satisfaction of all of the Owner’s payment obligations under this Agreement. For the avoidance of doubt, the Contractor shall not be obliged to release or discharge the ship mortgage until it has received such bank guarantee.
|
45.2
|
As security for the performance of the Contractor’s obligations under this Agreement, the Contractor agrees and undertakes to deliver to the Owner a duly and validly executed Parent Company Guarantee in the form of Appendix 10 from Keppel Offshore & Marine Ltd within 14 Days from the Date of Agreement.
|
48.
|
COMPLIANCE WITH ANTI-BRIBERY LAWS AND SANCTIONS
|
46.
|
For purposes of this Article 48 the following term shall have the following meaning:
|
46.1
|
The Contractor represents and warrants that, in connection with this Agreement and the Works:
|
46.1.1
|
it is knowledgeable about Anti-Bribery Laws applicable to the performance of this Agreement and shall comply with all such Anti-Bribery Laws; and
|
46.1.2
|
neither it nor, to the best of its knowledge and belief, any other member of the Contractor’s Group have made, offered or authorised or will make, offer or authorise any payment, gift, promise or other advantage, whether directly or through any other person or entity, to or for the use or benefit of any Government Official or any person where such payment, gift, promise or other advantage would (i) compromise a facilitation payment; and/or (ii) violate the Anti-Bribery Laws.
|
46.2
|
The Contractor undertakes to immediately notify the Owner if, in connection with this Agreement or the Works, it receives or becomes aware of any request from a Government Official or any person for any payment, gift, promise or other advantage of the type mentioned in Article 48.2.2.
|
46.3
|
The Owner confirms that its appointment of the Contractor was expressly made on the basis that Anti-Bribery Laws would not be violated. The Contractor acknowledges that the contents of this Agreement may be disclosed by the Owner to governmental authorities (or their duly-authorised agents) for the purpose of demonstrating compliance with this Article 48.
|
46.4
|
The Contractor shall indemnify, defend and hold harmless the Owner’s Group from and against, any and all losses, damages, claims, expenses (including legal costs), fines and penalties incurred by the Owner’s Group arising out of the Contractor’s representations in this Article 48 being untrue or arising out of the Contractor’s breach of any of its representations, warranties and undertakings in this Article 48.
|
46.5
|
Failure to comply with any obligation under this Article 48 will be regarded as due cause for the Owner to give notice to terminate this Agreement in accordance with Article 32.1(g) (Contractor’s default).
|
46.6
|
The Contractor and all other members of the Contractor’s Group subject to the Anti-Bribery Laws shall maintain adequate internal controls and procedures to assure compliance with Anti-Bribery Laws, including procedures to ensure that all transactions in connection with the Works are accurately recorded and reported in its books and records to truly reflect the activities to which they pertain, such as the purpose of each transaction and to whom it was made or from whom it was received.
|
46.7
|
The Contractor shall maintain, either physically, by electronic media or on microfilm, all records and information related to this Agreement and/or any work statement in connection therewith for a period of five (5) years after the later of: (i) the end of the Warranty Period; or (ii) in the event of termination, the date of termination.
|
46.8
|
In the event an Authority undertakes a lawful investigation of the Owner’s violation of obligations under the Anti-Bribery Laws the Owner shall have the right to employ, at the Owner’s expense, an unaffiliated third party to audit all information, rates and costs and expenses related to this Agreement in connection therewith at any time during and within five (5) years after the later of: (i) the end of the Warranty Period; or (ii) in the event of termination, the date of termination. Subject to the consent of the relevant Authority or Authorities, the Contractor shall be provided with a complete copy of the audit upon its completion and prior to its submission to the Owner solely for the purpose of ensuring that none of the Contractor’s pricing, mark-up and profit margins are disclosed. The third party authorised by the Owner may have access at all reasonable times to any place where the records are being maintained and the Contractor shall afford every reasonable facility for this right of access. The third party authorised by the Owner shall have the right to reproduce and retain copies of any of the aforesaid records or information subject to an obligation of confidentiality consistent with the one in this Agreement, and subject further to the exclusion of any documents to the extent they show the Contractors pricing, mark-up and profit margins, except to the extent necessary to disclose alleged violations of the Anti-Bribery Laws, comply with Applicable Laws or the instructions of the Authorities. The Contractor shall implement all agreed recommendations arising from audits within a time mutually agreed with the Owner.
|
46.9
|
Upon the Owner’s request the Contractor will, as soon as reasonably practical, provide the person authorised by the Owner with all records relating to the Contractor and/or, to the extent reasonably available, any work statement in connection therewith which are created or kept by any other member of the Contractor’s Group.
|
46.10
|
The Contractor shall not, and shall not knowingly permit or authorise any member of the Contractor’s Group to, directly or indirectly, procure any equipment or any enter into any arrangement or do anything in connection with this Agreement or the Works with, or for the benefit of, any Restricted Party or undertake the Works in a manner, or do or omit to do anything, that would reasonably be expected to result in the Owner or any member of the Owner’s Group being in breach of any Sanctions or becoming a Restricted Party.
