Golar LNG (Buy, TP: USD39.00) - Poised for a breakthrough
100% commercial uptime on Hilli, capex below budget, its fast-track FLNG solution, rising LNG prices, and only three liquefaction FIDs since mid-2016 put Golar LNG in a unique position to monetise on stranded gas over the next two to three years with its FLNG concept. We would expect the number of FIDs to increase over the next 12 months, which in combination with Hilli utilisation upsizing, an improving LNG shipping market, and BP FID guided end-2018 would all be significant catalysts. Cash flow from the Sergipe project now also appears only 16 months away. We reiterate our BUY recommendation and USD39 target price.Golar LNG is a midstream liquefied natural gas (LNG) company based in Bermuda. Co. is engaged in the transportation, regasification, liquefaction and trading of LNG. Through its subsidiaries and affiliates, Co. is engaged in the acquisition, ownership, operation and chartering of LNG carriers and floating storage regasification units (FSRUs), and the development of liquefaction projects such as Floating Liquefaction Natural Gas Vessels. Co. owns and operates a fleet of 19 LNG carriers and seven FSRUs, and under management agreements operates Golar LNG Partner LP's fleet of six FSRUs and four LNG carriers.
DNB Markets is the investment banking arm of DNB Bank ASA and is focused primarily on the Nordic region, as well as internationally on niches such as global shipping, energy and related services, and seafood. DNB Markets offers services in FICC, Equities and Investment Banking advisory from offices in Oslo, Stockholm, London, Singapore and New York. Equity research coverage is offered on c250 Nordic companies. DNB was ranked no.2 in Extel Nordic Research 2017. The DNB Markets’ Credit and FICC Macro & FX Research teams are repeatedly highly rated by Prospera Nordic Institutional Investor Surveys.
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