Good day and welcome to the Quarter One 2016 Golar LNG Limited Earnings Conference Call. Today’s conference is being recorded. At this time, I would like to turn the conference over to Brian Tienzo. Please go ahead, sir.

Thank you and hello everyone. Welcome to Golar LNG's first quarter 2016 quarter results presentation. My name is Brian Tienzo. As usual, I’ll be taking you through the first quarter's highlights as well as the financial highlights. I am joined here today by our new CEO, Oscar Spieler, who will take you through the business update, the summary and outlook section. To start up with, let us turn to page three of the presentation. EBITDA for the quarter is a disappointing loss of $21.7 million compared to 4Q loss of $12 million, as a result of a continuing weak LNG shipping market. More recently and in April -- and sorry in May, we concluded the dropdown of the Golar Tundra to Golar Partners, altogether releasing $100 million during the second quarter. In addition to that, we also concluded the Golar Seal refinancing in Q1. During the quarter, we entered into an MoU with Schlumberger to cooperate globally on the development of greenfield, brownfield and stranded gas reserves using GoFLNG vessels. We now have an ongoing marketing strategy with Schlumberger where literature is available and has been made public. In Q1, Golar Arctic was chartered to New Fortress Energy for two years FSU service for Jamaica. We also appointed our new Director to the Board, Ms. Lori Wheeler, and she will also be the Audit Committee Chairperson, going forward. We executed a framework agreement with ExxonMobil for supply of LNG to Brazilian power projects under development by Golar GenPower. GoFLNG Hilli conversion progresses well and going according to schedule and remains on budget. And as per the press release, it is now one of the main priorities of -- main priority of the Company. We continue the dividend of $0.05 per share for the quarter. Turning over now page four to…

Thank you, Brian. Let’s start on the LNG carriers. But before I start with that, for those who don’t know me, I am not new to Golar. I have been heavily involved in Golar since we brought the Company back in 2001. I was the CEO from 2009 to 2011, and I have since then been heavily involved in all aspects technically and commercially in Golar as Advisor to Board. I have also been very much involved in development of the Hilli, both commercially and technically. So, I am very familiar with the Company. Going over to shipping, which is our main challenge of this Company and the shipping market is with a very low utilization of the world LNG freight, [ph] especially the vessels trading in the spot market. We only achieved 24% utilization in Q1, with rates far below our operating costs. We are hopeful that the start of the different LNG plants like Cheniere, Gorgon and Angola will increase the demand for shipping. We have not seen any newbuilding orders for LNG carriers this year which also will be helping to improve the demand-supply situation. We believe that the freight market will continue to be weak. Golar will mitigate our exposure to LNG carrier markets by converting as many as our LNG carriers as possible into FSRU, which brings to the next slide, page number eight. Golar Tundra is on its way to Ghana. And we have carried out some minor modifications in Singapore to meet the third party requirement. The infrastructure is as far as we know, not ready. However, we will tender notice of readiness very soon as per contract. We have seen that the demand for the FSRUs has increased dramatically over the last year as a function of reduced LNG prices and increased…

[Operator Instructions] We take the first question of Ben Nolan from Stifel. Please go ahead.

I have just two quick ones. Number one, when thinking about projects away from the first two that are already pretty far moved along, and then you guys were hopeful that there might be an opportunity to execute on at least third unit by the end of the decade. And curious, if that timeframe or the number of vessels that you might be able to bring to bear during that time period has changed at all, as things have developed?

As far as we see, there are sufficient [ph] number of market opportunities. I think the restriction with the Company today is more on the financing on off-taker side. But, there are plenty of opportunities in the market. And also with agreement that we’re doing now with Schlumberger or establishing with Schlumberger, we will use that -- that will give us even more opportunities and also enhance our opportunities when it comes to financing and also give some more comfort to the off-takers.

But, sounds like that would probably be -- incremental projects might be after the end of the decade. Is that the fair way to think of it?

The startup might be, but the FID will be taken definitely before the end of the decade.

Ben, I think as Oscar said, there are -- we are looking at variety of opportunities out there. We haven’t made them public simply because we want to make material progress in them before we do. There are certain -- majority of these are very suitable for our generic solution. And whilst there are -- the vast majority will probably start towards the backend of this decade, there maybe one or two that could fit before the end of this decade.