|
•
|
Conversion Scope
|
•
|
Conversion scope
|
•
|
Annex 1: Re-measurable
|
•
|
Annex 2: Broken Down Repair Costs
|
Owner
|
Contractor
|
……………………………………
|
……………………………………
|
Name:
|
Name:
|
Title:
|
Title:
|
Owner
|
Contractor
|
……………………………………
|
……………………………………
|
Name:
|
Name:
|
Title:
|
Title:
|
Owner
|
Contractor
|
……………………………………
|
……………………………………
|
Name:
|
Name:
|
Title:
|
Title:
|
Confidential
Execution Version
|
||||
|
Dated
9 September 2015
|
|
||
|
||||
GOLAR HILLI CORPORATION
as Seller
FORTUNE LIANJIANG SHIPPING S.A.
as Buyer
|
||||
|
Memorandum of Agreement
|
|
||
|
(1)
|
Fortune Lianjiang Shipping S.A.(Reg. No. 71932), a company incorporated in the Republic of the Marshall Islands with its registered office at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH96960 in its capacity as Buyer; and
|
(2)
|
Golar Hilli Corporation (Reg. No. 68975), a company incorporated in Republic of The Marshall Islands with its registered office at Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands, MH96960 in its capacity as Seller)
|
(A)
|
Golar Hilli Corporation in each of its separate capacities as Borrower, Seller and Bareboat Charterer, Golar LNG Limited as Guarantor, and Fortune Lianjiang Shipping S.A. in each of its separate capacities as Lender, Buyer and Owner have entered into a Common Terms Agreement dated
9 September 2015
setting out the defined terms in respect of the transaction.
|
(B)
|
The Seller, the Builder and the Sub-Contractor (as applicable) have entered into the Conversion Contracts pursuant to which the "Hilli", a second hand LNG vessel is to be converted to a Floating Liquefied Natural Gas Vessel as more particularly described in Clause 2 ("
Vessel
").
|
(C)
|
The Conversion Works in respect of the Vessel are due to be completed on or before the Cancelling Date.
|
(D)
|
The Seller has now agreed to transfer and sell the Vessel to the Buyer and the Buyer has agreed to purchase and take delivery of the Vessel from the Seller in accordance with this MOA.
|
(E)
|
Upon the Buyer taking delivery of the Vessel under this MOA, the Buyer will charter the Vessel to the Bareboat Charterer in accordance with the Bareboat Charter.
|
1
|
Definitions
|
1.1
|
Terms and conditions defined in the Common Terms Agreement shall have the same meaning when used in this MOA, including the Recitals hereto, unless otherwise defined herein.
|
1.2
|
Unless a contrary indication appears, in the event of any conflict or inconsistency between any provision of this MOA and any provision of the Bareboat Charter, the provisions of the Bareboat Charter shall prevail.
|
2
|
Sale of the Vessel
|
3
|
Purchase Price
|
3.1
|
The Purchase Price shall be the Market Value unless the Market Value is greater than the Initial Project Budget, in which case, the Purchase Price shall be an amount equal to the Initial Project Budget. Where the Market Value is less than the amount outstanding under the Pre-Delivery Financing Agreement, the Purchase Price shall be that Market Value and any shortfall shall be for the Seller’s account.
|
3.2
|
In all cases and under no circumstances shall the Purchase Price exceed the Initial Project Budget.
|
3.3
|
The Buyer shall appoint two Approved Valuers to each carry out a Valuation on the Vessel. The Approved Valuers shall provide the Buyer and the Seller with a Valuation Certificate at least three
|
3.4
|
The reasonable costs of providing all such Valuation Certificates by the Approved Valuers shall be for the Seller's account.
|
4
|
Pre-Delivery Financing and Buyer's Obligation to Take Delivery
|
4.1
|
It is agreed between the Seller and the Buyer that during the Construction Period the Buyer shall provide the Pre-delivery Financing to the Seller to assist with the funding of its instalment payments payable pursuant to the Conversion Contracts.
