Golar LNG Pan American contract ‘big win’ for shares, says Stifel

Stifel says Golar LNG’s definitive agreements with Pan American Energy for a 20-year deployment of a floating liquefied natural gas vessel in Argentina is a “big win” for the stock. The firm estimates the fixed toll and commodity-linked profit sharing to be greater than $400M. Importantly, the contract has the ability to swap in the Mk II for more than $500M should Hilli receive more lucrative employment elsewhere, the analyst tells investors in a research note. Stifel points out that Golar now has 10% ownership in Southern Energy, a joint venture with Pan American Energy. The firm thinks the news catalyzes an Mk II order, and says “there are likely more contracts to be announced shortly.” Stifel has a Buy rating on Golar LNG.