Published: 2022-08-31 00:00:00 ET

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Golar LNG Limited (the “Company”, “Golar”) was incorporated in Hamilton, Bermuda on May 10, 2001 for the purpose of acquiring the liquefied natural gas (“LNG") shipping interests of Osprey Maritime Limited, which was owned by World Shipholding Limited.

We design, build, own, and operate marine infrastructure for the liquefaction and regasification of LNG. We also operate vessels on behalf of third parties. As of June 30, 2022, our fleet was comprised of two LNG carrier (contracted for conversion to a Floating Storage Regasification Unit (“FSRU”) and subsequent sale, and one vessel earmarked for conversion to a FLNG) and two Floating Liquefaction Natural Gas vessels (“FLNGs”) (including one vessel under conversion to a FLNG).

We are listed on the Nasdaq under the ticker: “GLNG”.

As used herein and unless otherwise required by the context, the terms “Golar”, the “Company”, “we”, “our” and words of similar import refer to Golar or any one or more of its consolidated subsidiaries, or to all such entities.

Basis of accounting

These unaudited consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). These unaudited consolidated financial statements do not include all of the disclosures required under U.S. GAAP in annual consolidated financial statements, and should be read in conjunction with our audited consolidated annual financial statements for the year ended December 31, 2021, which are included in our annual report on Form 20-F for the fiscal year ended December 31, 2021, filed with the Securities and Exchange Commission on April 28, 2022 (the “2021 Annual Report”).

As further discussed in note 11, “Assets and Liabilities Held-for-Sale and Discontinued Operations”, during the first and second quarter of 2022, we (i) disposed of substantially all of our fleet of LNG carriers and our shipping and management business to the Cool Company Ltd. (“CoolCo”), (the “CoolCo Disposal”) and (ii) sold all of the shares of our subsidiary, Golar NB13 Corporation, including FSRU Golar Tundra, to Asset Company 11 S.R.L (part of Italy's SNAM group, or “Snam”) (the “TundraCo Disposal”).

The CoolCo Disposal met the criteria to be classified as held-for-sale and reported as discontinued operations on various dates during the six months ended June 30, 2022, and the TundraCo Disposal met the criteria to be classified as held-for-sale and reported as discontinued operations on May 30, 2022. The related assets, liabilities and operating results of the CoolCo Disposal and the TundraCo Disposal are presented as discontinued operations for all periods presented herein.

Significant accounting policies

The accounting policies adopted in the preparation of these unaudited consolidated financial statements for the six months ended June 30, 2022 are consistent with those followed in the preparation of our 2021 Annual Report, except for those disclosed in note 3 that did not have any material impact on the interim information for the six months ended June 30, 2022.

Use of estimates

The preparation of financial statements in accordance with U.S. GAAP requires that management make estimates and assumptions affecting the reported amounts of assets and liabilities and disclosure of material contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

In assessing the recoverability of our vessels’ carrying amounts, we make assumptions regarding estimated future cash flows, estimates in respect of residual value, charter rates, ship operating expenses and drydocking requirements.

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Adoption of new accounting standards

In March 2020, the FASB issued ASU 2020-04 Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting and in January 2021 the FASB issued ASU 2021-01 Reference Rate Reform (Topic 848): Scope. These amendments provide temporary optional expedients and exception for applying U.S. GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. We currently do not believe the use of optional expedients in ASU 2020-04 and ASU 2021-01 will have a significant impact on our consolidated financial statements, however we will continue to evaluate this until December 31, 2022.

In August 2020, the FASB issued ASU 2020-06 Debt – Debt with Conversion and Other Options (Topic 470) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Topic 815). The amendments simplify the issuer’s accounting for convertible instruments and its application of the equity classification guidance. The new guidance eliminates some of the existing models for assessing convertible instruments, which results in more instruments being recognized as a single unit of account on the balance sheet and expands disclosure requirements. The new guidance simplifies the assessment of contracts in an entity’s own equity and existing EPS guidance in ASC 260. We adopted this with effect from January 1, 2022. We adjusted the additional paid in capital as of January 1, 2022 in our unaudited consolidated statement of changes in equity as included herein.

In May 2021, the FASB issued ASU 2021-04 Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging —Contracts in Entity’s Own Equity (Subtopic 815-40). We adopted this with effect from January 1, 2022. The adoption of ASU 2021-04 had no impact on our consolidated financial statements.

In July 2021, the FASB issued ASU 2021-05 Leases (Topic 842) – Lessors – Certain Leases with Variable Lease Payments. We adopted this with effect from January 1, 2022. The adoption of ASU 2021-05 has no impact on our consolidated financial statements.

