Mike Webber's questions to Cool Co (CLCO) leadership • Q4 2023
Question
Asked about the economics of the Husky's upgrades, the full impact of Red Sea rerouting, charterer behavior regarding new LNG volumes, returns on newbuilds, and balance sheet flexibility.
Answer
The economic benefit from the Husky's upgrades will be calculated by comparing pre- and post-drydock performance and then shared with the charterer. The full impact of Red Sea rerouting is still to come as more LNG volumes are forced to travel longer distances. Newbuild returns require rates over $100k/day, creating a bid-offer spread in the current market. Regarding financing, the company chose to upsize a longer-maturity facility for better terms, though the shorter-term one also had capacity.