|
4.2
|
Upon receipt of the Seller's written Notice of Actual Readiness pursuant to Clause 6.2 below, the Buyer shall on the Delivery Date be obliged to take Delivery of the Vessel from the Seller and pay the Purchase Price (as calculated in accordance with Clause 3) in accordance with Clause 5.1 subject to the following conditions being met on or before 30 August 2018 (the Cancelling Date):
|
(a)
|
The Revenue Start Date has occurred and the Seller certifies in writing thereof;
|
(b)
|
The Buyer (acting reasonably) is satisfied that on Delivery, all sums due and owing under the Pre-Delivery Financing Agreement will be fully repaid;
|
(c)
|
the Seller and the Technical Adviser have carried out a joint physical inspection ("
Final Joint Inspection
") of the Vessel and the Vessel's Classification records, and declared in writing to the Buyer that the Vessel is acceptable and ready for delivery, with present Class maintained, free from any damage, class conditions and/or recommendations affecting the Vessel's Class, and with all class certificates and trading certificates (both national and international) clean and valid;
|
(d)
|
a copy each of the Technical Adviser's report (as required under the Technical Adviser's Scope of Work) and class reports (where applicable and reasonably requested by the Buyer) has been given to the Buyer;
|
(e)
|
Clause 11 of the MOA regarding the Vessel's condition on Delivery has been complied with;
|
(f)
|
the Bareboat Charter and the Bareboat Charter Guarantee has been duly executed prior to the entering of this MOA and the Bareboat Charterer has confirmed in writing to the Owner that it will accept the Vessel and will take delivery of the same under the Bareboat Charter;
|
(g)
|
The conditions precedents in Box 4 of the Binding Term Sheet (or, if relevant, equivalent provision in the TSA or a Replacement Sub-Charter) have been satisfied or waived by the parties to the Binding Term Sheet (or, if relevant, the TSA or a Replacement Sub-Charter), and the Binding Term Sheet (or, if relevant, the TSA or a Replacement Sub-Charter) has become effective prior to the entering of this MOA;
|
(h)
|
The Acceptable Sub-Charter and the Acceptable Sub-Charter Guarantee is duly executed and is effective;
|
(i)
|
Evidence that the 1st priority Mortgage which the Builder has over the Vessel is discharged or will be discharged immediately prior to Delivery;
|
(j)
|
The Seller has procured from the Builder, a no claims certificate confirming that the Builder releases, waives and discharges forever the Vessel from any and all claims, debts, liabilities, demands, obligations, costs, expenses, actions, and causes of action of every nature, character and description, vested and contingent, whether known or unknown which the Builder may have against the Seller, arising out of or in connection with the Conversion Contracts;
|
(k)
|
each and all Security Documents and the acknowledgments from the Acceptable Sub-Charterer and the Acceptable Sub-Charter Guarantor in relation to the notices of assignment issued pursuant to the Assignment of the Acceptable Sub-Charter and the Acceptable Sub-Charter Guarantee have been duly executed and delivered in the form satisfactory to the Buyer;
|
(l)
|
the receipt by the Buyer of all documents and evidence set out in Clause 8 of this MOA;
|
(m)
|
the Seller's confirmation in writing that Clause 9 of this MOA has been complied with; and
|
(n)
|
The Seller's confirmation in writing that all Consents and Project Authorisations required in connection with the Project and/or the Vessel or otherwise at the time this representation is made have been obtained or effected and are in full force and effect and valid under applicable local law.
|
5
|
Payment of the Purchase Price and Upfront Amount
|
5.1
|
Upon all conditions set out in Clause 4.2 being satisfied and complied with, the Buyer shall pay on the Delivery Date pay to the Seller the
Actual Purchase Price
in an amount based on the following formula: AP = P less U less C, and less O.
|
(o)
|
AP
stands for the actual purchase price payable by the Buyer to the Seller on the Delivery Date.
|
(p)
|
P
stands for the Purchase Price.
|
(q)
|
U
stands for the Upfront Amount.
|
(r)
|
C
stands for the First Charter-Hire payable by the Bareboat Charterer to the Owner under the Bareboat Charter, and once deducted from the Purchase Price by way of a set off shall be deemed as a full payment of the First Charter-hire by the Bareboat Charterer to the Owner.
|
(s)
|
O
stands for the outstanding principal and accrued interest payable by the Seller to the Buyer on the Delivery Date and calculated in accordance with the Pre-Delivery Financing Agreement, which shall be deemed to have been paid in full by the Seller pursuant to the Pre-Delivery Financing Agreement once being applied and set off against the Purchase Price.
|
5.2
|
The Parties agree that the Upfront Amount shall be provided on an unsecured, and interest free basis and that it shall only be applied in accordance with this MOA and Clause 38.1 (
Upfront Amount
) of the Bareboat Charter.
|
5.3
|
On the Delivery Date, the Buyer shall, upon delivery of the Vessel and subject to the conditions set out in Clause 4.2 being satisfied and complied with, pay the Actual Purchase Price in Dollars to the Sellers' bank nominated bank account notified by the Seller to the Buyer in writing no later than ten (10) Business Days in advance. Any charge from the Buyer's bank, including intermediate bank(s), if any, incurred for remitting the Balance shall be for the Buyer's account and any charge from the Seller's bank, including intermediate bank(s), if any, incurred in receiving the Balance shall be for the Seller's account.
|
6
|
Time and place of delivery and notices
|
6.1
|
Provided Notice of Actual Readiness has not yet been given, the Seller shall keep the Buyer reasonably well informed of the progress of the Conversion Works and the Vessel's itinerary including when the Vessel is on the Project Site. In particular, the Seller shall inform the Buyer when the following milestones have been achieved:-
|
(a)
|
When the Vessel leaves the Builder's Yard for the Singapore anchorage to carry out remaining commissioning of the Conversion Works, and a Certificate of Vessel Leaving the Yard has been signed pursuant to Article 18 of the EPC Contract;
|
(b)
|
When the Vessel has been re-delivered upon completion of the remaining commissioning of the Conversion Works at the Singapore anchorage, pursuant to Article 20 of the EPC Contract;
|
(c)
|
When Sailaway has occurred;
|
(d)
|
When the Vessel has arrived on the Project Site to carry out the Project Site Works;
|
(e)
|
When the Ready for First Gas Certificate has been issued by the Seller to the Sub-Contractor;
|
(f)
|
When Project Site Commissioning has been completed and the Seller has issued the Ready for Start-up Certificate pursuant to Article 24 of the EPC Contract;
|
(g)
|
When the start-up and Performance Tests in Article 25 of the EPC Contract have been completed and the Guaranteed Performance Certificate has been signed-off by the Seller;
|
(h)
|
When each of the milestones referred to in Box 5 (a) to (d) of the Binding Term Sheet or TSA (if applicable) or equivalent provisions under a Replacement Sub-Charter have been met and the delivery windows referred to therein;
|
(i)
|
When the Revenue Start Date is likely to occur.
