Excelerate CEO: FSRU conversion in progress and 'we haven't given up on newbuildings' 

Excelerate Energy CEO Steven Kobos has delved into the company’s strategic objectives during the most recent quarterly earnings call.

The CEO said the company is ’preparing to meet the demand of the next wave of LNG growth,’ and discussed the movements of some of its existing assets as well as plans to potentially build a new vessel.

"We’ve had a team in Korea talking extensively and workshopping what a new generation could look like for different markets that we’re thinking about [entering]," Mr Kobos said. "So I don’t want to indicate by virtue of the steps we’re taking with Shenandoah that [vessel conversions are] an exclusive path forward."

US-based Excelerate Energy confirmed it purchased the 2007-built, steam-powered liquefied natural gas carrier Methane Alison Victoria from Greece’s GasLog Partners in July and will be converting the LNG carrier into an FSRU.

Excelerate said, once its conversion is complete, the renamed Excelerate Shenandoah FSRU will be used in conjunction with an Atlantic Basin supply deal. 

"We are advancing plans to convert our existing LNG carrier, Shenandoah, into a floating storage and regasification unit (FSRU). This conversion will expand our fleet’s flexibility and allow us to respond more quickly to emerging opportunities," Mr Kobos said, noting the company’s recent commitment of its newest vessel to a project in Iraq.

In early October, Excelerate Energy received an official award letter from the Government of Iraq to develop an integrated floating liquefied natural gas (LNG) import terminal.

The company said the move by Iraq marked "a significant milestone in the country’s energy diversification strategy". An award letter is a preliminary step, and development of the terminal remains subject to the successful negotiation and execution of binding commercial agreements.

"In October, we executed a definitive agreement with a subsidiary of Iraq’s Ministry of Electricity to develop the country’s first LNG import terminal at the Port of Khor Al Zubair. This agreement builds on extensive engagement with the government of Iraq over the past several years. We’ve worked closely with key stakeholders to shape a reliable solution that addresses the country’s urgent energy needs and supports its long-term infrastructure goals," Mr Kobos said.

The CEO noted that Iraq continues to face chronic power shortages and unreliable gas supply.

"These challenges have led to persistent load shedding and heavy reliance on imported gas from neighboring countries. Our integrated solution offers a fast-track path to energy security," he said.

Under the agreement, Excelerate has agreed to build and operate the floating LNG import terminal that is designed to accommodate up to 500 million standard cubic feet per day of regasification capacity. Excelerate plans to repurpose an existing jetty at Khor Al Zubair port that has been deemed structurally suitable for FSRU operations, and the project includes a five-year agreement for regasification services and LNG supply. 

"The total project investment is expected to be approximately US$450M, inclusive of the cost of the FSRU," Mr Kobos said.

Mr Kobos said Excelerate is estimating to spend around US$200M on the Shenandoah FSRU conversion project.