Flex Lng Ltd. · NYSE:FLNG
Flex Lng — Investor Presentation (October 2017)
34 slides from Flex Lng's investor presentation, October 2017
Slide 1: Company Presentation
Company Presentation October 2017 11 | | 2017 2017
Slide 2: Disclaimer
Disclaimer • THIS PRESENTATION (THE “PRESENTATION”) HAS BEEN PRODUCED BY FLEX LNG LTD. ("FLEX LNG" OR "THE COMPANY”), SOLELY FOR PRESENTATION PURPOSES AND DOES NOT PURPORTE TO GIVE A COMPLETE DESCRIPTION OF THE COMPANY, ITS BUSINESS OR ANY OTHER MATTER DESCRIBED HEREIN. • THE PRESENTATION DOES NOT C
Slide 3: Table of contents
Table of contents 01 01 02 About FLEX LNG 02 LNG Shipping Market Outlook 03 03 MEGI Propulsion 04 04 FSRU Market Development Summary 05 05 33 | | 2017 2017
Slide 4: About FLEX LNG
01 01 About FLEX LNG 44 | | 2017 2017
Slide 5: FLEX LNG at a Glance
FLEX LNG at a Glance FLEX LNG: LNG Shipping and Regasification FLEX LNG aims to become a leading supplier of LNG Carriers and Floating Storage & Regasification Units (“FSRUs”) • FLEX LNG is focused on providing safe, reliable, and cost effective solutions in the LNG shipping industry • The Company h
Slide 6: FLEX LNGC Fleet Development
FLEX LNGC Fleet Development Owed Fleet Chartered-in Vessels 6 173,400 173,400 173,400 173,400 4 173,400 170,000 160,000 155,000 174,000 174,000 • 4 chartered-in TFDEs for 6 months firm period (+6 months option) from March 2017; options • 6 LNG MEGI vessels on order declared for two vessels • Under c
Slide 7: FLEX LNG's FSRU Ambitions
FLEX LNG’s FSRU Ambitions FLEX LNG FSRU Strategy Growth of FSRU Regas Capacity by Country FLEX LNG is actively developing several opportunities to mtpa India Chile Bangladesh Puerto Rico Uruguay 100 Brazil Russia Pakistan Turkey Ghana leverage its experience with the development and implementation o
Slide 8: FLEX LNG Fleet Breakdown – Owned and Chartered-In
FLEX LNG Fleet Breakdown – Owned and Chartered-In Status Vessel Name Builder Prop. Built Capacity Head Owner Employment 1. Owned TBN FLEX ENDEAVOUR DSME MEGI 2018 173,400 m3 FLEX LNG Available Jan 2018 2. Owned TBN FLEX ENTERPRISE DSME MEGI 2018 173,400 m3 FLEX LNG Available Feb 2018 3. Owned TBN FL
Slide 9: Functional Organizational Chart of FLEX LNG
Functional Organizational Chart of FLEX LNG A highly experienced team is in charge of LNG shipping LNGC FLEX LNG Strategic Partners Providing technical management and support services Owned Fleet Chartered Fleet Finance & Admin • 160 vessels including LNG, (FLEX LNG) (FLEX LNG) (FLEX LNG) tankers, d
Slide 10: FLEX LNG - Organizational Chart
FLEX LNG - Organizational Chart CEO Jonathan Cook Business Finance/Admin/IR Development Technical Commercial Operations Olav Eikrem Oystein Kalleklev Thomas Thorkildsen Jonathan Cook Technical Director CFO SVP B.D. VP B.D. Comm. Analyst Fleet Manager Head of Newbuilding Fleet Manager SVP Finance Ken
Slide 11: Executive Management Team
Executive Management Team Jonathan Cook (54) – Chief Executive Officer • Previously Chief Marketing Officer for Cardiff LNG, where he managed the LNG commercial activities • Mr. Cook was founding partner of Excelerate Energy from 2003 onwards, Mr. Cook was part of the leadership team that pioneered
Slide 12: Board of Directors
Board of Directors David McManus (64) – Chairman • Mr. McManus has served on the Board since August 2011, and was elected as chairperson in September 2011 • Previously served as Executive Vice President for Pioneer Natural Resources. He is currently serving as non-executive director for a number of
Slide 13: LNG Market Outlook
02 02 LNG Market Outlook 13 || 2017 13 2017
Slide 14: Key Trends in the LNG Shipping Market
Key Trends in the LNG Shipping Market 1 • Over the next 5 years LNG annual supply is projected to rise by atleast 130 mt to ~418 mt in 2021, coming from both new liquefaction plants and existing projects ramping up capacity Natural Gas becoming • IEA predicts global energy demand will increase by 30
Slide 15: LNG Trade to Increase by Over 50% by 2021
LNG Trade to Increase by Over 50% by 2021 Supply by Region, 2011-2021 Mt LNG Middle East Atlantic Asia-Pacific 600 Actual Forecast 500 56% 404 418 373 400 337 11% 297 268 300 242 240 238 240 246 200 100 - 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Demand by Region, 2011-2021 Mt LNG South
Slide 16: Supply Growth Driven by New Exports from U.S. and Australia
Supply Growth Driven by New Exports from U.S. and Australia New LNG Export Capacity Under Construction mtpa mtpa 50 140 Total export capacity 120 40 6 additions of 115+ mtpa by 2020 100 5 30 1 80 6 6 60 20 10 38 17 40 10 14 20 2 6.5 4 - 2 0 2017 2018 2019 2020 United States Australia Russia Malaysia
Slide 17: New LNG Supply Set to Generate Incremental Tonne Miles
New LNG Supply Set to Generate Incremental Tonne Miles Growth in Trade Routes and Tonne Miles Routes (monthly avg.) Y-o-Y growth in tonne miles 250 25% 22% 200 20% 16% 150 15% FSRU Projects: Existing,13% Planned and Proposed 100 10% 7% 5% 50 5% 3% - 0% Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016
Slide 18: When Will LNG Shipping Market Be Short?