|
6.2
|
When the Vessel is in every respect physically ready for delivery in accordance with this MOA, and the Revenue Start Date has occurred, the Seller shall tender a written Notice of Actual Readiness of the Vessel to the Buyer. If none of the circumstances set out in Clause 6.3 below have occurred, the Vessel shall be delivered and taken over safely afloat at the Project Site on the Delivery Date as follows:
|
(a)
|
Subject to the conditions in Clause 4.2 being satisfied, the Vessel shall be delivered by the Seller to the Buyer; however in any case, the Delivery shall take place before the Cancelling Date; and
|
(b)
|
Upon Delivery of the Vessel to the Buyer under this MOA, the Vessel shall immediately be delivered to the Bareboat Charterer under the Bareboat Charter.
|
6.3
|
If the Vessel becomes an actual, constructive or compromised total loss before delivery and/or before the provisions of Clause 8 (Documentation) have been satisfied by the Seller, this MOA shall become null and void
|
7
|
Spares, bunkers and other items
|
7.1
|
The Seller shall deliver the Vessel to the Buyer "as is, where is" and with everything belonging to her on board and on shore in accordance with the terms of the Conversion Contracts and this MOA. All spare parts and spare equipment including spare propeller(s)/propeller blade(s), spare anchor, if any, belonging to the Vessel at the time of delivery used or unused, whether on board or not shall become the Buyer's property on delivery, but spares on order are excluded. The radio installation and navigational equipment shall be included in the sale, along with all unused stores and provisions without extra payment.
|
7.2
|
An inventory of unused bunkers, lubricants/lubricating oil, grease, fuel oil or other liquids, and consumables supplied by the Builder and left on board at delivery of the Vessel, shall be taken over and paid for by the Seller. Upon delivery of the Vessel from the Seller to the Buyer, such unused bunkers, lubricants/lubricating oil, grease, fuel oil or other liquids, and consumables shall be deemed to be taken over and be paid for by the Bareboat Charterer. No payment shall be made by the Buyer to the Seller for such unused bunkers, lubricants/lubricating oil, grease, fuel oil or other liquids, and consumables on board on the Delivery Date of the Vessel. The Seller shall provide the original payment receipt on the Delivery Date to show that they have paid such unused bunkers, lubricants/lubricating oil, grease, fuel oil or other liquids, and consumables.
|
8
|
Documentation
|
(a)
|
In exchange for payment of the Purchase Price in Clause 5 above and as a condition precedent to Delivery in Clause 4.2 above, the Seller shall furnish the Buyer with delivery documents as follows:-
|
(i)
|
One original bill(s) of sale in a form recordable in the Flag State, transferring the title of the Vessel from the Seller to the Buyer and warranting that the Vessel is free from all mortgages, encumbrances and maritime liens or any other debts whatsoever, duly notarially attested and legalised or apostilled, as required by the Flag State;
|
(ii)
|
original builders certificate or equivalent under the Conversion Contracts;
|
(iii)
|
confirmation of Class issued not later than 72 hours prior to Delivery (Buyer to accept provisional / interim certificates if applicable) confirming that the Vessel is in Class and free of condition/recommendation;
|
(iv)
|
transcript of register (or equivalent) issued by the competent authorities stating that the Vessel is free from registered encumbrances, dated on the Delivery Date and faxed to the Buyer at the closing with the original to be couriered to the Buyer promptly after Delivery;
|
(v)
|
Certified copies of the constitutional documents of the Seller, or a statement from an officer of the Seller that no changes have been made since such document was delivered to the Buyer in connection with the execution of the Pre-Delivery Financing Agreement, the Bareboat Charter and the Acceptable Sub-Charter;
|
(vi)
|
Certified copy of a good standing certificate of the Seller dated not later than three (3) Business Days prior to Delivery;
|
(vii)
|
Minutes of a Meeting of the Shareholders and Board of Directors of the Seller approving the sale of the Vessel to the Buyers, authorising the execution of the Bill of Sale, Protocols of Delivery and Acceptance and any other documents required to effect the sale and transfer of the Vessel to the Buyer and the granting of a Power of Attorney in respect of the same;
|
(viii)
|
An original Power of Attorney duly executed by the Seller appointing and authorising one or more Attorney(s)-in-Fact, inter alia, to act on behalf of the Seller to execute, sign and deliver the Bill of Sale, Protocol of Delivery and Acceptance and delivery of the Vessel to the Buyer, duly notarized and in the performance of this MOA, duly notarially attested and legalised or apostilled (as reasonably required);
|
(ix)
|
A Certificate signed by the Company Secretary of the Seller certifying the identity of the current directors of the Seller;
|
(x)
|
An original commercial invoice stating the main particulars of the Vessel and the Balance and signed by the Seller;
|
(xi)
|
Copy of the Document of Compliance (DOC) in respect of the Manager;
|
(xii)
|
Copy of the Vessel's Safe Manning Certificate (SMC);
|
(xiii)
|
Copy of the Vessel's International Ship Security (ISSC);
|
(xiv)
|
Declaration of warranty issued by the Builder stating that the Vessel is free from any liens, charges, claims, mortgages, taxes, or other encumbrances of whatsoever nature;
|
(xv)
|
An original Protocol of Redelivery and Acceptance signed by the Builder and the Seller confirming the date and time of Redelivery of the Vessel;
|
(xvi)
|
All documents to be delivered at Redelivery in accordance with the EPC Contract;
|
(xvii)
|
A copy of each Management Agreement between the Bareboat Charterer and the Manager in respect of the technical and commercial management of the Vessel;
|
(xviii)
|
A Certificate of Deletion (if applicable) of the Vessel from the Vessel's Registry or a Letter of Undertaking to provide the Certificate of Deletion and closed CSR from the present Flag within thirty (30) Business Days of the Delivery Date;
|
(xix)
|
the Seller's letter of confirmation that to the best of their knowledge the Vessel has not sustained any grounding or any other damage to the underwater parts since the Joint Final Inspection and is not black-listed by any government, state, country political sub division and union.
