Karl Fredrik Staubo: Yeah. Hi, Matt. So the transit is expected to take around 60 days from today, so we’re looking, call it, late December, early Jan. There is possible to do it quicker, it’s really subject to weather going around the Cape, which is the key sensitivity, but 60 days includes for weather window. Then subject to the project being available to send those gas, we would then hook up and start gas flowing into the FLNG as we are on-site and we would then take up to six months for commissioning. And as just explained in Greg’s earlier question, we would then make a commissioning fixed day rate plus a tolling fee based on actual liquefaction concluded in the commissioning period. And again, we’re working with the GTA partners to shorten that time frame.
In the event that the project is not available to send those gas, there is another contracting mechanism that then kicks in, which is effectively a standby day rate, but we are paid to be on site until the project is available to send those gas and commissioning starting up. The standby day rate is a staircase that starts off relatively low, covering OpEx and a little bit more, and then increasing as the potential time of being on standby day rate and extends, but our and the GTA partner’s clear ambition is to get gas flowing and get to commercial operations date as soon as possible.
Unidentified Analyst: Great. Really appreciate that detail. That is very helpful. And then just as a follow-up, could you just touch a little bit more on sort of the further contracting or I should say, re-contracting opportunities for Hilli. I know that I can see a — now 2024 potential commitment on the horizon, which appears to be a development since last quarter. Just any details there just to fully understand the situation and the likelihood of the commitment fully materializes.
Karl Fredrik Staubo: Yeah, there’s always a trade-off between what we think industrially maximizes the return on the assets and what the financial markets want in terms of visibility and we’re trying to balance the two, but at the end of the day, this is the only FLNG available for gas monetization at end of 2026, early 2027, and we think that the commercial value of that is very attractive and that’s further confirmed by the commercial discussions we’re in. As we alluded to, we are in detailed commercial discussions with three opportunities and there are several other gas resource owners doing technical work on the feasibility of FLNG monetization of their resources. Once we reach commercial agreement, which frankly is not the most challenging part of an FLNG commercial transaction, we then need to get together with the upstream partner, all of the regulatory approvals that’s needed.
So subject to geography that is anything to do from PSC terms, fiscal regime, environmental sign off, confirmation of mooring location, and these, call it, steps that’s required for FID. So commercially, we think we will have line of sight significantly earlier than when we would formally have a firm commitment. So we are now actively working to finalize commercial terms and to develop a clear timeline together with the upstream partner and the local regulators on where the ship would work, and for now, we see the competitive tension on the interest on the vessels working in our favour and that’s what we’re trying to balance together with the financial markets anxiety or sort of need or want to see clarity on re-contracting.
Unidentified Analyst: Very helpful. Really appreciate the detail. I’ll turn it over on that.
Operator: Thank you. [Operator Instructions] We’ll now move on to our next question. Our next question comes from the line of Craig Shere from Tuohy Brothers. Please go ahead.
Craig Shere: Good morning, New York Time. So congratulations on all the progress. A clarification on the answer to Ben’s question on the Gimi refi, it sounded like your operating cash flow is intended for return of capital to shareholders but one-time, you know, asset sales or cash outs like Gimi reify are intended for future growth investment. So my question is, how much do you expect to be needed for a Mark III FID in terms of cash-on-hand and if you have notably more liquidity after Gimi refi, would you see that merely helping bridge a Hilli redeployment period or are you already eyeing something beyond the Fuji conversion?
Eduardo Maranhao: Okay. So the way we see it is, operating cash flow can be returned to shareholders through a combination of buybacks and dividends. At the moment, we think the cash at hand can be used for Hilli redeployment, FID of Mark II, and subject to the timing of which potentially further FLNGs beyond that. In terms of the money required for a Mark II, we think that CapEx would be plus-minus $2 billion. We think that debt available in the construction period should be anywhere between, call it, plus-minus $1 billion to $1.2 billion, so we are estimated around 800. Given that we’re currently also retaining some of the operating cash flow, we think we have ample liquidity to deal with an FLNG FID, the redeployment of Hilli, and then some.
If and when we do asset disposals, it will be up to the Board on how that capital is allocated, but mainly our thinking is operating cash flow should be a sustainable dividend and then other cash should be used for attractive growth projects.
Craig Shere: Got it. And once you re-contract, you know, for redeployment of the Hilli, I guess maybe to start up at a new location, possibly at the beginning of 2027, are you in a position that it’s dramatically more attractive and some higher locked-in cash flows with some upside kickers, are you in a position to do refi on that as well and cash out?