And then switching gears and I’ll turn it over to someone else. You guys sound to be even a little bit more aggressive than you had been on the FSRU conversion side, talking about converting as many vessels as possible. I am curious, I know in the past you’ve said that maybe there would be two to three FSRU projects per year that were coming to the market, and obviously that’s accelerated. But, I was curious if you could put a number on it; what do you think the total market on an annual basis is for new FSRU awards?

If you look at over the last few years, there’s been three to four -- two, three, four; that will most probably improve. Because one of the reasons why we are quite bullish on the FSRU markets is that we have our LNG carrier operating in a very low market. So, it does make very much to improve our returns.

I think it's fair to say that more recent -- the LNG becoming more affordable to almost everyone who wants to bring in LNG has made FSRU space much more interesting. And today, there are very limited number of FSRUs that can become available within a very short period of time. And we can add to that through our previous expertise in converting LNG carriers. We now have a suite of FSRU solutions, whether it’d be a very old steam vessel such as the one that we converted in 2007, or the more modern steam carriers, such as the Golar Winter and of course most recently similar to the Tundra and so on. Those could be also used as a proposal. So, yes, we understand that there are other LNG shipping companies out there whose ambition is the same as ours. But, I think it's fair to say that amongst that group, there’re probably -- or there is only one today who has done that. So, we would hope to be able to use that as a strength to provide a solution.

And just sort of on those lines, I mean, is it fair to think maybe you guys could do two to three conversions a year? I mean, is that too much to…

I will not answer that question directly, but what we are doing is that we are increasing our market activity dramatically; we will put much more people on this simply because we think it’s a very, very prosperous market.

We will now take the next question from Erik Stavseth from Arctic Securities. Please go ahead.

I want to follow up on Ben’s questions on the FSRUs. Firstly, what type of projects are you seeing? Are these projects that are doing a fuel switch and doing the FSRUs out of economics or is it more the energy need and then pain point deals that are done?

It's sort of a mixture really, Erik. We’re seeing various interest coming as of Middle East and North Africa for example. And of course you’ll see -- the Sergipe project is an example of that, which is looking for new thermal power. I think as I said earlier, I think the LNG price, as it is today, has enabled and has made interesting FSRUs much more so. And so those people who are either using other type of commodity for power consumption is now looking at LNG to supplement that. So, we can’t be too specific but I can tell you that it's a variety of uses and requirements that’s giving birth to this interest.

And then in terms of cost and timing, you've indicated before that the costs could be in the range of $60 million to $80 million; correct me if I'm wrong. But, could you just sort of highlight, what the costs and timing would be, if you were to get the project, say by Q3, when could you be up and running, and what would the cost of that be on a conversion basis?

I think your cost estimates are pretty accurate. And on the schedule, we are talking about 15 to 16 months from -- we actually take it by the -- there are different ways of executing this project. We can order long lead items and wait for the conversion. The conversion itself will take -- actually from we take the vessel into the yard until it's completed, will take approximately five to six months. So, there are different ways of doing this.

And then just one final question, Golar Power, could you give us some color on any additional capacity or other projects, whether it’s in other areas or in Brazil that can add to the backlog of Golar Power as a player in the electricity market as well?

We attended the last auction in Brazil, but that from being a quite big auction, it was reduced to a very, very low level. So, there was hardly any power contracts given. We are working on different things, but it is -- I don’t have anything specific to add there. I mean there are -- people need power, not gas actually. So, we're looking into different things but not really hard. We are focusing on executing the strategic projects and to get up in the good position to deliver in 2017.

Thank you. We will now take the next question from Fotis Giannakoulis from Morgan Stanley. Please go ahead.

I want to ask you -- you mentioned about a number of opportunities in the FLNG market, and you referred to the strong endorsement that Schlumberger gave to Golar’s FLNG solution. Given the limited resources that the Company has in terms of capital, how would you think of utilizing these resources? And I'm talking about in relation to the Ophir contract, the Ophir project, vis-à-vis other potential opportunities that they appear with Schlumberger. And if you can also comment on the reference that Kosmos Energy made about your FLNG technology and the potential utilization of this technology for their development?