|
(xx)
|
Valuation Certificate prepared by the Approved Valuers which are required to determine the Purchase Price in accordance with Clause 3;
|
(xxi)
|
The reports from the Technical Adviser as required pursuant to the Technical Adviser's Scope of Work confirming that the Conversion Works carried out on the Vessel have been in accordance with the specifications set out in the Conversion Contracts and the relevant performance requirements set out in the Binding Term Sheet or the TSA (if applicable) and that the Vessel is in a position to earn sufficient monies pursuant to the Acceptable Sub-Charter to enable the Bareboat Charterer to meets all its payment obligations under the Bareboat Charter, and that the Vessel is in all material respects ready and in a condition acceptable to the Buyer, acting reasonably;
|
(xxii)
|
Evidence reasonably satisfactory to the Buyer that any defaults of the Borrower under the terms of the Pre-Delivery Financing Agreement in respect of the Vessel have been remedied by the Borrower or waived by the Lender;
|
(xxiii)
|
Evidence reasonably satisfactory to the Buyer that the conditions precedent under the Bareboat Charter have been or will be met on Delivery and that the Vessel may be immediately delivered by the Owner to the Bareboat Charterer under the Bareboat Charter;
|
(xxiv)
|
Any such additional documents as may reasonably be required by the competent authorities of the Flag State for the purpose of registering the Vessel;
|
(xxv)
|
Copies of all insurance policies, cover notes and certificates of entry for the Vessel in compliance with the terms of the Bareboat Charter showing the Owner as a co-assured;
|
(xxvi)
|
A copy of the Acceptable Sub-Charter and the Acceptable Sub-Charter Guarantee.
|
(b)
|
At the time of Delivery, the Buyer shall provide the Seller with:
|
(i)
|
A certified true copy of the Buyer's constitutional documents;
|
(ii)
|
Evidence that all necessary corporate, shareholder and other action has been taken by the Buyer including the original Minutes/Resolution of Buyers' Board of Directors authorising the execution of the Power of Attorney and any documents required to effect the purchase and transfer of the Vessel from the Sellers and any other necessary transaction document, or copies of the same, duly notarially attested and legalised or apostilled (as required by the Flag State);
|
(iii)
|
Original Power Of Attorney of the Buyers, authorising the attorney(s)-in-fact, inter alia, to perform its obligations under the MOA and to effect payment of the Purchase Price and other payments, the execution of the Protocol of Delivery and Acceptance and any other documents which may be required to transfer and register the Vessel, and to do any acts as may be required to effect the purchase, transfer and registration of the Vessel, duly notarised and apostilled; and
|
(iv)
|
Quiet Enjoyment Letter.
|
(c)
|
If at the time of delivery of the Vessel the Classification Society or any other party has not issued the final certificates, then the Buyer will accept temporary certificates. The Seller shall arrange for such temporary certificates to be replaced with the permanent ones as soon as practical but in no event later than the time when the temporary certificates expire, and also provide the Buyer with a letter of undertaking to provide these certificates.
|
(d)
|
If any of the documents listed in Sub-clauses (a) and (b) above are not in the English language they shall be accompanied by an English translation by an authorised translator.
|
(e)
|
The Buyer and Seller shall at the time of Delivery sign and deliver to each other a Protocol of Delivery and Acceptance confirming the date and time of delivery of the Vessel from the Seller to the Buyer.
|
(f)
|
At the time of the physical delivery on board the Vessel, and concurrent with the exchange of documents in Sub-clause (a) and Sub-clause (b) above, the Seller shall hand to the Buyer the Classification certificate(s), plans, drawings, record books and manuals (excluding ISM/ISPS manuals), which are on board the Vessel. All other documents and certificates which are on board and pertinent to the Vessel shall also be handed over to the Buyer unless the Seller is required to retain the same, in which case the Buyer has the right to take copies and leave the photocopies on board the Vessel. All other documents and technical documentation which may be in the Seller's possession shall following Delivery be forwarded to the Buyer after Delivery, if they so request with reasonable forwarding charges, if any, to be for the Buyer's account. The Seller may keep the Vessel's log books but the Buyer has the right to take copies of the same. In instances where documents are to remain on the Vessel at all times the Buyer is permitted to take copies on board the Vessel at their own cost.
