Golar LNG (GLNG) - 2025 Q2 - Quarterly Report

FORM 6-K Filing Information Filing Details This Form 6-K report from Golar LNG Limited includes an overview, operating and financial review, and unaudited consolidated condensed financial statements for the six months ended June 30, 2025 - The report covers the Overview, Operating and Financial Review, and unaudited consolidated condensed financial statements for the six months ended June 30, 2025[3] - The information in this Form 6-K is incorporated by reference into the Company's registration statement on Form F-3 ASR (File No. 333-271027)[4] Signatures The report was duly signed on August 15, 2025, by Eduardo Maranhão, Principal Financial Officer of Golar LNG Limited, in accordance with the Securities Exchange Act of 1934 - The report was signed by Eduardo Maranhão, Principal Financial Officer, on August 15, 2025[8] Forward-Looking Statements Safe Harbor Statement Golar LNG Limited includes a cautionary statement regarding forward-looking statements, aiming to leverage the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements reflect current views on future events and financial performance, but are subject to significant uncertainties and contingencies beyond the company's control - Golar LNG Limited utilizes the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 for forward-looking statements[11] - Forward-looking statements are based on assumptions that are inherently subject to significant uncertainties and contingencies, and actual results may differ materially[12] Risk Factors Key factors that could cause actual results to differ materially from forward-looking statements include the ability to fulfill commercial agreements (FLNG Hilli, FLNG Gimi, MKII FLNG), secure additional financing, and navigate global economic trends, geopolitical risks, and regulatory changes. Operational challenges, counterparty compliance, and increased operating costs also pose significant risks - Ability to fulfill obligations under commercial agreements for FLNG Hilli, FLNG Gimi, and MKII FLNG, including redeployment activities and counterparty commitments[13] - Risks include obtaining additional financing, global economic trends, competition, geopolitical risks (e.g., U.S.-China tensions, Russia-Ukraine, Middle East instability), and increased tax liabilities[13] - Operational risks such as decline in tolling rates, shipyard failures, counterparty non-compliance, and changes in FLNG-applicable rules and regulations[13][16] Management's Discussion and Analysis of Financial Condition and Results of Operations Overview and Strategy Golar LNG's strategy focuses on market-leading FLNG operations and leveraging balance sheet flexibility to maximize shareholder returns through accretive FLNG projects. The company aims to provide gas resource holders with proven, quick, and low-cost solutions for monetizing stranded gas reserves, emphasizing its operational track record and growth prospects - Golar's strategy is to provide market-leading FLNG operations and maximize shareholder returns through accretive FLNG projects[18] - The company offers gas resource holders a proven, quick, and low-cost solution to monetize stranded gas reserves[18] Recent and Other Developments Recent developments include the mutual termination of the LNG Hrvatska O&M agreement by October 31, 2025, and SESA reaching Final Investment Decision (FID) for the 20-year charter of the MKII FLNG, expected to commence operations in 2028 with a fixed annual charter hire of $400 million plus a commodity-linked tariff. Golar also declared a dividend of $0.25 per share for Q2 2025 and appointed Mr. Stephen J. Schaefer to its Board of Directors, alongside changes to Audit, Compensation, and Nomination Committee appointments - LNG Hrvatska O&M agreement for FSRU LNG Croatia mutually terminated in July 2025, with operations ceasing by October 31, 2025[20] - SESA reached FID on August 6, 2025, for the 20-year charter of the 3.5 mtpa MKII FLNG, with commercial operations expected to commence in 2028[20] MKII FLNG Charter Terms | Term | Detail | | :--- | :--- | | Fixed Annual Charter Hire | $400 million | | Commodity-Linked Tariff | 25% of FOB prices above $8.00 per million BTUs | - A dividend of $0.25 per share was declared on August 14, 2025, for the three months ended June 30, 2025[21] - Mr. Stephen J. Schaefer was appointed to the Board of Directors effective August 1, 2025, and committee appointments were revised effective May 20, 2025[22][26] Operating and Financial Review (Consolidated) Golar LNG exited shipping operations in Q1 2025 with the sale of Golar Arctic and conversion of Fuji LNG, reclassifying shipping activities to the Corporate and other segment. FLNG Gimi achieved Commercial Operations Date (COD) in June 2025, commencing its 20-year lease term and resulting in a $30 million gain on deemed sale. Consolidated Adjusted EBITDA decreased by $34.1 million YoY, primarily due to reduced realized gains on oil and gas derivative instruments and increased project development and administrative expenses, partially offset by higher operating revenues from FLNG Gimi - Golar exited shipping operations in Q1 2025, with Fuji LNG entering conversion and Golar Arctic sold. Shipping is no longer a reportable segment[24] - FLNG Gimi achieved Commercial Operations Date (COD) in June 2025, commencing its 20-year lease term and recognizing a $30 million gain on deemed sale[25] Adjusted EBITDA (Six months ended June 30) | (in thousands of $) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Adjusted EBITDA | 90,191 | 122,303 | (32,112) | | Net income | 43,718 | 101,725 | (58,007) | - The decrease in Adjusted EBITDA was primarily due to a $33.1 million reduction in realized gains on oil and gas derivative instruments (TTF swaps maturity) and increased project development and administrative expenses[36] - The decrease was partially offset by an $8.5 million increase in total operating revenues, mainly from FLNG Gimi's LOA commencement[36] Adjusted EBITDA Reconciliation Consolidated Net Income to Adjusted EBITDA Reconciliation (Six months ended June 30) | (in thousands of $) | 2025 | 2024 | | :--- | :--- | :--- | | Net income | 43,718 | 101,725 | | Income tax | 618 | 278 | | Income before income tax | 44,336 | 102,003 | | Depreciation and amortization | 24,844 | 26,256 | | Unrealized loss on oil and gas derivative instruments | 59,817 | 13,902 | | Other non-operating income | (29,981) | — | | Interest income | (14,522) | (18,582) | | Loss/(gain) on derivative instruments, net | 10,638 | (6,309) | | Other financial items, net | 3,265 | 2,694 | | Net (income)/loss from equity method investments | (10,287) | 2,339 | | Sales-type lease receivable in excess of interest income | 2,081 | — | | Adjusted EBITDA | 90,191 | 122,303 | Depreciation and Amortization - Depreciation and amortization decreased by $1.4 million for the six months ended June 30, 2025, primarily due to the cessation of