Flex Lng Ltd. · NYSE:FLNG
Flex Lng — DNB Bergen (October 2018)
16 slides from Flex Lng's conference presentation, Oct 30, 2018
Slide 1: Corporate Presentation
Corporate Presentation DNB Bergen 30 October 2018 11 | | 2017 2018
Slide 2: Market for seaborne LNG transport is maturing
Market for seaborne LNG transport is maturing From point-to-point utility business to global tradeable commodity business LNG 1.0 LNG 2.0 LNG 3.0 • 1960s to mid 2000s • Mid-2000s – about now • The way of the future • Traditional liner model (P2P) • Portfolio players • Commoditization of LNG • Back2b
Slide 3: Unique fleet comprising 13 modern 5th generation LNGCs
Unique fleet comprising 13 modern 5th generation LNGCs Fleet growth following $300m private placement of equity on 10th of October 2018 bringing MCap >$1bn High Pressure Low pressure ME-GI with Partial ME-GI with Full ME-GI Reliquefaction System Reliquefaction System X-DF Ranger Aurora Rainbow Amber
Slide 4: ME-GI and X-DF vessels with significant fuel cost savings
ME-GI and X-DF vessels with significant fuel cost savings LNGC existing fleet and orderbook by propulsion type # of vessels Other ME-GI / X-DF DFDE/TFDE ST 70 1 Comparison of LNG Ship Types on UTC Basis* 60 0.8 50 0.6 40 0.4 30 0.2 0 20 ST 138k TFDE 160k X-DF 174k 10 0 <1990 1991 1992 1993 1994 1995
Slide 5: FLEX is the leading owner of 5th generation LNGCs
FLEX is the leading owner of 5th generation LNGCs Largest LNG shipping companies (1) FLEX will be the leading operator of 5 th gen LNG vessels (2) 0 5 10 15 20 25 30 35 40 45 Mitsui OSK NYK Qatar Gas Teekay Maran Gas Maritime 13 MISC BW Gas FLEX Nigeria LNG Golar LNG GasLog 5 10 10 10 Kawasaki Kisen
Slide 6: Early phase of recovery of LNGC market
Early phase of recovery of LNGC market Estimated LNGC Spot Earnings Natural Gas Prices by Region • Early phase of the recovery cycle for LNGC shipping • Spot rate improved before winter season 2017/18 • Rates have rebounded after glut of available tonnage depressed rates coming out of the winter ear
Slide 7: And market sold out despite limited arbitrage
And market sold out despite limited arbitrage Source: Arctic Securities Source: Affinity Available spot vessels in different basins Source: Fearnleys • Modern slow-speed two-stroke tonnage above USD 100k mark • Vessel availability significantly reduced as charterers absorbed tonnage to secure capaci
Slide 8: LNGC market has become more liquid
LNGC market has become more liquid Number of spot fixtures (less than 3 months) Number of semi-term fixtures (3mth to 5yrs) Source: Clarksons LNG 88 | | 2017 2018
Slide 9: Glut of LNG coming to the market
Glut of LNG comming to the market Source: Fearnleys 99 | | 2017 2018
Slide 10: Strong structural growth driver for LNG
Strong structural growth driver for LNG • High future demand growth is expected as natural gas increase it’s market share in the energy matrix • All top five growth countries located in Asia • China’s increased demand was about half of the added volume in 2017 and continued strong growth as aim is t
Slide 11: Switching to LNG is as much health policy as energy policy
Switching to LNG is as much health policy as energy and/or environmental policy • In South Asia, air pollution larger health risk than tobacco, cancer, water sanitation and on par with dietary risk Source: Texas A&M University and Science News 11 || 2017 11 2018
Slide 12: Majority of LNGC orderbook already contracted-out
Majority of LNGC orderbook already contracted-out Order book for large LNG carriers Average sailing distances (laden) Source: Fearnleys • About 90 orders for delivery in the period until 2021 • A deficit of about 40 vessels given start-up of about 96.5MMtpa in period 2018-2022 • Increased sailing di
Slide 13: Well positioned to benefit from a tightening LNG shipping market
Well positioned to benefit from a tightening LNG shipping market FLEX is one of the few Owners with uncommitted tonnage being delivered in 2018-2021 The LNG shipping market is expected to gradually tighten from the end of 2018, with Australia, the U.S. and Russia being the driving forces for soaking
Slide 14: US-China trade conflict and impact for LNG trade
US-China trade conflict and impact for LNG trade China’s quarterly LNG import by country # of US cargos to China and US LNG market share in China China’s LNG demand and existing LNG contracts “China is building a new coal-fired power plant every week and is set to surpass America as the biggest sour
Slide 15: Summary
Summary Four LNGCs on the water and nineLNGCs under construction, all Right Ships fitted with 5th generation propulsion (two-stroke low-speed engines) providing substantial fuel savings and larger parcel size The market have re-balanced and is now in early phase of Right Time recovery with higher ch
Slide 16: Q&A
Q&A 16 || 2017 16 2018 2018