|
(g)
|
A copy each of the following documents duly executed by the relevant parties to the documents as follows:-
|
(i)
|
A copy of the Bareboat Charter duly executed by the Owner and the Bareboat Charterer;
|
(ii)
|
A copy of the Acceptable Sub-Charter duly executed by the Bareboat Charterer and the Acceptable Sub-Charterer;
|
(iii)
|
A copy of the Bareboat Charter Guarantee duly executed by the Bareboat Charter Guarantor and the Owner; and
|
(iv)
|
A copy of the Acceptable Sub-Charter Guarantee.
|
(h)
|
Any other documents that may be reasonably requested by the Mortgagee including but not limited to acknowledgments of any assignments by the Buyer or any Security Documents.
|
9
|
Encumbrances
|
10
|
Taxes, fees and expenses
|
11
|
Condition on delivery
|
11.1
|
The Vessel shall be delivered to the Buyer in accordance with the specifications set out in the Conversion Contracts, and shall thereafter be inspected and approved by the Technical Advisor and classed in accordance with the specifications in the Conversion Contracts and this MOA. The Vessel shall be delivered to the Buyer with her Class maintained without condition/recommendation and free from any damage affecting class and classification certificates and national/international certificates as at the Delivery Date. Following the execution of the MOA, the Seller shall not agree to any material modification or changes to the specifications set out in the Conversion Contracts and the MOA without the Buyer's prior written consent (such consent not to be unreasonably withheld or delayed) save for Permitted Amendments.
|
11.2
|
The Seller shall notify the Buyer upon immediately becoming aware of any material dispute with the Builder arising out of or in relation to the Conversion Contracts. The Seller shall also notify the Buyer within ten (10) Business Days of becoming aware that the Seller or the Builder is entitled to terminate the Conversion Contracts. A dispute is considered material if when it is adversely determined, might have a Material Adverse Effect.
|
11.3
|
The Seller shall not terminate the Conversion Contracts or enter into mitigation or dispute resolution procedures regarding a material dispute with the Builder unless approved by the Buyer (such consent not to be unreasonably withheld or delayed) and shall do so if instructed by the Buyer (acting reasonably). If the Seller enters into mitigation or dispute resolution procedures with the Builder without the Buyer's consent in breach of this Clause 11.3, the Buyer shall be entitled (but not obliged to) cancel this MOA.
|
12
|
Additional Rights of Inspection
|
12.1
|
Subject to agreeing timely visits with the Manager, the Buyer and/or the Technical Adviser shall have the right to attend any of the performance tests and any commissioning including Project Site Commissioning being carried out on the Vessel.
|
12.2
|
The Technical Adviser shall have the right to inspect the Vessel at any time during the Conversion Works by giving at least three (3) Business Days' notice and the Seller shall use reasonable endeavours to keep the Technical Adviser informed of the Vessel's schedule, of any upcoming milestones and of any inspections and tests as set out in Clause 6.1.
|
12.3
|
The Seller shall give the Technical Adviser at least three (3) Business Days advance notice of the Final Joint Inspection to be carried out for the purposes of the Scheduled Commissioning Start Date occurring.
|
12.4
|
The Seller shall make available for Buyer's and/or the Technical Adviser's review all relevant and material correspondence, notices and other documents related to technical (as opposed to commercial) matters and shall provide copies of the same upon request, the costs of such request to be for the Seller's account.
|
13
|
Name/markings
|
14
|
Buyer's default
|
15
|
Seller's default
|
15.1
|
The Buyer shall be entitled to cancel this MOA in the event that by the Cancelling Date:-
|
(a)
|
the Seller fails to deliver the Vessel; or
|
(b)
|
the Seller fails to meet the conditions in Clause 4.2 and/or to provide the documents in Clause 8 for the purposes of Delivery in Clause 6 of this MOA; or
|
(c)
|
if the Binding Term Sheet or TSA (whichever is applicable) and the Perenco Security Arrangements is terminated for whatever reason, and a Replacement Sub-Charter is not secured before the Delivery Date.
|
15.2
|
In the event the Seller fails to deliver the Vessel as referred to in Clause 15.1, it shall compensate the Buyer for its direct losses and for all reasonable expenses together with interest whether or not the Buyer cancels this MOA or accelerates the repayment of the Pre-delivery Financing in accordance with the terms of the Pre-Delivery Financing Agreement, provided that the Buyer shall not be entitled to compensation if such losses or expenses arose out of gross negligence or wilful misconduct of the Buyer.
|
16
|
Automatic Termination
|
(a)
|
the Seller fails to satisfy the Conditions Precedent set out in Schedule 2, Part A of the Pre-delivery Financing Agreement;
|
(b)
|
When Mandatory Cancellation under Clause 6.5 of the Pre-delivery Financing Agreement is triggered;
|
(c)
|
When the Lender exercises its rights under Clause 18.25 of the Pre-delivery Financing Agreement pursuant to the occurrence of an Event of Default which is continuing.