I will leave the financing to Brian. As I said, there are a number of projects. I don't think I want to go into specifically on the project because we're sitting in discussions with Ophir how to skin this cat going forward. So, I think we will -- we are discussing different types of doing it, whether it's pure tolling free or other types of structures. And when it comes to the FLNG projects, like we see there are two challenges, and it’s in financing in combination with off-taker. And that's what we have to work with. And if the off-taker are in place and the financing, then financing generally becomes comfortable. But, I think I'll leave the word over to Brian on financing.

Thanks, Oscar. I think that's absolutely correct. I think we mentioned in the press release that to some extent the way we would be able to finance projects going forward is going to be dependent on who we have that contract with, the off-taker of LNG from that project and of course ultimately how the economics look like from the agreement that we will have with the counterparty. As far as financing is concerned, going back to the previous Ophir structure, we had gone down a fairly material progression in terms of being able to put something there. And of course, it helps having had the vast majority of the commercial discussions on the project pretty much finalized. Now, we expect to see the same going forward on the projects also. Clearly, it's very -- in the current situation, it's very difficult to do a lot of these projects without much reliance on -- without too much reliance on debt. That is always going to be the case. I think we need to find the right mixture of debt and equity to some extent of the projects going forward. But, I think the way we see it is the economics from those projects that we are in the discussions, is really compelling that in the event that we have one solid project ahead of us, both debt and equity should fall into place. But, as I said, it all is very much dependent on the economics in counterparties we end up having with.

When it comes to the Kosmos deal, which you -- that's a gas project in Mauritania and Senegal where they have very good gas specification, it suits the vessel very well. It's more type of a generic vessel from Golar, with very simple mooring systems. So that's an ideal project, a very good company to work with, and we have lot of the same way forward to work. We are very entrepreneurial. So, Kosmos is a very good partner for us in a project like this.

And, can you clarify how much equity do you anticipate that the FLNG requires? I understand that the Ophir project is not a generic vessel; it requires some additional investment. If all these opportunities, they appear at your disposal, both with Schlumberger or Kosmos and the Ophir, would you have to choose between one or two of them and abandon some other one that is not that attractive? And what kind of commitments do you have towards Ophir, if Ophir decides to go ahead with an FID and at the same time you have the opportunity to get involved in some of the more generic FLNG opportunities?

We can’t really comment too much on Kosmos, Fotis, simply because we haven't made any public, any specific relationship with them. Having said that, when it comes to -- you asked about the equity portion, there isn't a set number, simply because it all very much dependent on the mix of contracts you have in the projects, the economics of the project, and who the counterparties are. I mean, we started off -- on the Perenco, we started with $400 million equity and also in two train vessels. And of course Ophir could be very different with four train vessel. So, I don't think it's fair to just ask for a specific number when it comes to equity. Suffice to say that there is always going to be the right balance between debt and equity depending on which project and counterparties we will have.

I guess one other thing to add is with the six months delay to the Ophir project, that means that the equity component that you need to that project, isn't needed for another six months, which is six months closer to the Hilli becoming cash generative, and of course what we expect to be in the shipping market and in FSRU market as well.

Okay, thank you for that. Oscar, I think that you mentioned earlier about train three of the Hilli FLNG; it can be absorbed without any new investments. Do you have any view on the timing of that and how shall we start thinking about the train four?

No, there are no specific timing on that; there are no detailed discussions on this. But, if all parties have invested the CapEx in order to utilize the train number three, I think everybody's motivated actually to get it in action. But, there are no timing on that and that might be most probably after we have seen the vessel commissioned and accepted by Perenco. But, hopefully, we can surprise you.

And my last question is about your new FSU contract. Because we haven't seen so many FSU deals, can you give us a range of how shall we think about the rate of this project for the return and if there are more FSU opportunities out for even longer periods?

Unfortunately, we can't give an economic specific to that project, because we're under the confidentiality. Suffice to say that the Arctic [ph] from March, mid-March onwards is EBITDA generative.

Is this more similar to the LNG, the pricing of LNG carriers or somewhere between LNG carriers and FSRUs user, or how shall we think about within broader terms? I'm not talking about this particular contract, but I'm talking in general.