depreciation for Fuji LNG (conversion) and the disposal of Golar Arctic[28] Unrealized Loss on Oil and Gas Derivative Instruments Unrealized Loss on Oil and Gas Derivative Instruments (Six months ended June 30) | (in thousands of $) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Unrealized (loss)/gain on FLNG Hilli's oil derivative instrument | (39,450) | 15,092 | (54,542) | | Unrealized loss on FLNG Hilli's gas derivative instrument | (20,367) | (5,294) | (15,073) | | Unrealized MTM adjustment on commodity swap derivatives | — | (23,700) | 23,700 | | Total Unrealized loss | (59,817) | (13,902) | (45,915) | - The increase in unrealized loss on FLNG Hilli's oil derivative instrument ($54.5 million) and gas derivative instrument ($15.1 million) was driven by a reduction in the remaining LTA term and volatility in future Brent and TTF price curves[29] - The decrease in unrealized MTM loss on commodity swap derivatives ($23.7 million) was due to the maturity of TTF swaps on December 31, 2024, with no new swaps entered[30] Other Non-Operating Income, Net - Other non-operating income reflects a day 1 gain from the derecognition of the FLNG Gimi asset under development ($1,823.7 million) and recognition of a net investment in sales-type lease ($1,767.5 million) on COD, resulting in a $30 million gain[30] Interest Income - Interest income decreased by $4.1 million, primarily due to reduced short-term money-market deposits, partially offset by higher bank account balances and interest from a shareholder loan to FFH[31][34] (Loss)/Gain on Derivative Instruments, Net (Loss)/Gain on Derivative Instruments, Net (Six months ended June 30) | (in thousands of $) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Unrealized MTM adjustment for IRS derivatives | (11,611) | 1,754 | (13,365) | | Net interest income on undesignated IRS derivatives | 973 | 4,555 | (3,582) | | (Losses)/gains on derivative instruments, net | (10,638) | 6,309 | (16,947) | - The $13.4 million increase in unrealized MTM loss on IRS derivatives was driven by lower notional values of the swap portfolio[35] - Net interest income on undesignated IRS derivatives decreased by $3.6 million due to movements in the Secured Overnight Financing Rate (SOFR)[35] Net (Income)/Loss from Equity Method Investments - Net income from equity method investments increased by $12.6 million, primarily due to a gain on disposal of the shareholding in Avenir[32] Sales-type Lease Receivable in Excess of Interest Income - This represents the principal amortization component of total invoiced amounts under the FLNG Gimi sales-type lease, included in FLNG Adjusted EBITDA to reflect total cash earnings and economic performance[33] Segment Information Golar LNG now operates in two reportable segments: FLNG and Corporate and other, following the exit from shipping operations in Q1 2025. The FLNG segment's Adjusted EBITDA decreased due to lower realized gains on derivatives, despite new revenue from FLNG Gimi. The Corporate and other segment saw increased vessel management fees but decreased time and voyage charter revenues due to vessel disposals and conversions, alongside higher administrative and project development expenses - Golar LNG now has two reportable segments: FLNG (operations of FLNG Hilli, FLNG Gimi, and other FLNG projects) and Corporate and other (legacy shipping, vessel management, FSRU services, corporate overhead, and strategic investments)[24][107][108] Total Operating Revenues by Segment (Six months ended June 30) | (in thousands of $) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | FLNG | 124,800 | 112,488 | 12,312 | | Corporate and other | 13,375 | 17,160 | (3,785) | | Total Operating Revenues | 138,175 | 129,648 | 8,527 | Adjusted EBITDA by Segment (Six months ended June 30) | (in thousands of $) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | FLNG | 111,910 | 138,654 | (26,744) | | Corporate and other | (21,719) | (16,351) | (5,368) | | Total Adjusted EBITDA | 90,191 | 122,303 | (32,112) | FLNG Segment The FLNG segment's total operating revenues increased by $12.3 million, driven by the commencement of FLNG Gimi's sales-type lease revenue and vessel management fees. However, Adjusted EBITDA decreased by $26.7 million due to a $33.1 million reduction in realized gains on oil and gas derivative instruments (TTF swaps maturity) and increased project development expenses, partially offset by FLNG Gimi's revenue contribution FLNG Segment Operating Revenues (Six months ended June 30) | (in thousands of $) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Liquefaction services revenue | 112,200 | 112,488 | (288) | | Sales-type lease revenue | 8,219 | — | 8,219 | | Vessel management fees and other revenues | 4,381 | — | 4,381 | | Total operating revenues | 124,800 | 112,488 | 12,312 | FLNG Segment Key Expenses and Gains (Six months ended June 30) | (in thousands of $) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Realized gain on oil and gas derivative instruments, net | 37,447 | 70,537 | (33,090) | | Vessel operating expenses | (45,257) | (41,549) | (3,708) | | Project development expenses | (6,513) | (2,385) | (4,128) | - FLNG Gimi's sales-type lease revenue reflects interest income on the net investment and variable lease revenue from operations since June 2025[40][41] - Realized gain on FLNG Hilli's oil derivative instrument decreased by $15.4 million due to lower average oil prices, while the gas derivative instrument gain increased by $7.0 million due to higher TTF prices, partially offset by a weaker Euro[44] - Vessel operating expenses increased by $3.7 million, mainly due to FLNG Gimi's commissioning and operational expenses, partially offset by reduced FLNG Hilli operating expenses[43][45] - Project development expenses increased by $4.1 million, driven by higher costs for FLNG contracting opportunities in Argentina, FLNG Hilli redeployment, and a Mark III FLNG FEED study[44][45] Corporate and Other Segment The Corporate and other segment's total operating revenues decreased by $3.8 million, primarily due to a $5.5 million reduction in time and voyage charter revenues from the Golar Arctic sale and Fuji LNG conversion. Vessel management fees increased by $1.7 million. Adjusted EBITDA for this segment decreased by $5.4 million, impacted by higher administrative expenses (employee compensation and stock costs) and a $1.6 million other operating loss from a credit loss allowance and Golar Arctic disposal Corporate and Other Segment Operating Revenues (Six months ended June 30) | (in thousands of $) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Vessel management fees and other revenues | 12,499 | 10,830 | 1,669 | | Time and voyage charter revenues | 876 | 6,330 | (5,454) | | Total operating revenues | 13,375 | 17,160 | (3,785) | - Time and voyage charter revenues decreased by $5.5 million due to reduced activity from Golar Arctic (sold) and Fuji LNG (conversion)[48] - Vessel operating