|
17
|
Assignments
|
18
|
Representations and warranties
|
18.1
|
Each Party to this MOA represents and warrants to the other Party to this MOA that:
|
(a)
|
It is duly incorporated and validly existing under the laws of its jurisdiction of incorporation and has power to carry on its business as it is now being conducted and to own its property and other assets;
|
(b)
|
Subject to legal reservations, it has full power, capacity and authority to execute, deliver and perform its obligations under this MOA and all necessary corporate, shareholder and other actions have been taken to authorise the execution, delivery and performance of the same and this MOA constitutes its valid and legally binding obligations.
|
18.2
|
On the Delivery Date, each of the Parties to this MOA shall be deemed to repeat the respective representations and warranties in Clause 18.1 as if made with reference to the facts and circumstances existing on such date and such representations and warranties, and the respective rights of the Parties hereunder, shall survive the execution of this MOA and the payment of the Balance.
|
19
|
Severability of provisions
|
20
|
Counterparts
|
21
|
Third Party rights
|
22
|
Law and Jurisdiction
|
22.1
|
This MOA and any non-contractual obligations connected with it shall be governed by and construed in accordance with English law.
|
22.2
|
Any dispute arising out of or in connection with this MOA, including any question regarding its existence, validity or termination, shall be referred to the Hong Kong International Arbitration Centre ("HKIAC") and finally resolved by arbitration under the rules promulgated by the HKIAC (the "HKIAC Rules"), which HKIAC Rules are deemed to be incorporated by reference into this clause. The seat, or legal place, of arbitration shall be Hong Kong. The language to be used in the arbitral proceedings shall be English.
|
23
|
Notices
|
For the Buyer:
|
c/o CSSC (Hong Kong) Shipping Company Limited, Shanghai Office, Room 608, Marine Tower , No.1 Pudong Avenue, Shanghai, PRC
Attention: Mr Teng Fei / Mr Zhou Shen
Email: project@csscshipping.com
Fax: +86 21 6886 3070
|
For the Seller:
|
c/o Golar Management Ltd, 13th Floor, One America Square, 17 Crosswall, London EC3N 2LB, United Kingdom
Attention: Mr Brian Tienzo
Email: brian.tienzo@golar.com
Fax: +44 (0)207 063 7901
|
24
|
Entire Agreement
|
SELLER
|
|
|
SIGNED
by
For and on behalf of
GOLAR HILLI CORPORATION
In the presence of
|
)
)
)
|
/s/ Brian Tienzo
Attorney-in-fact
|
|
|
Signature/Title
|
BUYER
|
|
|
SIGNED
by
For and on behalf of
FORTUNE LIANJIANG SHIPPING S.A.
In the presence of
|
)
)
)
|
/s/ Yang Li
|
|
|
Signature/Title
|
(a)
|
a conversion contract dated [
l
] entered into between (i) Keppel Shipyard Limited (the "
Builder
") and (ii) [
l
] for the conversion of the vessel named "Golar Hilli" and registered under the [
l
] flag with IMO number [
l
] (the "
Vessel
") together with all addenda thereto (the "
Conversion Contract
"); and
|
(a)
|
a memorandum of agreement dated [
l
] (the "
MOA
") and made between Golar Hilli Corporation (the "
Seller
") and Fortune Lianjiang Shipping S.A. (the "
Buyer
") in respect of the Vessel.
|
(i)
|
The Redelivery Date has occurred;
|
(ii)
|
The Vessel has been converted in compliance with the Conversion Contracts save for the Project Site Commissioning referred to in the EPC Contract which is still continuing; and
|
(iii)
|
The Vessel was accepted without reservation by the Seller under the Conversion Contracts (save for the Project Site Commissioning) for the purpose of commencing work under the Acceptable Sub-Charter.