When Will LNG Shipping Market Be Short? US$ ‘000/day ST Assessed Spot Charter Rates TFDE Assessed Spot Charter Rates Term Fixtures: Existing Tonnage Term Fixtures: Newbuild Tonnage Uncommitted NB Deliveries 160 140 Only 11 Uncommitted Spot & Term Rates 120 Newbuilds on the Orderbook 100 80 60 40 20
Slide 19: Tightening LNG Shipping Market on the back of New Supply
Tightening LNG Shipping Market on the back of New Supply Overview of incremental LNGC vessel demand and supply through 2020 250 38m tons x 16 200 35 1.3vsl/ton 31m tons x 0.75vsl/ton 49 150 101 63m tons # vessels x 1.7vsl/ton 23 214 100 5 179 35 50 107 57 0 United States Australia Rest of World Vess
Slide 20: Right Ships at the Right Time
Right Ships at the Right Time Only 11 open LNGCs out of 101 through 2021 # Vessels Most of the vessels on the LNGC orderbook are committed to long term charters 50 • Currently, there are 101 LNGC newbuildings under construction 45 • 90% of the LNGC newbuildings built by 2020 are committed for 5 long
Slide 21: FLEX LNG Shipping Strategic Summary
FLEX LNG Shipping Strategic Summary The LNG market is growing rapidly and 30-50 additional vessels are expected to be required by 2020 • New export projects will add 25-30 mtpa of LNG per year over the coming four years • The current orderbook is insufficient to meet this demand for LNGC FLEX LNG is
Slide 22: MEGI Propulsion
03 03 MEGI Propulsion 22 || 2017 22 2017
Slide 23: Trend Towards Modern Vessels is Visible in the Orderbook
Trend Towards Modern Vessels is Visible in the Orderbook LNGC Fleet and Orderbook by Propulsion ST DFDE/TFDE Other XD-F MEGI 50 40 30 20 10 - '75 '91 '07 '72 '73 '74 '76 '77 '78 '79 '80 '81 '82 '83 '84 '85 '86 '87 '88 '89 '90 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '08 '09 '10 '1
Slide 24: A Three Tier Market has Emerged that Favors Modern LNGCs
A Three Tier Market has Emerged that Favors Modern LNGCs LNG brokers began publishing assessed two-stroke (MEGI and X-DF) spot charter rates in Jan 2017 COMPANY Three SNAPSHOT Tier Broker Assessments MEGI Equivalent Spot Charter Rates(1) USD/day USD/day 70,000 70,000 2,000 3,938 60,000 1,212 50,000
Slide 25: Unit Transportation Cost (UTC) Analysis - Critical Trade Route Summary
Unit Transportation Cost (UTC) Analysis - Critical Trade Route Summary Critical Trade Routes Summary U.S. Gulf - Northwest Europe 4,961 nm U.S. Gulf - Far East via Panama 9,279 nm Arabian Gulf - Northwest Europe via Suez 6,377 nm Arabian Gulf – East Asia 5,760 nm UTC Breakdown by Trade Route US$ / m
Slide 26: MEGI Vessels Offer a Substantial Competitive Advantage
…However MEGI Vessels Offer a Substantial Competitive Advantage UTC Equivalent Breakdown of Charter Rates for Dominant Vessel Technologies Over 7 Year Term Gross Charter Rate (US$ ‘000 / day) 100,000 Est. Average Opex 90,000 Rate 80,000 75,000 Est. Average Capex 70,000 69,300 16,600 Rate 60,000 54,5
Slide 27: FSRU Market Development
04 04 FSRU Market Development 27 || 2017 27 2017
Slide 28: What are the Key Benefits of an FSRU?
What are the Key Benefits of an FSRU? Onshore vs. FSRU: Cost Comparison Significantly Reduced Construction Time USD millions 3 mtpa, 180k m3 storage • Both Egyptian FSRUs were implemented in 5 months Component Onshore FSRU from FID to commissioning Terminal (newbuilding) • Construction time for newb
Slide 29: FSRU Gaining Market Share Over Traditional Import Terminals
FSRU Gaining Market Share Over Traditional Import Terminals LNG Imports: FSRUs vs. Land-Based Terminals The FSRU market is poised to grow substantially over the next five Market Share: FSRU vs. Onshore Terminals years • Growth of LNG supply, low LNG prices, energy deficits, security Mtpa of supply i
Slide 30: Up to 34 FSRU Projects Expected Operational by 2020
Up to 34 FSRU Projects Expected Operational by 2020 There are 21 active FSRU projects globally and 13 awarded projects (expected to begin operations in the next 3 years) Existing & Active: 21 Proposed: Awarded: 50+ FLEX LNG team has 13 been involved in 13 of the 21 existing FSRU projects globally Aw
Slide 31: Strategic Partnership with NextDecade
Strategic Partnership with NextDecade FLEX LNG – NextDecade Alliance About NextDecade FLEX LNG and NextDecade signed an HoA in December 2016 to NextDecade is a leading US-based development and managment create a full value chain solution for LNG to international customers company of onshore and floa
Slide 32: Summary
05 05 Summary 32 || 2017 32 2017
Slide 33: Summary
Summary The LNG market could experience significant shortage of tonnage from 2018 FLEX LNG has a modern and efficient fleet of LNGCs available from 2018 offering Charterers significant fuel savings and reduced boil-off rate over older vessels • FLEX LNG has established proven operational capabilitie
Slide 34: Thank You
Thank You October 2017 34 || 2017 34 2017