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Höegh LNG secures financing for eighth FSRU

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LNG Industry,

Höegh LNG Holdings Ltd has announced that it has received commitment letters for a US$230 million debt financing for its eighth floating storage and regasification unit (FSRU).

The facility consists of a 12-year export credit agency (ECA) term loan of up to US$150 million backed by Garantiinstituttet for Eksportkreditt ("GIEK") and Eksportkreditt of Norway, as well as a five-year non-amortising commercial bank loan of up to US$80 million funded by ABN AMRO BANK, Danske Bank, Nordea and Swedbank.

The facility is available to fund 65% of the FSRU’s delivered cost, with no employment required, increasing to 75% upon securing long-term employment. Höegh LNG claims that the interest rate will be swapped from floating to fixed, and, at the current market conditions, the fixed interest rate is expected to come in at approximately 4.1%. The facility is still subject to final documentation.

The President and CEO of Höegh LNG, Sveinung J.S. Støhle, said: “With this transaction, Höegh LNG is executing on its financial strategy of diversifying funding sources, while obtaining a flexible and competitive debt financing structure that supports the company's growth strategy. The favourable financing terms reflects Höegh LNG's strong balance sheet and track-record in securing and operating long-term FSRU contracts. We are very pleased with the excellent support we get from the leading ECAs and banks participating in this transaction."

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