expenses decreased by $3.6 million due to reduced operational activity for Fuji LNG and the disposal of Golar Arctic[49] - Administrative expenses increased by $2.9 million, driven by a $2.8 million increase in employee compensation and benefits and a $1.3 million increase in employee stock compensation costs[49][50] - Other operating loss of $1.6 million was due to a $1.1 million credit loss allowance on the Higas shareholder loan and a $0.5 million loss on disposal of the Golar Arctic[49] Liquidity and Capital Resources Golar LNG's short-term liquidity needs are for debt servicing, working capital, and FLNG project expenditures. The company believes existing cash, operations cash flow, and planned liquidity initiatives will cover needs for the next 12 months. As of June 30, 2025, cash and equivalents totaled $907.3 million, with $123.9 million restricted. The company is exploring debt optimization and new corporate debt/refinancing, with a contingency plan to terminate the MKII FLNG conversion if liquidity initiatives fail. Net cash from operating activities increased significantly, while investing activities saw increased outflows for FLNG conversion projects, and financing activities were boosted by convertible bond issuance - Short-term liquidity requirements are primarily for debt servicing, working capital, FLNG modification, redeployment, and conversion projects[51] - As of June 30, 2025, cash and cash equivalents (including short-term deposits) were $907.3 million, with $123.9 million restricted[52] - The company is exploring debt optimization, new corporate debt issuance, and refinancing existing debts to meet capital commitments, with a contingency plan to terminate the MKII FLNG conversion project if necessary[89][90] Liquidity Overview - Golar believes existing cash, cash flow from operations, and planned liquidity-enhancing initiatives will be sufficient for the next 12 months[51] Cash and Restricted Cash (as of June 30, 2025) | Category | Amount (in thousands of $) | | :--- | :--- | | Cash and cash equivalents | 783,427 | | Restricted cash and short-term deposits | 109,824 | | Restricted cash (non-current portion) | 14,050 | | Total | 907,301 | - Restricted cash includes $93.4 million pre-COD earnings from Gimi, $16.5 million cash from a lessor VIE, and $13.0 million for the LNG Hrvatska O&M Agreement[52] Borrowing Activities - In March 2025, Golar entered a $1.2 billion sale and leaseback agreement to refinance FLNG Gimi debt, pending third-party approval, while also exploring alternative financing options[54] - As of June 30, 2025, Golar was in compliance with all covenants under its loan agreements[55] Security, Debt and Lease Restrictions - Financing agreements impose restrictions on incurring additional debt, creating liens, selling subsidiary shares, making investments, engaging in M&A, purchasing/selling vessels, share buy-backs, and dividend distributions[56] - Debt agreements require compliance with financial ratios, including positive working capital, tangible net worth, and minimum free cash ($50.0 million consolidated)[56] Cash Flows Net cash provided by operating activities increased significantly due to FLNG Gimi's pre-COD cash flows. Net cash used in investing activities increased due to higher capital expenditure for FLNG conversion projects and equity investments in SESA, partially offset by cash inflows from loan repayments and asset disposals. Net cash provided by financing activities increased substantially, driven by proceeds from the issuance of 2025 Convertible Bonds, partially offset by increased treasury share purchases and debt repayments Cash Flow Summary (Six months ended June 30) | (in thousands of $) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Net cash provided by operating activities | 191,899 | 92,209 | 99,690 | | Net cash used in investing activities | (342,104) | (124,384) | (217,720) | | Net cash provided by/(used in) financing activities | 340,924 | (117,774) | 458,698 | | Net increase/(decrease) in cash and cash equivalents, restricted cash and short-term deposits | 190,719 | (149,949) | 340,668 | - Operating cash increased by $99.7 million, primarily due to a $121.7 million increase in net pre-COD cash flows from FLNG Gimi[60] - Investing cash outflows increased by $217.7 million, mainly due to a $336.0 million increase in capital expenditure for FLNG conversion projects and $19.3 million in equity method investments in SESA[62] - Financing cash inflows increased by $458.7 million, driven by $564.2 million net proceeds from the issuance of 2.75% convertible senior unsecured notes, partially offset by $88.5 million in treasury share purchases and $23.7 million in debt repayments[66] Unaudited Condensed Consolidated Financial Statements Unaudited Consolidated Statements of Operations For the six months ended June 30, 2025, Golar LNG reported a net income of $43.7 million, a significant decrease from $101.7 million in the prior year. Total operating revenues increased to $138.2 million from $129.6 million, driven by sales-type lease revenue from FLNG Gimi. However, operating income decreased sharply to $3.4 million from $82.1 million, primarily due to a substantial shift from a $56.6 million gain to a $22.4 million loss on oil and gas derivative instruments, net of other operating losses Consolidated Statements of Operations (Six months ended June 30) | (in thousands of $) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Total operating revenues | 138,175 | 129,648 | 8,527 | | Total operating expenses | (110,728) | (104,138) | (6,590) | | Realized and unrealized (loss)/gain on oil and gas derivative instruments | (22,370) | 56,635 | (79,005) | | Operating income | 3,449 | 82,145 | (78,696) | | Net income | 43,718 | 101,725 | (58,007) | | Net income attributable to stockholders of Golar LNG Limited | 23,836 | 81,127 | (57,291) | | Basic earnings per share ($) | 0.23 | 0.78 | (0.55) | | Diluted earnings per share ($) | 0.23 | 0.77 | (0.54) | - Sales-type lease revenue of $8.2 million was recognized in 2025, with no comparable amount in 2024, reflecting the commencement of FLNG Gimi's operations[69] - Other non-operating income of $29.9 million was recognized in 2025, with no comparable amount in 2024[69] Unaudited Consolidated Statements of Comprehensive Income For the six months ended June 30, 2025, Golar LNG reported comprehensive income of $45.8 million, a decrease from $100.8 million in the prior year. This includes net income of $43.7 million and net other comprehensive income of $2.1 million, which primarily consists of gains associated with pensions and share of equity method investment's comprehensive income Consolidated Statements of Comprehensive Income (Six months ended June 30) | (in thousands of $) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Net income | 43,718 | 101,725 | (58,007) | | Net other comprehensive income/(loss) | 2,089 | (963) | 3,052 | | Comprehensive income | 45,807 | 100,762 | (54,955) | | Comprehensive income attributable to stockholders of Golar LNG Limited | 25,925 | 80,164 | (54,239) | - Net other comprehensive income in 2025 includes $1.1 million in gains associated with pensions and $0.98 million from equity method investments' comprehensive income[71] Unaudited Consolidated Balance Sheets As of June 30, 2025, Golar LNG's total assets increased to $4.77 billion from $4.37 billion at December 31, 2024. This was driven by a significant increase in current assets, particularly cash and cash equivalents and net investment in sales-type lease. Total liabilities also increased to $2.49 billion from $2.00 billion, mainly due to a rise in long-term debt. Stockholders' equity improved to $(1.89) billion from $(2.01) billion Consolidated Balance Sheets (as of June 30, 2025 and December 31, 2024) | (in thousands of $) | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Total current assets | 1,172,509 | 739,866 | 432,643 | | Total non-current assets | 3,599,074 | 3,627,811 | (28,737) | | Total assets | 4,771,423 | 4,367,677 | 403,746 | | Total current liabilities | (795,866) | (841,524) | 45,658 | | Total non-current liabilities | (1,689,487) | (1,156,749) | (532,738) | | Total liabilities | (2,485,353) | (1,998,273) | (487,080) | | Stockholders' equity | (1,886,010) | (2,014,151) | 128,141 | | Non-controlling interests | (400,060) | (355,253) | (44,807) | - Cash and cash equivalents increased by $217.0 million, and a current portion of net investment in sales-type lease of $148.9 million was recognized in 2025[74] - Assets under development decreased significantly from $2.26 billion to $874.4 million, primarily due to the derecognition of FLNG Gimi upon commencement of its sales-type lease[74] - Long-term debt increased by $505.4 million, largely due to the issuance of 2025 Convertible Bonds[74] Unaudited Consolidated Statements of Cash Flows For the six months ended June 30, 2025, Golar LNG reported a net increase in cash and equivalents of $190.7 million, a significant improvement from a $149.9 million decrease in the prior year. Net cash provided by operating activities increased by $99.7 million, mainly due to FLNG Gimi's pre-COD cash flows. Net cash used in investing activities increased by $217.7 million, driven by higher capital expenditures for FLNG conversion projects. Net cash provided by financing activities saw a substantial increase of $458.7 million, primarily from the issuance of 2025 Convertible Bonds Consolidated Statements of Cash Flows (Six months ended June 30) | (in thousands of $) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Net cash provided by operating activities | 191,899 | 92,209 | 99,690 | | Net cash used in investing activities | (342,104) | (124,384) | (217,720) | | Net cash provided by/(used in) financing activities | 340,924 | (117,774) | 458,698 | | Net increase/(decrease) in cash and cash equivalents, restricted cash and short-term deposits | 190,719 | (149,949) | 340,668 | | Cash and cash equivalents, restricted cash and short-term deposits at the end of the period | 907,301 | 621,521 | 285,780 | - Adjustments to reconcile net income to net cash from operating activities include a $29.9 million gain on deemed sale of FLNG Gimi and a $53.6 million change in fair value of oil and gas derivative instruments[75] - Additions to assets under development increased significantly to $425.0 million in 2025 from $89.0 million in 2024[75] - Proceeds from long-term debt of $575.0 million were recorded in 2025, with no comparable amount in 2024[76] Unaudited Consolidated Statements of Changes in Equity As of June 30, 2025, total equity decreased to $2.29 billion from $2.37 billion at December 31, 2024. This was primarily influenced by net income of $43.7 million, offset by $52.3 million in cash dividends paid and $102.7 million in repurchase and cancellation of treasury shares. Other comprehensive income contributed $2.1 million, and proceeds from equity interest subscription in Gimi MS Corporation added $21.0 million Consolidated Statements of Changes in Equity (Six months ended June 30) | (in thousands of $) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Balance at beginning of period | 2,369,404 | 2,602,443 | | Net income | 43,718 | 101,725 | | Dividends | (52,330) | (56,708) | | Purchase of treasury shares | (102,725) | (14,180) | | Other comprehensive income/(loss) | 2,089 | (963) | | Balance at end of period | 2,286,070 | 2,664,009 | - Repurchase and cancellation of treasury shares amounted to $102.7 million in 2025, significantly higher than $14.2 million in 2024[79] - Proceeds from subscription of equity interest in Gimi MS Corporation were $21.0 million in 2025, compared to $27.3 million in 2024[79] Notes to the Unaudited Condensed Consolidated Financial Statements 1. General Information Golar LNG Limited, incorporated in Bermuda and listed on Nasdaq, specializes in designing, constructing, owning, and operating marine infrastructure for natural gas liquefaction, focusing on FLNG as a service. As of June 30, 2025, the fleet includes operational FLNG Hilli and FLNG Gimi, with a third unit, MKII FLNG, under development. The company's going concern is supported by active exploration of debt optimization and new financing, with a contingency plan to terminate the MKII FLNG project if liquidity is insufficient - Golar LNG designs, constructs, owns, and operates marine infrastructure for natural gas liquefaction, specializing in FLNG as a service[84] - As of June 30, 2025, Golar operates FLNG Hilli and FLNG Gimi, with MKII FLNG under development, targeted for 2028 operations[85][91] - The company is actively exploring debt optimization and new financing to meet significant capital expenditure commitments for FLNG projects, with a contingency plan to terminate the MKII FLNG conversion if liquidity is insufficient[87][89][90] 2. Accounting Policies Golar LNG's unaudited condensed consolidated financial statements are prepared in accordance with U.S. GAAP, consistent with prior annual statements, with specific policies for lease accounting, convertible debt instruments, contingencies, and use of estimates. Lease arrangements are classified as sales-type or operating based on specific criteria, with sales-type lease interest income recognized as 'Sales-type lease revenue' within operating revenues. Convertible debt instruments are evaluated for embedded features, and the entire gross proceeds are allocated to the host debt liability if conversion features are indexed to own stock and eligible for equity classification. Management relies on estimates and judgments for asset recoverability and derivative valuations - Financial statements are prepared in accordance with U.S. GAAP and should be read with the 2024 annual report[92] - Lease accounting assesses whether arrangements contain a lease and classifies them as sales-type or operating based on specific criteria (e.g., ownership transfer, purchase