Well, LNG carriers today, a very low utilization and Arctic going forward is going to be 100% utilized. So, it's very difficult to draw specific comparison.

And FSRU, if you can use the standard vessel, it would be the shipping market, if you have to do some detailed engineering and convert it, there will be another price.

Thank you. We will now take the next question from Jon Chappell from Evercore ISI. Please go ahead.

Just a couple of quick follow-ups, first on the GenPower; you mentioned the ExxonMobil participation now. And just wondering what’s kind of the last steps before FID can be taken on that project. It seems like most of the pieces are in place. Is it just finalizing terms with the financial partner to kind of help share the burden of the cost or is there another technical issue that needs to be squared away before you can finally move forward with that?

I believe, it's a combination of everything, more or less that is there are still technical work to be done, there are still permits to be given, there are still financing to be completed. So, I think that's the combination of everything. And I think plan to take FIDs is in Q3 this year.

And then you mentioned also in the presentation two likely LNG carrier conversions to FSRUs, was that specifically for this project or is that more on a speculative basis just to pursue some of those other opportunities that you talked about?

I think that more on the speculative -- not necessarily speculative but we will start most probably speculative on order long lead items in second half 2016. And we didn’t think about the GenPower project for those conversions, that will most probably be a newbuild.

Yes, I think don’t forget that whilst we currently have a newbuild delivering next year, which could potentially go to the GMLP [ph] project, that project doesn’t until the backend of 2019, beginning of 2020. So there is a potential for us to use the one that delivers next year as an offering for the various FSRU opportunities that we see today and either convert another carrier for the Sergipe project or the new one for the Sergipe project.

And then, I noticed in the press release some new commentary regarding the Ophir’s -- regarding you guys working together on alternative developments or financing. Can you just explain a little bit more your participation with their kind of negotiating and off-take and how you're working together to potentially help the financing for that?

Well, ultimately I think we all agree that it's a very economic project. So, we and Ophir are very working hard towards making sure that there is -- we give it as much chance as possible. Remember that when we -- when Ophir, I should say, announced the exit of Schlumberger from that project, I think a lot of people saw that a project is very much dead. However, that’s far from the case. We're looking at the variety of structures with them, working alongside and to make sure that both upstream and midstream get the necessary financing needed to take FID in that project and really that the cooperation is going well.

Final one, Brian, on the bond; obviously, you mentioned there is a lot of different alternatives you’re looking at. One thing I just wanted to be clear about though, you mentioned that obviously the GMLP stake is backing that, and if you were to pay down the bond in full, you could use the GMLP stake potentially to arrange other financing. Is the sale of the GMLP stake or part of that GMLP stake, one of the potential arrows in your quiver to pay down the bond or would those have to be separate events?

I think there could be separate events simply because there are certain covenants within Golar that require at the moment to hold certain amount of GMLP. So, the potential is that we use -- once released, there is a potential for us to use those units as security for other types of financing. So, we don't necessarily need to go down and reduce our shareholding of GMLP. There may be some room for us to reduce a little, but ultimately the entire amount could be used as -- to leverage up on security financing -- to alternating financing.

Thank you. And the next question is from Michael Webber from, Wells Fargo. Please go ahead.

Hey, I wanted to start first on the regas business. And I know we have parsed over this a little bit already, but I am just curious as to how those dynamics are changing. If I think about those that have had success in this business, success in the last year or so, it seems as though there has either been a pretty robust shelves involved in terms of assets on the water or that you are seeing players come to the market with consortiums already worked out and almost -- they're coming from the upstream or almost there is a degree of reverse integration that seems to be happening in terms of who is actually able to really grab share in the regas space. So, I guess my question is, one, do you think that's valid? And two, when you think about the growth you see within the regas business, going forward, how much of that do you think is going to come from just traditional tenders versus what you guys are looking at doing with -- in Brazil with Exxon and others?