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Accounting pronouncements that have been issued but not yet adopted

The following table provides a brief description of recent accounting standards that have been issued but not yet adopted:

Standard			Description			Date of Adoption			Effect on our Consolidated Financial Statements or Other Significant Matters
ASU 2021-08 Business Combinations (Topic 805) - Accounting for contract assets and contract liabilities from contracts with customers			Requires contract assets and contract liabilities (i.e., deferred revenue) acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with ASC 606. Generally, this new guidance will result in the acquirer recognizing contract assets and contract liabilities at the same amounts recorded by the acquiree (rather than having such amounts recognized by the acquirer at fair value in acquisition accounting, as has been historical practice).			January 1, 2023			No impact currently expected as a result of the adoption of this ASU.
ASU 2022-03 Fair Value Measurement (Topic 820) - Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions			This amendment is intended to reduce diversity in practice in the measurement of the fair value of equity securities subject to contractual sale restrictions. For entities that have investments in equity securities that are subject to contractual sale restrictions, the contractual restriction on the sale is not considered part of the unit of account of the equity security, is not considered when measuring fair value and additional disclosures are required. This amendment is required to be applied prospectively from date of adoption; early adoption is permitted.			January 1, 2024			No impact currently expected as a result of the adoption of this ASU.

We provide and operate three distinct reportable segments as follows:

•Shipping – This segment is based on the business activities of the transportation of LNG carriers. We operate and subsequently charter out LNG carriers on fixed terms to customers.

•FLNG – This segment is based on the business activities of FLNG vessels or projects. We convert LNG carriers into FLNG vessels, or build new FLNG vessels and subsequently charter them out to customers. We currently have one operational FLNG, the Hilli, one undergoing conversion into a FLNG, the Gimi (note 15).

•Corporate and other – This segment is based on the business activities of vessel management and administrative services and our corporate overhead costs.

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A reconciliation of net income to Adjusted EBITDA is as follows:

			Six months ended June 30,
(in thousands of $)			2022			2021
Net income			696,552			570,439
Income taxes			184			274
Income before income taxes			696,736			570,713
Depreciation and amortization			26,880			27,734
Impairment of long-term assets (1)			76,155			—
Unrealized gain on oil and gas derivative instruments (note 7)			(349,607)			(81,190)
Realized and unrealized (gains)/losses on our investment in listed equity securities (note 8)			(295,048)			86,664
Other non-operating (income)/losses (note 8)			(10,023)			71,431
Interest income			(954)			(57)
Interest expense			11,435			16,568
Gains on derivative instruments (note 9)			(47,877)			(16,482)
Other financial items, net (note 9)			3,607			(586)
Net income from equity method investments (note 16)			(3,009)			(157)
Net loss/(income) from discontinued operations (note 11)			82,352			(594,439)
Adjusted EBITDA			190,647			80,199

(1) In May 2022, we entered into a sale and purchase agreement (the “Arctic SPA”) with SNAM RETE GAS S.p.A (part of “Snam”), pursuant to which, upon receipt of a notice to proceed, we will convert LNG carrier Golar Arctic to a FSRU, deliver, install and connect her to Snam's mooring, and following completion of commissioning activities and provisional acceptance, we will sell her to Snam. Entry into the Arctic SPA changes the expected recovery of Golar Arctic's carrying amount from continued use in operations over her remaining useful life, to recovery from sale, and was considered an indicator of impairment. The revised future estimated cash flows were less than her carrying amount on June 30, 2022 and an impairment charge of $76.2 million was recognized, reflecting an adjustment to her fair value (based on average broker valuation at date of measurement and represents the exit price in the principal LNG carrier sales market).

			Six months ended June 30, 2022
(in thousands of $)			Shipping			FLNG			Corporate and other (1)			Total results from continuing operations
Statement of Operations:
Total operating revenues			3,235			123,421			13,509			140,165
Vessel operating expenses			(3,819)			(29,153)			(3,228)			(36,200)
Voyage, charterhire and commission expenses			(1,109)			(300)			(50)			(1,459)
Administrative expenses			69			(29)			(20,103)			(20,063)
Project development expenses			—			(5,002)			1,450			(3,552)
Realized gain on oil and gas derivative instruments, net (note 7)			—			97,650			—			97,650
Other operating income			—			14,106			—			14,106
Adjusted EBITDA			(1,624)			200,693			(8,422)			190,647

Balance Sheet:			June 30, 2022
(in thousands of $)			Shipping			FLNG			Corporate and other (1)			Segment assets from continuing operations			Assets held for sale			Total assets
Total assets			48,497			2,884,246			1,287,363			4,220,106			2,669			4,222,775
Equity method investments (note 16)			134,862			—			49,831			184,693			—			184,693