|
Section 1.01
|
Definitions 1
|
Section 2.01
|
Purchase and Sale of the Shares; Deposit 5
|
Section 2.02
|
Closing 5
|
Section 2.03
|
Place of Closing 6
|
Section 2.04
|
Purchase Price Adjustments 6
|
Section 2.05
|
Satisfaction of Certain Intercompany Receivables 6
|
Section 2.06
|
Vessel Modifications 6
|
Section 3.01
|
Organization; Good Standing and Authority 6
|
Section 3.02
|
Authorization, Execution and Delivery of this Agreement 6
|
Section 3.03
|
No Conflicts 7
|
Section 3.04
|
No Consents 7
|
Section 4.01
|
Organization; Good Standing and Authority 7
|
Section 4.02
|
Authority and Authorization; Execution and Delivery of this Agreement 7
|
Section 4.03
|
No Conflicts 8
|
Section 4.04
|
No Consents 8
|
Section 4.05
|
Legal and Beneficial Title to Shares; No Encumbrances 8
|
Section 5.01
|
Organization; Good Standing and Authority 8
|
Section 5.02
|
Capitalization; No Options 9
|
Section 5.03
|
Organizational Documents 9
|
Section 5.04
|
Validity of Certain Agreements 9
|
Section 5.05
|
No Conflicts 9
|
Section 5.06
|
Title to Vessel; Encumbrances 9
|
Section 5.07
|
Litigation 10
|
Section 5.08
|
Indebtedness to and from Officers, etc 10
|
Section 5.09
|
Personnel 10
|
Section 5.10
|
Contracts and Agreements 10
|
Section 5.11
|
Compliance with Law 11
|
Section 5.12
|
No Undisclosed Liabilities 11
|
Section 5.13
|
Disclosure of Information 11
|
Section 5.14
|
Insurance 11
|
Section 5.15
|
U.S Tax Classification 11
|
Section 6.01
|
Flag 12
|
Section 6.02
|
Classification 12
|
Section 6.03
|
Maintenance 12
|
Section 6.04
|
Liens 12
|
Section 6.05
|
Safety 12
|
Section 6.06
|
No Blacklisting or Boycotts 12
|
Section 6.07
|
No Options 13
|
Section 6.08
|
Vessel Performance 13
|
Section 7.01
|
Covenants of Seller Prior to the Closing 13
|
Section 7.02
|
Covenant of Buyer Prior to the Closing 14
|
Section 8.01
|
Conditions of the Parties 14
|
Section 8.02
|
Conditions of Seller 15
|
Section 8.03
|
Conditions of Buyer 15
|
Section 9.01
|
Termination of Agreement 16
|
Section 9.02
|
Amendments and Waivers 16
|
Section 10.01
|
Indemnity by Seller 16
|
Section 10.02
|
Indemnity by Buyer 17
|
Section 11.01
|
Further Assurances 18
|
Section 11.02
|
Powers of Attorney 18
|
Section 11.03
|
Headings; References; Interpretation 19
|
Section 11.04
|
Successors and Assigns 19
|
Section 11.05
|
No Third Party Rights 19
|
Section 11.06
|
Counterparts 19
|
Section 11.07
|
Governing Law 19
|
Section 11.08
|
Severability 20
|
Section 11.09
|
Integration 20
|
Section 11.10
|
No Broker’s Fees 20
|
Section 11.11
|
Notices 20
|
Section 11.12
|
Survival of Representations and Warranties 20
|
SCHEDULE A
|
Insurance A-1
|
EXHIBIT I
|
Form of Letter Agreement I-1
|
By:
|
Name: Pernille Noraas Title: Attorney-in-Fact |
Phone
|
+44 207 063 7900
|
Fax:
|
+44 207 063 7901
|
Attention:
|
Brian Tienzo
|
By:
|
Name: Graham Robjohns Title: Attorney-in-Fact |
Phone
|
+44 207 063 7900
|
Fax:
|
+44 207 063 7901
|
Attention:
|
Brian Tienzo
|
Hull & Machinery Insurance
|
USD 260.000.000
|
Hull Interest Insurance
|
USD 65.000.000
|
Freight Interest Insurance e
|
USD 65.000.000
|
Loss of Hire Insurance
|
USD 50.000 – and with 180 days cover
(Daily amount intended to be increased upon commencement of contract with WAGL) |
War Risks Insurance
|
USD 390.000.000
|
P&I
|
Gard
|
FD&D
|
Gard
|
By:
|
Name: Title: |
By:
|
Name: Title: |
|
|
|
|
Name
|
Jurisdiction of Incorporation
|
|
|
Golar LNG 2216 Corporation
|
Marshall Islands
|
Golar Management Limited
|
United Kingdom
|
Golar GP LLC – Limited Liability Company
|
Marshall Islands
|
Golar LNG Energy Limited
|
Bermuda
|
Golar Gimi Corporation
|
Marshall Islands
|
Golar Hilli Corporation*
|
Marshall Islands
|
Golar Gandria N.V.
|
Netherlands
|
Golar Hull M2021 Corporation
|
Marshall Islands
|
Golar Hull M2022 Corporation
|
Marshall Islands
|
Golar Hull M2023 Corporation
|
Marshall Islands
|
LNG Power Limited
|
United Kingdom
|
Golar Hull M2026 Corporation
|
Marshall Islands
|
Golar Hull M2027 Corporation
|
Marshall Islands
|
Golar Hull M2047 Corporation
|
Marshall Islands
|
Golar Hull M2048 Corporation
|
Marshall Islands
|
Golar LNG NB10 Corp
|
Marshall Islands
|
Golar LNG NB11 Corp
|
Marshall Islands
|
Golar LNG NB12 Corp
|
Marshall Islands
|
Golar LNG NB13 Corp
|
Marshall Islands
|
GVS Corporation
|
Marshall Islands
|
Golar Management Norway AS
|
Norway
|
Golar Commodities Limited
|
Bermuda
|
|
|
|
|
/s/ Gary Smith
|
|
Gary Smith
|
|
Principal Executive Officer
|
|
|
|
|
|
/s/ Brian Tienzo
|
|
Brian Tienzo
|
|
Principal Financial Officer
|
|
/s/ Gary Smith
|
|
Gary Smith
|
|
Principal Executive Officer
|
|
/s/ Brian Tienzo
|
|
Brian Tienzo
|
|
Principal Financial Officer
|
|