Delayed by coronavirus outbreak, restricted cash released to Exmar

The coronavirus, also known as Covid-19, has roiled global trade, industrial and financial markets, forcing closures of offices, manufacturing facilities and restricting travel. Prior to the Covid-19 outbreak, Exmar had expected the restricted cash would be released “within the coming days,” according to a 23 January press statement. However, administrative release of the restricted cash could not be resolved until the offices of the Chinese authorities were officially reopened.

The relaxation of the cash collateral follows the steady operational results of Tango FLNG since September 2019. Tango FLNG operates under a 10-year charter with YPF SA and began commercial operations in June. The FLNG has a capacity of 0.5 mta of LNG and is expected to produce about eight cargoes of LNG annually. It exported its third cargo in December.

The US$40M will be partially allocated to repaying the bridge loans from Belfius Bank and Nordea Bank, which assisted Exmar in covering its capital commitments during the interim period. The unexpected delays in the release of the US$40M caused Exmar to “continue to pay careful attention to the liquidity of the company.”

The receipt of this restricted cash together with other anticipated cashflows from charter fees generated by shipping and infrastructure assets will allow Exmar to cover its financial commitments budgeted for 2020.

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