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			Six months ended June 30, 2021
(in thousands of $)			Shipping			FLNG			Corporate and other (1)			Total results from continuing operations
Statement of Operations:
Total operating revenues			5,690			110,134			15,281			131,105
Vessel operating expenses			(3,371)			(26,045)			(5,181)			(34,597)
Voyage, charterhire and commission expenses			(107)			(300)			(41)			(448)
Administrative expenses			(17)			(328)			(17,693)			(18,038)
Project development expenses			—			(16)			(782)			(798)
Realized gain on oil and gas derivative instruments, net (note 7)			—			2,975			—			2,975
Adjusted EBITDA			2,195			86,420			(8,416)			80,199

Balance Sheet:			December 31, 2021
(in thousands of $)			Shipping			FLNG			Corporate and other (1)			Segment assets from continuing operations			Assets held for sale			Total assets
Total assets			128,901			2,314,342			808,013			3,251,256			1,697,039			4,948,295
Equity method investments (note 16)			—			—			52,215			52,215			—			52,215

(1) Includes inter-segment eliminations arising from vessel and administrative management fees revenue between segments.

Contract assets arise when we render services in advance of receiving payment from our customers. Contract liabilities arise when the customer makes payments in advance of receiving the services. Changes in our contract balances during the period are as follows:

(in thousands of $)			Contract assets (1)			Contract liabilities (2)
Opening balance on January 1, 2022			21,778			(18,736)
Payments received for services billed in prior period			(21,769)			—
Services provided and billed in current period			118,883			—
Payments received for services billed in current period			(99,367)			—
Amortization of deferred commissioning period revenue			—			2,043
Closing balance on June 30, 2022			19,525			(16,693)

(1) Relates to management fee revenue and liquefaction services revenue, see a) and b) below.

(2) Relates to liquefaction services revenue, see b) below.

a) Management fee revenue:

The total contract asset balance above includes $0.3 million which is included in balance sheet line item “Amounts due from related parties” as of June 30, 2022.

Refer to note 21 for further details of our management fee revenue and contract terms.

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b) Liquefaction services revenue:

			Six months ended June 30,
(in thousands of $)			2022			2021
Base tolling fee (1)			102,251			102,250
Amortization of deferred commissioning period revenue billing (2)			2,043			2,043
Amortization of Day 1 gains (3) (4)			16,286			4,816
Overproduction revenue (5)			620			1,304
Incremental base tolling fee (6)			2,500			—
Other			(279)			(279)
Total			123,421			110,134

(1) The LTA bills at a base rate in periods when the oil price is $60 or less per barrel (included in “Liquefaction services revenue” in the unaudited consolidated statements of operations), and at an increased rate when the oil price is greater than $60 per barrel (recognized as a derivative and included in “Realized and unrealized gain/(loss) on oil and gas derivative instruments” in the unaudited consolidated statements of operations, excluded from revenue).

(2) Customer billing during the commissioning period, prior to vessel acceptance and commencement of the contract term, of $33.8 million is considered an upfront payment for services. These amounts billed are deferred (included in “Other current liabilities” and “Other non-current liabilities” in the unaudited consolidated balance sheets) and recognized as part of “Liquefaction services revenue” in the consolidated statements of operations evenly over the contract term.

(3) Day 1 gain which relates to the the Brent crude oil price linked derivative initially recognized in December 2017 for $79.6 million (recognized in “Other current liabilities” and “Other non-current liabilities” in the unaudited consolidated balance sheets). This amount is amortized and recognized as part of “Liquefaction services revenue” in the unaudited consolidated statements of operations evenly over the contract term.

(4) Day 1 gain which relates to the Dutch Title Transfer Facility (“TTF”) gas price derivative initially recognized in July 2021 for $28.3 million (recognized in “Other current liabilities” and “Other non-current liabilities” in the consolidated balance sheets). This amount is amortized and recognized as part of “Liquefaction services revenue” in the unaudited consolidated statements of operations evenly over the contract term.

(5) In February 2021, we entered into Amendment 2 to the LTA with our customer, who agreed to compensate us for production in excess of contracted based capacity.

Basic earnings/(loss) per share (“EPS”)/(“LPS”) is calculated with reference to the weighted average number of common shares outstanding during the period.