option, economic life, fair value, specialized nature)[94][96][98] - For sales-type leases, interest income is recognized as 'Sales-type lease revenue' within operating revenues to reflect the integrated FLNG lease and operate model[97] - Convertible debt instruments are evaluated for embedded features; if indexed to own stock and eligible for equity classification, the entire proceeds are allocated to the host debt liability[100] - Management uses estimates and judgments for asset recoverability, derivative valuations, and contingent liabilities, which are inherently uncertain[102] Basis of Accounting - Unaudited condensed consolidated financial statements are prepared in accordance with U.S. GAAP[92] Significant Accounting Policies - Accounting policies are consistent with those in the audited consolidated financial statements for the year ended December 31, 2024, except for those disclosed in note 3[93] Lease Accounting (Lessor) - Contracts are assessed for lease components based on the counterparty's right to obtain economic benefits and direct asset use[94] - Leases are classified as sales-type if ownership transfers, there's a purchase option, the term covers a major part of economic life, present value of payments equals fair value, or the asset is specialized[96][98] - Sales-type lease interest income is recognized as 'Sales-type lease revenue' within operating revenues[97] - Total consideration for contracts with both lease and non-lease components is allocated using the relative standalone selling price method[99] Convertible Debt Instruments - Convertible debt instruments are evaluated for embedded features requiring bifurcation; if indexed to own stock and eligible for equity classification, the entire proceeds are allocated to the host debt liability[100] Contingencies - Contingent liabilities are recognized if probable and reasonably estimable; contingent gains are recognized only when realized or realizable[101] Use of Estimates - Preparation of financial statements requires management estimates, judgments, and assumptions, particularly for asset recoverability and derivative valuations, which are subject to change[102] 3. Recently Issued Accounting Standards Golar LNG has adopted ASU 2023-05 on Business Combinations - Joint Venture Formations, which does not directly affect its existing accounting policies but may indirectly impact newly formed equity method investees. The company is currently assessing the impact of several other recently issued ASUs, including those related to Income Tax Disclosures (ASU 2023-09), Income Statement Expense Disaggregation (ASU 2024-03), Debt with Conversion and Other Options (ASU 2024-04), Business Combinations and Consolidation (ASU 2025-03), Stock Compensation and Revenue from Contracts with Customers (ASU 2025-04), and Financial Instruments - Credit Losses (ASU 2025-05) - ASU 2023-05 (Business Combinations - Joint Venture Formations) has been adopted, with no direct impact on GLNG's existing policies but potential indirect effects on new equity method investees[103] - Golar is assessing the impact of ASU 2023-09 (Income Tax Disclosures), ASU 2024-03 (Income Statement Expense Disaggregation), ASU 2024-04 (Debt with Conversion and Other Options), ASU 2025-03 (Business Combinations and Consolidation), ASU 2025-04 (Stock Compensation and Revenue from Contracts with Customers), and ASU 2025-05 (Financial Instruments - Credit Losses)[104][105] 4. Segment Information Golar LNG now reports in two segments: FLNG and Corporate and other, having exited shipping operations in Q1 2025. The FLNG segment's total assets were $3.98 billion as of June 30, 2025, compared to $3.62 billion at December 31, 2024, while Corporate and other segment assets were $793.9 million and $744.3 million, respectively - Golar LNG has exited shipping operations and now classifies activities into two reportable segments: FLNG and Corporate and other[106][107] - FLNG Gimi achieved COD in June 2025, expanding the FLNG segment's earnings base[107] Total Assets by Segment (as of June 30, 2025 and December 31, 2024) | (in thousands of $) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | FLNG | 3,977,509 | 3,623,417 | | Corporate and other | 793,914 | 744,260 | | Total assets | 4,771,423 | 4,367,677 | - Other operating loss in the Corporate and other segment includes a $0.5 million loss on disposal of Golar Arctic and a $1.1 million credit loss allowance on the Higas shareholder loan[113][114] 5. Revenue Total operating revenues for the six months ended June 30, 2025, increased to $138.2 million from $129.6 million in 2024. This increase was primarily driven by the commencement of FLNG Gimi's sales-type lease revenue ($8.2 million) and higher vessel management fees. Conversely, time and voyage charter revenues decreased significantly due to the exit from shipping operations. Revenue from contracts with customers includes liquefaction services and vessel management fees, while lease revenues comprise sales-type lease revenue from FLNG Gimi and operating lease revenue from legacy time and voyage charters. Contract liabilities increased substantially due to deferred pre-COD cash flows for FLNG Gimi Total Operating Revenues (Six months ended June 30) | (in thousands of $) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Liquefaction services revenue | 112,200 | 112,488 | (288) | | Sales-type lease revenue | 8,219 | — | 8,219 | | Vessel management fees and other revenues | 16,880 | 10,830 | 6,050 | | Time and voyage charter revenues | 876 | 6,330 | (5,454) | | Total operating revenues | 138,175 | 129,648 | 8,527 | 5.1 Revenue from Contracts with Customers Revenue from Contracts with Customers (Six months ended June 30) | (in thousands of $) | 2025 | 2024 | | :--- | :--- | :--- | | Liquefaction services revenue | 112,200 | 112,488 | | Vessel management fees and other revenues | 16,880 | 10,830 | - Liquefaction services revenue includes base tolling fees, amortization of Day 1 gains, incremental base tolling fees (linked to TTF prices), and amortization of deferred commissioning period revenue[119][120][121][122][123] - Vessel management fees and other revenues include management fees and FLNG O&M service revenue from FLNG Gimi's LOA, with total contract consideration allocated between lease and non-lease components[124][125] 5.2 Lease Revenues Lease Revenues (Six months ended June 30) | (in thousands of $) | 2025 | 2024 | | :--- | :--- | :--- | | Sales-type lease revenue | 8,219 | — | | Operating lease revenue | 596 | 3,581 | | Variable operating lease revenue | 280 | 2,749 | | Time and voyage charter revenues | 876 | 6,330 | - FLNG Gimi achieved COD on June 12, 2025, commencing its 20-year lease term and resulting in a $30.0 million gain on deemed sale[129][130] - Sales-type lease revenue for FLNG Gimi includes interest income on the net investment, variable lease revenue, and accretion of unguaranteed residual value[135][136] Maturity Analysis of Net Investment