Hamilton, Bermuda - 01 Apr 2020
Golar LNG Partners LP (“Golar Partners” or “the Partnership”) announced today an update regarding its financial strategy and ongoing initiatives in response to the recent Covid-19 induced deterioration in the macro-economic environment. This includes a decision to reduce its quarterly common unit distribution and the initiation of a process to seek an extension of the maturity date for its Senior Unsecured Bond Issues maturing in May 2020 (GOLP02, ISIN NO 001 07 36481) (the “GOLP02 Bonds”) and May 2021 (GOLP03, ISIN NO 001 0736481) (the “GOLP03 Bonds”) (together, the “Bond Issues”).
The Partnership’s Board of Directors has approved a reduction in the quarterly common distribution to $0.0202 per unit for the quarter ended March 31, 2020 (from $0.4042 per unit in the previous quarter). Golar Partners believes this reduction is in the best interest of all of its stakeholders during this unprecedented time of market volatility. The Partnership will, as a consequence, retain approximately $109 million of cash flow annually, allowing the Partnership to focus its capital allocation on debt reduction, thus strengthening its balance sheet while providing enhanced financial flexibility to consider capital allocation priorities over time. The reduction will also result in lower breakeven re-contracting rates across the Partnership’s fleet.
The Partnership will continue its review of its structure and strategy to maximize long-term shareholder value once it has completed the process to extend the Bond Issues.
Golar Partners has also issued a summons for a meeting of the holders of the GOLP02 Bonds and the GOLP03 Bonds for the purpose of seeking their approval to an extension of the maturity of both Bond Issues for 18 months subject to certain terms and conditions, the details of which are disclosed in a separate press release.
Golar Partners remains focused on protecting the health and safety of its employees, customers, vendors, and communities in order to ensure that it continues to operate safely and reliably. Together with Golar LNG Limited, Golar Partners has instigated a number of ongoing operational initiatives in response to the challenges posed by the Covid-19 pandemic. All of the Partnership’s assets continue to operate well and in accordance with their existing contractual arrangements thus safeguarding Golar Partners $2.1 billion revenue backlog.
Golar LNG Partners LP press release