When it comes to -- I mean, if you look at certain projects in Europe now, you will see that they are just starting to send out request in around Q1 and they want to have the vessel in Q4. So, it seems the developers are able to develop these orders much, much faster due to the fact that some of these companies to get permit is pretty easy; secondly, there are sufficient -- in a few years from now -- historically, it was very, very difficult to get hold of LNG. When we went out marketing, new carriers in the past, the first thing we asked do you have LNG. That's not a question we need to ask anymore. There are sufficient LNG for the developer to grasp. I think when it comes to where it will be tenders or like in Brazil, I think there would be a mixture. We are not product developer, as such, we're more like a toller, where we want to take a tolling for our units to develop project like -- so, it's very demanding. You need to have not only the FSRU, you need pipeline, you need hubs, you need permit et cetera, et cetera. So, I think we will try to go for the keeping simple and try to go for the simple project.

Okay, that's helpful. I wanted to follow up on FLNG and specifically around Ophir. And I know that there's lots of veiled references to the probability of that project going forward in correlation to what you are also looking at elsewhere and the scalability, but I guess if I come at it from the angle that you guys stick with the project, whatever probability assigned to that. Is there an opportunity now to go in and potentially secure a better return than we were looking at previously and have entry multiple into that project was closer to five times EBITDA than the 3, 3.5 we were looking at with Perenco. As we think about -- you can quantify it in either the runrate EBITDA or the return or the entry multiple, whatever mechanism you'd like to quantify it in and is there an opportunity to increase their potential return there just given the leverage you have at this point?

I think it'll be a bit wrong of us to start to comment on that because we’re not sitting discussing these things with Ophir. So, I’d rather just say pass on this.

I guess sticking with FLNG and the collateral you guys have in place for the Hilli, Brian, I guess can you remind us the timing and I guess the magnitude of that Perenco collateral is released? If my memory serves, I think it goes beyond kind of delivery of the assets. So, I guess, it would be that restricted cash and how that actually impacts your liquidity, how does that get released over the life of the contract?

That's correct, Mike. So, I mean there is currently $280 million sitting in a collateral account, which is used to secure the guarantee to the Cameroon project. Now, of that, we are in discussions with the banks to try and release some of that. And to some extent, there is a possibility of being able to do that simply because it is somehow dependent -- it's not somehow, but it’s dependent also on the ability to be able to syndicate some of the bank's exposure in that. Having said that, you rightly say that there comes a point in time when the value of the guarantee that we are giving to the Cameroon project, comes down. And it's actually -- and that the trigger there is that one year from the startup of the Hilli, the guarantee reduces from $400 million to $250 million. And on $400 million, there is a sort of -- the collateral is 280. So, obviously, once you get down to $250 million, then the collateral would come down. And actually, it reduces by approximately $180 million or so. And then from there onwards, it's the 250 required, another year from there, it reduces again to $100 million. And so by 2019 or so, mid-2019, then the cash collateral would drop to approximately $40 million. So, there is cash to come by but unfortunately it's just frustrating. It's taken a while to free up some that should be -- hopefully we’ll be able to free up. But, in any event, there is a trigger ahead of us that will require a reduced cash collateral anyway.

Got you. Okay, that's helpful. And I can follow up on the details on that offline. But, just to stick with liquidity for a second, in terms of threads to pull in the story here, forward liquidity is generally the biggest ongoing topic. And if I think about the potential capital calls for Golar in the next several quarters, especially as we get into 2017, then you get the convert to handle potential capital calls from the Ophir project and then the scalability and the size of the capital calls for anything else you do in West Africa, it seems to be a pretty big variable as well. So, I guess, Brian, the question is, one, how do you prioritize your liquidity as it pertains to the option value or the scalability you get out of a new project versus what you are looking at with Ophir? And, if you can't swing it, which I would understand, I guess do you think you have the wherewithal from a liquidity perspective to do all three to handle that convert in cash if need be to handle Ophir's liquidity or the capital calls on Ophir and be able to step into say a multi-asset project with a 2020 startup date with another large player?

I think clearly the level of -- the share price level where we are today makes that -- all of that very difficult. I think given the maturity of the convertible bond coming in March 2017, we've pointed towards the availability or the release of the MLP units that is married to that bond. So, there is a potential for us to be able to use that to repay the bond in its entirety. So that's one. And then when it comes to other projects, whether it's the Ophir or the FLNG projects, I think the crucial thing there is getting the right economics out of the projects. And I think to some extent, we have seen this recently with our discussions to financing Gandria under the previous structure with Ophir, where it really mattered is who the counterparties are, who is involved in there, and also how much of the LNG is a firm offtake. Because essentially the lenders will want to see how much cash flow is coming from the project that could be pointed out to service the debt and then you almost work backward to try and see of that cash flow how much could you afford or how much could the lenders afford to lend you and still be comfortable that they’ll get the debt service. But clearly there needs to be a good balance between debt and equity. And as I said, I think to some extent, we are limited in what we can do today in terms of other projects until such time is all of those factors are much more clear to us.