in Sales-type Lease (as of June 30, 2025) | Period ending December 31, | Amount (in thousands of $) | | :--- | :--- | | 2025 (six months) | 73,714 | | 2026 | 153,300 | | 2027 | 153,300 | | 2028 | 153,720 | | 2029 | 153,300 | | 2030 and thereafter | 2,369,640 | | Total minimum lease receivable | 3,056,974 | | Unguaranteed residual value | 332,400 | | Gross investment in sales-type lease | 3,389,374 | | Less: unearned interest income | (1,623,632) | | Net investment in sales-type lease | 1,765,742 | Contract Assets and Liabilities Contract Assets and Liabilities (as of June 30, 2025 and December 31, 2024) | (in thousands of $) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Contract assets | 23,477 | 19,696 | | Current contract liabilities | (6,064) | (4,220) | | Non-current contract liabilities | (35,078) | (2,145) | | Total contract liabilities | (41,142) | (6,365) | - Total contract liabilities increased significantly due to the deferral of $36.9 million in pre-COD cash flows related to the FLNG Gimi LOA[128][134] 6. Earnings Per Share For the six months ended June 30, 2025, Golar LNG reported basic and diluted EPS of $0.23, a decrease from $0.78 and $0.77, respectively, in the prior year. This reflects a lower net income attributable to stockholders. The weighted average number of common shares outstanding for diluted EPS increased to 105.5 million, including a dilutive impact from the 2025 Convertible Bonds Earnings Per Share (Six months ended June 30) | | 2025 | 2024 | | :--- | :--- | :--- | | Basic earnings per share ($) | 0.23 | 0.78 | | Diluted earnings per share ($) | 0.23 | 0.77 | Weighted Average Common Shares Outstanding (Six months ended June 30) | (in thousands of $) | 2025 | 2024 | | :--- | :--- | :--- | | Basic: Weighted average number of common shares outstanding | 104,655 | 104,278 | | Dilutive: Dilutive impact of share options and RSUs | 807 | 724 | | Dilutive impact of 2025 Convertible Bonds | 55 | — | | Weighted average number of common shares outstanding (Diluted) | 105,517 | 105,002 | - Net income attributable to non-controlling interests decreased to $19.9 million in 2025 from $20.6 million in 2024[69] 7. Realized and Unrealized (Loss)/Gain on Oil and Gas Derivative Instruments For the six months ended June 30, 2025, Golar LNG reported a net realized and unrealized loss of $22.4 million on oil and gas derivative instruments, a significant decline from a $56.6 million gain in 2024. This shift was primarily due to a $33.1 million decrease in realized gains from the maturity of TTF swaps and a $45.9 million increase in unrealized losses, driven by changes in the fair value of FLNG Hilli's oil and gas derivative instruments Realized and Unrealized (Loss)/Gain on Oil and Gas Derivative Instruments (Six months ended June 30) | | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Realized gain on FLNG Hilli's oil derivative instrument | 21,249 | 36,656 | (15,407) | | Realized gain on FLNG Hilli's gas derivative instrument | 16,198 | 9,162 | 7,036 | | Realized MTM adjustment on commodity swap derivatives | — | 24,719 | (24,719) | | Realized gain on oil and gas derivative instruments | 37,447 | 70,537 | (33,090) | | Unrealized (loss)/gain on FLNG Hilli's oil derivative instrument | (39,450) | 15,092 | (54,542) | | Unrealized loss on FLNG Hilli's gas derivative instrument | (20,367) | (5,294) | (15,073) | | Unrealized MTM adjustment on commodity swap derivatives | — | (23,700) | 23,700 | | Unrealized loss on oil and gas derivative instruments | (59,817) | (13,902) | (45,915) | | Realized and unrealized (loss)/gain on oil and gas derivative instruments | (22,370) | 56,635 | (79,005) | - The commodity swaps hedging FLNG Hilli's TTF-linked earnings matured on December 31, 2024, resulting in no realized or unrealized MTM adjustments in 2025[143] - Realized gains result from monthly billings above the base tolling fee and incremental capacity, while unrealized gains/losses stem from movements in forecasted oil and natural gas prices and Euro/U.S. Dollar exchange rates[144] 8. (Loss)/Gain on Derivative Instruments and Other Financial Items, Net For the six months ended June 30, 2025, Golar LNG reported a net loss of $10.6 million on derivative instruments, a reversal from a $6.3 million gain in 2024. This was primarily due to an $11.6 million unrealized MTM adjustment loss on interest rate swap (IRS) derivatives. Other financial items, net, resulted in a $3.3 million loss, mainly from financing arrangement fees and foreign exchange losses (Loss)/Gain on Derivative Instruments, Net (Six months ended June 30) | (in thousands of $) | 2025 | 2024 | | :--- | :--- | :--- | | Unrealized MTM adjustment for interest rate swap ("IRS") derivatives | (11,611) | 1,754 | | Net interest income on undesignated IRS derivatives | 973 | 4,555 | | (Losses)/gains on derivative instruments, net | (10,638) | 6,309 | Other Financial Items, Net (Six months ended June 30) | (in thousands of $) | 2025 | 2024 | | :--- | :--- | :--- | | Financing arrangement fees and other related costs | (2,064) | (3,768) | | Foreign exchange loss on operations | (1,138) | 460 | | Amortization of debt guarantees | 106 | 827 | | Others | (169) | (213) | | Other financial items, net | (3,265) | (2,694) | - The unrealized MTM adjustment for IRS derivatives shifted from a $1.8 million gain in 2024 to an $11.6 million loss in 2025[145] 9. Variable Interest Entities ("VIEs") Golar LNG consolidates three Variable Interest Entities (VIEs): a lessor VIE for FLNG Hilli, Golar Hilli LLC (which ceased being a VIE after Golar acquired 100% ownership in December 2024), and Gimi MS Corporation for FLNG Gimi. The lessor VIE's assets and liabilities, including restricted cash and debt, significantly impact Golar's balance sheet. Gimi MS Corporation, where Golar is the primary beneficiary, also has a significant impact on consolidated financial statements, particularly with sales-type lease revenue and additions to assets under development - Golar consolidates a lessor VIE for FLNG Hilli, Golar Hilli LLC (now a Voting Interest Entity), and Gimi MS Corporation for FLNG Gimi[146][151][153] 9.1 Lessor VIE - Golar leases FLNG Hilli from a CSSC entity via a sale and leaseback, with an option/obligation to repurchase the vessel[146] Lessor VIE Assets and Liabilities (as of June 30, 2025 and December 31, 2024) | (in thousands of $) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Restricted cash and short-term deposits | 16,466 | 17,472 | | Accrued expenses | (17,011) | (12,244) | | Other current liabilities | (184,000) | (184,000) | | Total debt | (271,313) | (311,983) | Lessor VIE Impact on Operations (Six months ended June 30) | (in thousands of $) | 2025 | 2024 | | :--- | :--- | :--- | | Other financial items, net | 1,216 | 3,749 | | Interest expense | 7,730 | 10,381 | | Net debt repayments | (40,882) | (42,670) | 9.2 Golar Hilli LLC - Golar repurchased all remaining non-controlling interest in Hilli LLC in