Flex LNG Orders Third SPB LNG Vessel

Flex LNG has ordered an additional 90,000 m3 SPB LNG vessel from Samsung Heavy Industries (SHI). This will be the 3rd vessel ordered by Flex LNG in 2007 and is of identical design and incorporates the same flexibility and option as the two first orders signed on March 14, 2007. The vessel is scheduled to be on station, producing LNG in Q4 2011

CEO of FLEX LNG, Philip Fjeld comments in relation to the orders:

"In a world where bespoke design and "mega-sizing" LNG plants has driven the construction cost of traditional liquefaction plants to levels the LNG industry has not seen before, we are convinced our generic LNG Producer design will impress both our competitors and clients by offering the most efficient unit cost CAPEX for LNG production, even when compared to projects with an annual capacity of 5-10 times our size.

The world is in desperate need for increased liquefaction capacity and the market has room for several players with different concepts. Today there are two mature and well-advanced floating liquefaction concepts in the market. Flex LNG and SBM are offering the industry similar, but at the same time very different concepts. Both solutions will use the proven and robust SPB LNG containment system and will offer the LNG industry a lead time that is significantly shorter than for onshore projects."

When asked what has surprised FLEX LNG the most over the past 6 months, Philip Fjeld says:

"Two things have amazed us: Firstly, the LNG industry is a conservative industry and introducing a groundbreaking concept such as the world's floating liquefaction units is not a simple task. However, the reception Flex LNG has experienced by the industry has been astonishing. We believe this is a clear testament that our philosophy of bundling proven technology, with an open-minded commercial and technical approach has been well received. The company that succeeds in becoming a leader in floating liquefaction needs a strong and clear vision at the same time as it needs to listen and adjust to the LNG industry's requirements, concerns and ideas.

Secondly, the commercial interest for our units has surprised even the most optimistic members of the Flex LNG team. We are working closely with a large number of potential clients and we are currently seeing a much greater demand for vessels than what we have placed firm orders for. We are optimistic that further significant commercial progress will be made within a relatively short timeframe".

Philip Fjeld's concluding remark is: "We sincerely believe that the true winner in this game will be the companies that hold the first mover advantage and best resources, both financially and organizationally to successfully execute such huge projects. We are focused on the tasks ahead and put project execution as our number one priority. This will be achieved through continuing to work with world class partners, using proven technology in an innovative way, hiring excellent people and always looking to improve."

Flex LNG was incorporated in 2006 with the objective of commercializing the world's first floating liquefaction units (LNG Producers) and signed a ship building contract with SHI on 14 March 2007 for two units utilizing the SPB LNG containment system. By using the proven nitrogen expander liquefaction cycle, the most robust and flexible liquefaction technology in use in the LNG industry, an LNG Producer can source gas from hundreds of potential offshore locations world wide where natural gas today is either left stranded or is being flared.

After concluding the shipbuilding contract with SHI for the third unit, Flex LNG will have three LNG Producers on station producing LNG in 2011. This provides the LNG industry with a unique possibility of accessing currently uncommitted LNG supply in 2011.