Thank you. We will now take the next question from Herman Hildan from Clarksons Platou. Please go ahead.

My first question, in the report, you say that you expect to make a final decision within the next three months in terms of your participation on the Fortuna project and forgive that FID on Fortuna is Q4. I am just wondering how you can conclude in your participation before knowing whether there will be an FID taken or not?

One of the successes of this Company going forward is actually to pick the projects which are real and not real. So, I think we only need three months to make sure that this project is a project which we would go forward with. That said, we need another three months to actually take FID to prepare all the final documents et cetera, et cetera, which is all very well progressed.

So, there is no reading into that -- and just finally on the or next on the startup with the Fortuna in 2020 now pushed out from 2019. The question is, do you still believe the Fortuna will be your second FLNG or are you aiming to kind of potentially get a vessel before the Fortuna, given that you have a three-year window between the Hilli and the Fortuna potentially?

It's not unlikely, I would say. We’re working on different projects, but for the moment, I would say, Fortuna is number two but it's not unlikely that there could be some other projects which are very shallow water, benign, very good gas quality, which we are looking at for the moment.

And just to understand the timing within what time frame would you need to tie down new project to have a delivery between the Hilli and Fortuna potentially?

I would say, it depends on a lot of factors. And as I said before, financing and offtake would be crucial to take an FID. And what we’ve seen is that that take pretty long time. And then you have the negotiation between the upstream and the off-takers et cetera et cetera. So, it has to happen within the next six-seven months.

And then just finally, you've refinanced as far as I can see one out of the six LNG carriers that you indicated you would refinance and generate, I think $280 million to $320 million of liquidity. Could you give us an update on the time frame you expect to finance all six or if something has changed with that?

Well, I think it's fair to say that the continuing challenging shipping market has delayed the refinancing and to some extent some of the people -- some of the banks that we are talking to, requiring to see what happens in the shipping market initially; having said that, we are in discussions with various financing institutions. So, we’re not ditching that. It is something that we’re working in the background. But, given the less predictable timing of any of this refinancing, we would prefer to just go ahead and do it rather than as previously done, plaster it all over our announcements.

And then, just actually one final question on the contingency; in the past, you have guided on how much of the contingency that you have used. Is it possible to say anything with respect to the contingency on the Hilli; how much you've utilized of that?

I don’t know exactly what we said during last quarter, but what I can say is that there is no change.

Thank you very much.

Before we carry on, administrator, would you mind just limiting remain -- because we’ve got quite a good queue ahead of us. We’ve got limiting remaining questions, so either one question one follow-up, or just two questions please.

Thank you. We will now take the next question from Ken Hoexter from Merrill Lynch. Please go ahead.

Just if you could follow up a little bit on the Schlumberger commentary; you mentioned it doesn't -- your agreement with them is different than the Ophir, but maybe delve into that a little bit. Because the timing was odd in terms of your moving forward with the Schlumberger teaming up while they were stepping aside from the Ophir; is there a reason for their moving aside while you were pressing forward with the agreement with Schlumberger?

I don't think we are fully privileged to that information from Schlumberger. That was a decision taken by Schlumberger themselves. The discussions we are having with Schlumberger is progressing as planned without [indiscernible]. So, I'm not really sure what -- what we've heard is that they really have no comments to the gas field and the gas reserves, as such. What they’ve said this is more like that this is a world class gas field.

And then I guess -- Oscar, congratulations on your taking over again or returning to the Company. But, with Gary stepping aside, what was that led to the changes? I mean this is quick turnover at upper management. So, maybe a little bit of perception issues here on what's going on. Is this to do with the strategy shift from the FLNG rollout to more an FSRU focus? Is it Golar Power; what led to the relatively quick turnover in management? And it seems like -- I don't want to call it a revolving door, but it seems like all the current CEOs have been former CEOs of Golar as well. Is it a constant switching to sticking with prior management versus a need to promote from within, go to the outside or maybe talk a little about why that quick changeover?