December 2024, achieving 100% ownership, and the entity ceased to be a VIE, becoming a Voting Interest Entity[151] Golar Hilli LLC Impact on Operations (Six months ended June 30, 2024) | (in thousands of $) | 2024 | | :--- | :--- | | Liquefaction services revenue | 112,488 | | Realized and unrealized gain/(loss) on oil and gas derivative instruments | 56,635 | | Net debt repayments | (42,670) | | Cash dividends paid | (4,737) | 9.3 Gimi MS Corporation - Gimi MS Corporation is consolidated as a VIE, with Golar as the primary beneficiary, retaining sole control and the greatest exposure to variability in returns[153] Gimi MS Corporation Assets and Liabilities (as of June 30, 2025 and December 31, 2024) | (in thousands of $) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Current assets | 203,896 | 139,911 | | Non-current assets | 1,766,641 | 1,795,646 | | Current liabilities | (125,058) | (186,149) | | Non-current liabilities | (611,353) | (602,819) | Gimi MS Corporation Impact on Operations (Six months ended June 30) | (in thousands of $) | 2025 | 2024 | | :--- | :--- | :--- | | Sales-type lease revenue | 5,682 | — | | Vessel management fees and other revenues | 3,293 | — | | Other non-operating income | 29,981 | — | | Additions to asset under development | 152,583 | 88,965 | | Proceeds from subscription of equity interest | 21,020 | 27,278 | 10. Restricted Cash and Short-Term Deposits As of June 30, 2025, total restricted cash and short-term deposits decreased to $123.9 million from $150.2 million at December 31, 2024. This includes $93.4 million related to FLNG Gimi (pre-commissioning contractual cash flows), $16.5 million held by a lessor VIE, and $13.0 million for the LNG Hrvatska O&M Agreement. Notably, $61.0 million in restricted cash related to FLNG Hilli was released in June 2025 Restricted Cash and Short-Term Deposits (as of June 30, 2025 and December 31, 2024) | (in thousands of $) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Restricted cash in relation to the FLNG Gimi | 93,351 | 58,107 | | Restricted cash and short-term deposits held by lessor VIE | 16,466 | 17,472 | | Restricted cash relating to the LNG Hrvatska O&M Agreement | 12,987 | 12,715 | | Restricted cash in relation to the FLNG Hilli | — | 60,955 | | Total restricted cash and short-term deposits | 123,874 | 150,198 | - Restricted cash for FLNG Gimi increased due to pre-commissioning contractual cash flows, remaining restricted post-COD[155] - The $61.0 million cash collateral supporting a letter of credit for FLNG Hilli was released in June 2025[157] 11. Other Current Assets Other current assets decreased to $13.0 million as of June 30, 2025, from $47.9 million at December 31, 2024. This significant reduction is primarily due to the reclassification of $31.6 million in receivables from bp to 'Trade receivables' following FLNG Gimi's COD. Prepaid expenses and interest receivable remained relatively stable Other Current Assets (as of June 30, 2025 and December 31, 2024) | (in thousands of $) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Prepaid expenses | 3,730 | 2,939 | | Interest receivable from money market deposits and bank accounts | 1,962 | 2,053 | | Receivable from IRS derivatives | 1,415 | 1,745 | | Inventories | 870 | 2,077 | | MTM asset on IRS derivatives | — | 422 | | Other | 5,048 | 38,646 | | Total Other current assets | 13,025 | 47,882 | - Receivables from bp of $31.6 million were reclassified from 'Other current assets' to 'Trade receivables' following FLNG Gimi's COD[158] 12. Assets Under Development Assets under development decreased significantly to $874.4 million as of June 30, 2025, from $2.26 billion at December 31, 2024. This was primarily due to the derecognition of FLNG Gimi ($1.82 billion) upon commencement of its sales-type lease. Conversely, MKII FLNG development costs increased, with $76.3 million from the Fuji LNG vessel reclassified and $284.6 million in additions, bringing its total to $874.4 million. The total estimated budget for MKII FLNG conversion is $2.2 billion, with delivery expected in Q4 2027 Assets Under Development (as of June 30, 2025 and December 31, 2024) | (in thousands of $) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | FLNG Gimi | — | 1,762,632 | | MKII FLNG | 874,408 | 498,565 | | Total | 874,408 | 2,261,197 | 12.1. FLNG Gimi - FLNG Gimi achieved COD on June 12, 2025, leading to the derecognition of its $1.82 billion asset under development and recognition of a sales-type lease receivable[160] - $43.2 million of capital spares and consumables were invoiced to bp upon COD, reducing the asset under development[160] 12.2 MKII FLNG - Golar entered an EPC agreement with CIMC for a 3.5 mtpa MKII FLNG conversion, with B&V providing technology and design[161] - All MKII FLNG costs ($255.3 million) were reclassified to 'Assets under development' following the binding EPC agreement[162] - The Fuji LNG donor vessel (net book value $76.3 million) was reclassified to 'Assets under development' upon its arrival at CIMC's yard in February 2025[163] - The total estimated budget for MKII FLNG conversion is $2.2 billion, excluding financing costs, with delivery expected in Q4 2027[165] Estimated Outstanding Payments for MKII FLNG Conversion (as of June 30, 2025) | Period ending December 31, | Amount (in thousands of $) | | :--- | :--- | | 2025 (six months) | 368,400 | | 2026 | 433,569 | | 2027 | 433,573 | | 2028 | 289,891 | | Total | 1,525,433 | 13. Equity Method Investments Net income from equity method investments increased to $10.3 million for the six months ended June 30, 2025, from a $2.3 million loss in 2024, primarily due to a $10.3 million gain on the disposal of Avenir shares. As of June 30, 2025, Golar's equity method investments totaled $35.1 million, including a new 10% equity interest in Southern Energy S.A. (SESA) for $19.3 million, and investments in LOGAS, ECGS, and Aqualung. The remaining 39.1 million shares in Avenir were divested in February 2025 Net Income/(Loss) from Equity Method Investments (Six months ended June 30) | (in thousands of $) | 2025 | 2024 | | :--- | :--- | :--- | | Gain/(loss) on disposal | 10,288 | (518) | | Share of net loss of equity method investments | (1) | (1,821) | | Net income/(loss) from equity method investments | 10,287 | (2,339) | Carrying Values of Equity Method Investments (as of June 30, 2025 and December 31, 2024) | (in thousands of $) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Southern Energy S.A. ("SESA") | 19,271 | — | | Logística e Distribuição de Gás S.A. ("LOGAS") | 8,060 | 7,183 | | Egyptian Company for Gas Services S.A.E ("ECGS") | 5,737 | 5,502 | | Aqualung Carbon Capture AS ("Aqualung") | 1,992 | 2,046 | | Avenir LNG Limited ("Avenir") | — | 28,934 | | Equity method investments | 35,060 | 43,665 | - Golar contributed $19.3 million to SESA for a 10% equity interest and significant influence, adopting the equity method of accounting[169] - Golar divested its remaining 39.1 