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Höegh LNG quits FLNG business to focus on FSRUs

Höegh LNG quits FLNG business to focus on FSRUs
Höegh LNG is exiting the Floating LNG (FLNG) business to focus on Floating Storage Regasification Units (FSRUs).

Although Höegh LNG will complete its obligations towards existing FLNG customers, the company is transferring all its FLNG employees to the FSRU business, impairing its FLNG assets $37m in the fourth quarter of 2015. The move is expected to save $3m in selling, general and administrative expenses.

The company said it saw a high level of activity for FSRU projects, which provide cheaper and faster alternative to building costly LNG import terminals.

Sveinung J.S. Støhle, president & ceo of Höegh LNG, stated: "Given the overall market outlook for LNG and the current state of the financial markets, we believe focusing solely on FSRUs is financially and commercially the best strategy for Höegh LNG.

“We are fully committed to build on our position as the leading FSRU provider, and will take this opportunity to sharpen our focus and strengthen our FSRU team to ensure that we reach our ambition of growing our fleet to 12 FSRUs by 2019."

While its Q4 results are not yet released, Höegh LNG reported profits of $6.9m in its third quarter, compared with $1.9m for the same period in 2014, excluding unrealized gains on derivatives.