So, just make one thing clear. Gary, he resigned and wanted to pursue other opportunities. And I just want to thank him for the job he did and hard work during his time. So, he actually resigned and that role. Then, the Board came to me and I asked me to takeover. And after considering it, I found that most probably this is best solution both for the shareholders and for the employees, based on my background in the Company as the CEO, developing the Hilli project, have employed most of the people in organization etcetera, etcetera. So, that's the reason behind it and the reason why chose me, one thing is that I'm sitting in Oslo where a lot of activity is going on. There are 85 to 90 people in Oslo, lot of the development is going on there, and the step going forward is apart from finance and the commercial access, there have been lots of FLNG projects concept or really the Mark 1 and Mark 2; but actually Gary, he resigned. That's the end of the story.

So, not because of -- if I may guess, the simplicity, say it’s a shift from the FLNG focus to an FSRU focus, as you’ve discussed earlier, it's just that they're separate issues or…

Not at all; I don't think it has anything to do with each other. Gary decided to resign and the reasons

Okay. And then on your financing, just the last one; sorry, real quick question, but on the Gandria, I just wanted to confirm what you were saying before is that there is no moving forward with the Gandria until you have firm commitments in place. I guess that was the Michael's question. Could you do something in 2020 or what you are saying is nothing moves forward on that FLNG prospect until that, the bigger focus in the near term is back to the FSRUs?

No, I think specifically on the Gandria, Ken, I think what we are saying there is there needs to be a few moving parts that need to come together. And of course, one of the biggest parts is the financing. And to some extent the project cannot take FID until such thing as that is put into place or commitment for that is available. And having said that though, to some -- that is also dependent on the other parts of the project, namely the off-take and the counterparties to be involved in project, but we're not saying that -- we are pursuing FSRUs and we're ditching the activities we have on FLNG, those who can coexist simultaneously next to each other and that's exactly what is happening in the organization today.

Thank you. [Operator Instructions] We will now take the next question from Chris Wetherbee from Citi. Please go ahead.

I wanted to ask you about the Hilli, and just one of the comments you made about the commissioning in Singapore onsite and how that might potentially play into the progress of the FLNG coming to market. Just want to get a sense or maybe some clarification on any issues that we might think about in terms of timing to get on the project and potentially move forward?

Of course, we will do whatever we can in order to deliver this vessel as early as possible. And I think the most efficient way is to do as much testing in Singapore as possible. If we do testing in Cameroon and we find some issues, it will take much longer time to rectify it. That's the only thing what as I said. So, that's the reason for this. And we have actually been thinking about this all the time. It means that we will have bit later departure from Singapore but overall schedule will be less -- that's the purpose of that exercise.

So, you could actually end up maybe shaving some time off of it in the grand scheme of things by doing this in Singapore?

Well, we are definitely going to -- we will be more short with the deliveries on the time if we do things in Singapore, I would say.

And my one follow-up would just be very technically on administrative expense, thinking about the model. I understand from a project expense basis the ramp up we've seen though, but should we expect this level to continue to ramp up or do we flatten out sort of at roughly 1Q levels? I'm just thinking about it because obviously every dollar counts, as we think forward here. How do we think about that number?

I think there has been a lot of ramping up with the past year or so, I would say, Chris, simply because of the number of people we're putting in to develop FLNG and also to some extent help out with -- it is now most of the development of FSRUs. They will come a point where it will be stable but there is a possibility of that going up again in the event and second FLNG is kicked off.

Thank you. We will now take the next question from Eirik Haavaldsen from Pareto Securities. Please go ahead.

Hi, just one question on Cameroon because you sound very confident in Q4 ‘17 startup for Hilli. Can you -- I mean you give good color on your progress, but can you give any comment on where Perenco stands at the moment, and whether they have a lot of finishing work and drilling to make, or what remains to be done there on their end?

Perenco is on schedule, maybe a bit in front. They have started to put down the pipelines; they have ordered all the long lead items. They haven't received the long lead items. So that's always a challenge, if something happens. But, the feedback we get from them is that there will be on time.