million shares in Avenir in February 2025 for $1.0 per share, recognizing a $10.3 million gain[170] 14. Other Non-Current Assets Other non-current assets decreased to $95.4 million as of June 30, 2025, from $160.2 million at December 31, 2024. This reduction is primarily due to decreases in the fair value of gas and oil derivative instruments. Pre-operational assets increased, including costs for Macaw Energies' F2X project and FLNG Hilli redeployment, as well as FEED study costs for a Mark III FLNG unit Other Non-Current Assets (as of June 30, 2025 and December 31, 2024) | (in thousands of $) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Gas derivative instrument | 26,785 | 47,152 | | MTM asset on IRS derivatives | 21,806 | 32,995 | | Oil derivative instrument | 19,226 | 58,676 | | Pre-operational assets | 12,518 | 8,782 | | Operating lease right-of-use-assets | 7,075 | 6,771 | | Other | 7,961 | 5,855 | | Total Other non-current assets | 95,371 | 160,231 | - Pre-operational assets include $8.3 million for Macaw Energies' F2X project, $4.2 million for FLNG Hilli redeployment engineering costs, and FEED study costs for a potential Mark III FLNG unit[173] 15. Debt As of June 30, 2025, total debt, net of deferred financing costs, increased to $1.95 billion from $1.45 billion at December 31, 2024. This was primarily driven by the issuance of $575.0 million in 2.75% convertible senior unsecured notes (2025 Convertible Bonds) maturing in December 2030. The Gimi facility debt decreased, and the CSSC VIE debt also saw a reduction. The 2025 Convertible Bonds are recognized as a debt liability at amortized cost, with the conversion feature not requiring bifurcation Total Debt (Gross) (as of June 30, 2025 and December 31, 2024) | (in thousands of $) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Gimi facility | (641,667) | (670,833) | | 2025 Convertible Bonds | (575,000) | — | | 2021 Unsecured Bonds | (189,678) | (189,642) | | 2024 Unsecured Bonds | (300,000) | (300,000) | | CSSC VIE debt - FLNG Hilli facility | (273,584) | (314,466) | | Total debt (gross) | (1,979,929) | (1,474,941) | | Less: Deferred financing costs | 31,474 | 22,686 | | Total debt, net of deferred financing costs | (1,948,455) | (1,452,255) | - The 2025 Convertible Bonds, issued for $575 million, have an initial conversion rate of 17.3834 common shares per $1,000 principal amount, equivalent to $57.53 per share[175] - A portion of the convertible bond proceeds was used to repurchase and cancel 2.5 million common shares for $102.7 million[176] Debt Breakdown (as of June 30, 2025) | (in thousands of $) | Golar debt | VIE debt | Total debt | | :--- | :--- | :--- | :--- | | Current portion of long-term debt and short-term debt | (244,060) | (267,985) | (512,045) | | Long-term debt | (1,433,082) | (3,328) | (1,436,410) | | Total | (1,677,142) | (271,313) | (1,948,455) | 16. Accrued Expenses Accrued expenses significantly increased to $169.8 million as of June 30, 2025, from $66.1 million at December 31, 2024. This rise was primarily driven by a substantial increase in vessel-related accrued expenses, particularly for MKII FLNG conversion and FLNG Gimi commissioning works. Finance-related and administrative-related accrued expenses remained relatively stable Accrued Expenses (as of June 30, 2025 and December 31, 2024) | (in thousands of $) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Vessel related | (125,000) | (24,999) | | Finance related | (31,662) | (27,560) | | Administrative related | (12,966) | (13,502) | | Corporate income tax payable | (212) | (10) | | Accrued expenses | (169,840) | (66,071) | - Vessel-related accrued expenses increased significantly, including $66.2 million for MKII FLNG conversion and $43.5 million for FLNG Gimi commissioning works[177] 17. Other Current Liabilities Other current liabilities decreased to $31.1 million as of June 30, 2025, from $55.3 million at December 31, 2024. This change is mainly due to the reclassification of pre-COD cash flows, which were previously recognized as a liability, into deferred non-lease components. The current portion of Day 1 gain deferred revenue remained stable, while deferred revenue and pre-COD cash flows saw reductions Other Current Liabilities (as of June 30, 2025 and December 31, 2024) | (in thousands of $) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Day 1 gain deferred revenue - current portion | (12,783) | (12,783) | | Deferred revenue | (4,220) | (5,360) | | Current portion of operating lease liability | (1,997) | (1,587) | | Current portion of deferred pre-COD cash flows | (1,844) | — | | Pre-COD cash flows | — | (23,842) | | Other | (10,228) | (11,693) | | Total Other current liabilities | (31,072) | (55,265) | - Net contractual payments of $123.1 million were received from bp prior to COD, including project milestones and temporary crew accommodation payments, partially offset by $109.9 million in liquidated damages paid to bp[180][184] - The deferred non-lease component of pre-COD cash flows amounted to $36.8 million, with $1.8 million in current liabilities and $35.0 million in non-current liabilities, to be recognized evenly over the 20-year LOA term[180] 18. Other Non-Current Liabilities Other non-current liabilities increased to $253.1 million as of June 30, 2025, from $225.8 million at December 31, 2024. This increase is primarily due to the recognition of $35.0 million in deferred pre-COD cash flows related to the FLNG Gimi LOA. The VIE dividend payable remained stable at $184.0 million, while Day 1 gain deferred revenue and deferred commissioning period revenue saw reductions Other Non-Current Liabilities (as of June 30, 2025 and December 31, 2024) | (in thousands of $) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | VIE dividend payable | (184,000) | (184,000) | | Deferred pre-COD cash flows | (34,976) | — | | Pension obligations | (20,550) | (21,209) | | Non-current portion of operating lease liabilities | (5,668) | (5,124) | | Day 1 gain deferred revenue | (384) | (6,604) | | Deferred commissioning period revenue | (102) | (2,145) | | Other | (7,397) | (6,694) | | Total Other non-current liabilities | (253,077) | (225,776) | - A $184.0 million dividend declared by the lessor VIE to a CSSC entity is fully consolidated as an unpaid, unsecured, interest-free liability due in late 2026[181] - Deferred pre-COD cash flows of $35.0 million were recognized, representing the non-lease component of FLNG Gimi's LOA, to be recognized evenly over the 20-year term[181] 19. Financial Instruments Golar LNG's financial instruments are valued using a fair value hierarchy. As of June 30, 2025, cash and equivalents, restricted cash, and trade receivables are classified as Level 1. Debt instruments, including current and long-term debt, are primarily Level 2, with 2021 and 2024 Unsecured Bonds now Level 1 due to quoted market prices. Oil and gas derivative instruments and IRS derivatives are classified as Level 2.