LNG shipper Golar dropped to a loss in the first quarter of the year as its interest expense increased compared to the previous quarter.

According to its quarterly report, Golar LNG reported a $21 million net loss, dropping from a $3.8 million profit in the previous quarter.

The $24.8 million decrease was impacted by the rise in interest expense to $14 million as well as a market-to-market loss of $9.2 million on TRS shares as the company’s share price dropped. The loss was partially offset by a $7.3 million gain in respect to market-to-market valuation of interest rate swaps.

LNG Shipping

Steady rates and charter activity into the new-year were supported by strong underlying demand for LNG that helped sustain firm Asian prices and prolong arbitrage opportunities through to February.

Looking further ahead, a 9-month delay to the start-up of the 13.2 mtpa Freeport LNG plant has been confirmed. Shipbroker research indicates that the 2018 newbuild delivery schedule is adjusting to accommodate this, Golar LNG said.

Approximately 49 carrier deliveries are now scheduled to deliver in 2018 and liquefaction trains with a nameplate capacity of approximately 31 mtpa are expected to commence and ramp up production.

Looking forward, the company expects the shipping market to enter into a seasonal soft spot, negatively impacting the second quarter time charter equivalent (TCE) which is expected to be around half of the levels reported in the first quarter.

However, the shipper expects the market will be on a path of sustainable recovery from the third quarter 2018 onwards.