Thank you. We will now take the next question from Espen Landmark from Fearnley. Please go ahead.

Just wondering on the shipping market being as poor as it is, what would it actually take for you guys to consider laying up some of the more modern vessels as you've done on the Golar Grand and the Viking?

When it comes to the laying off vessels, there is a lot of things to consider. It's a period is one thing because there a lot of mobilization and demobilization costs to lay up a ship, you have the trouble of getting people sacked, and then you have to employ them again. So, it is a calculation on one year and two year and three year, and even if you actually save a few thousand dollars, it might not be worth, if you think that the cash breakeven is not the cash breakeven but the breakeven on those vessels are $56,000 [ph] and you save a few thousand dollars, it's not worth it for the moment. If the market goes down below $7,000 a day, I think we'll start to consider it maybe, but if it is only for a year, we will still continue; if it's for two years, if the market will not improve for the next two years, we will maybe consider it. But it’s a lot of different factors. And not only normally but it's also the fact that you lose vesting, you have uncertainty when you start off the vessel with all the electronics et cetera, et cetera, electronic and instrumentation and so forth. So, there is a lot of things to consider and we've done quite a lot of work there and we found that not to do it at a present market and especially not with -- hopefully that we will see some improvement of the market. So that's where we are. When it comes to -- there is a big difference between modern and steam vessels because the steam vessels, when you need to have fire on the boiler, which consumes much more fuel than modern vessels.

And maybe Brian, if you can comment on kind of the equity portion for a potential FLNG number too; I mean, is there a better options now that that number will be lower than on Hilli?

We can't really comment on that for the time being, Espen, simply because there are few things that we need to put together. We had been aiming for something below Hilli and we will continue to aim for something below Hilli, whether or not we can achieve that, to some extent, it's going to be dependent on who eventually will be the counterparties, the economics of the project and so on. We may -- as I said earlier, we made some good progress on that in the previous structure but obviously, we're now working with Ophir to try and make sure that both theirs and our financing needs are met under the current, in the new structure.

Thank you. We will now take the last question from Andy Gupta from HITE Hedge. Please go ahead.

Two questions from me. One is there was some talk around heads terms on third project expected around summer. Are you still seeing those discussions progress where the timing would be the summer?

We are in discussion with certain people. I am doubtful that that will happen before the summer or during the summer. I think it will be at least further out.

Do you expect it in 2016 or after?

As we see it today -- but it's very early days, and we need to -- I can't really promise you anything there, but we're in discussions with them every day.

And then my last question here is you mentioned in the press release and on the call equity being challenged and the equity needing to improve to finance these growth projects, are you referring to GLNG and/or GMLP; how are you thinking about this? And also, when I look at GMLP, it seems GMLP at least has capacity to do dropdowns at just debt and not needing to share equity, which could be cash flow positive to yourselves.

I hope we understand you correctly, Andy, there is a very loud echo when you were talking, but I think when it comes to the equity being challenged, and so very certainly the case, and I think it -- the answer really was trying to get to a point where in the current situation, if we're asked to do multiple projects and equity, Golar share price doesn't improve sufficiently, then it becomes challenging. There is always going to be certain amount of cash required as an equity portion of each of the projects and the level of that is very much dependent on a few factors. So that was really the main point that we were making. We weren't really alluding towards the MLP’s equity but certainly what it does make it challenging though is obviously being able to dropdown vessels at the MLP, if the share price of the MLP doesn't change or improve also. Having said that, over the past three to four months or so, I think you'd agree the MLP share price have recovered -- improved markedly. It has -- depending on the EBITDA of the MLP, the MLP’s buying, there is obviously debt some extenders, there is debt capacity there. But, the dropdown is still a consideration for us, but I think that we need some improvement on both equities to make it the much better accretive.

That will conclude today's Q&A session. I would now like to turn the call back to the host for any additional or closing remarks.

Hello, it's Oscar. Thank you very much for all your questions. Hopefully, you're happy with it. We will be back in Q2 hopefully with better results and good news. Thank you.

That will conclude today's conference call. Thank you for your participation. Ladies and gentlemen, you may now disconnect.