The components of the numerator for the calculation of basic and diluted EPS/(LPS) are as follows:

(in thousands of $)						Six months ended June 30,
						2022			2021
Net income/(loss) net of non-controlling interests - continuing operations - basic and diluted						665,772			(78,999)
Net (loss)/income net of non-controlling interests - discontinued operations - basic and diluted						(90,558)			575,796

The components of the denominator for the calculation of basic EPS/(LPS) are as follows:

(in thousands of $)			Six months ended June 30,
			2022			2021
Basic:
Weighted average number of common shares outstanding			108,125			110,093
Dilutive:
Dilutive impact of share options and RSUs			407			197
Weighted average number of common shares outstanding			108,532			110,290

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The realized and unrealized gain on the oil and gas derivative instruments comprise the following:    

			Six months ended June 30,
			2022			2021
Realized gain on Hilli gas derivative instrument			55,682			—
Realized gain on Hilli oil derivative instrument			50,102			2,975
Realized mark-to-market (“MTM”) loss on commodity swap derivatives			(8,134)			—
Realized gain on oil and gas derivative instruments, net			97,650			2,975
Unrealized gain on Hilli gas derivative instrument (note 17)			194,632			—
Unrealized gain on Hilli oil derivative instrument (note 17)			169,293			81,190
Unrealized MTM adjustment for commodity swap derivatives			(14,318)			—
Unrealized gain on oil and gas derivative instruments, net			349,607			81,190
Realized and unrealized gain on oil and gas derivative instruments (note 20)			447,257			84,165

The realized gain on oil and gas derivative instruments results from monthly billings above the original Hilli base tolling fee and the exercised incremental capacity increase under the LTA (as amended by Amendment 3 to the LTA) whereas the unrealized gain/(loss) on gas derivative instruments results from movements in forecasted natural gas prices and Euro/USD exchange rates.

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Gains on derivative instruments, net comprise the following:

(in thousands of $)			Six months ended June 30,
			2022			2021
Unrealized MTM adjustment for interest rate swaps			49,582			16,804
Interest expense on undesignated interest rate swaps			(1,705)			(562)
Foreign exchange gain on terminated undesignated foreign exchange swaps			—			240
Gains on derivative instruments, net			47,877			16,482

Other financial items, net comprise the following:

(in thousands of $)			Six months ended June 30,
			2022			2021
Financing arrangement fees and other costs			(5,964)			(94)
Amortization of debt guarantee			1,341			1,326
Foreign exchange gain/(loss) on operations			1,145			(496)
Others			(129)			(150)
Other financials items, net			(3,607)			586

Rental income

The components of operating lease income are as follows:

(in thousands of $)			Six months ended June 30,
			2022			2021
Operating lease income (1)			2,408			5,690
Variable lease income (1) (2)			827			—
Total operating lease income			3,235			5,690

(1) Total operating lease income is included in the income statement line-item “Time and voyage charter revenues”.

(2) “Variable lease income” is excluded from lease payments that comprise the minimum contractual future revenues from non-cancellable operating leases.

11.1 The CoolCo Disposal

On January 26, 2022, we entered into a share purchase agreement and related agreements with CoolCo, as amended on February 25, 2022 (the “Vessel SPA”), pursuant to which CoolCo acquired all of the outstanding shares of nine of our wholly-owned subsidiaries. Eight of these entities, Golar Hull M2021 Corp., Golar Hull M2022 Corp., Golar Hull M2027 Corp., Golar LNG NB12 Corporation, Golar LNG NB10 Corporation, Golar Hull M2047 Corp., Golar Hull M2048 Corp., and Golar LNG NB11 Corporation are each the registered or disponent owner of the following modern LNG carriers: Golar Seal, Golar Crystal, Golar Bear, Golar Frost, Golar Glacier, Golar Snow, Golar Ice and Golar Kelvin. The Cool Pool Limited is the entity responsible for the marketing of these LNG carriers. The purchase price agreed for each LNG carrier recognized as an asset in the respective subsidiaries was stated as $145.0 million, subject to working capital and debt adjustments arising from the residual balances of each wholly owned subsidiary as of the respective completion date of each subsidiary disposal.

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On January 26, 2022, we also entered into the Transitional Services Agreement (the “CoolCo TSA”) with CoolCo, pursuant to which we agreed to provide corporate administrative services to CoolCo for a fixed daily fee for a one year term; a loan agreement, pursuant to which we made a $25.0 million revolving credit facility available to CoolCo for a 24 month term for CoolCo to fund its working capital requirements; and an agreement in principle with CoolCo that, following the conclusion of an internal restructuring of our management business, CoolCo will acquire the management entities that are responsible for the commercial and technical vessel management of the LNG carriers acquired by CoolCo and the LNG carriers and FSRU that Golar has been managing for third parties (the “ManCo Agreement”, or our shipping and FSRU management business).

On January 27, 2022, CoolCo raised $275.0 million of proceeds, $150.0 million of which was subscribed by EPS Ventures LTD (“EPS”) and $125.0 million in exchange for shares in CoolCo in the Norwegian markets, following which EPS, which is wholly owned by Quantum Pacific Shipping Ltd (“QPSL”), became the largest CoolCo shareholder with the acquisition of 15,000,000 shares. In February 2022, CoolCo's shares commenced trading on the Euronext Growth Oslo with the ticker “COOL”. On February 17, 2022, CoolCo entered into a new term loan facility of up to $570.0 million, to refinance outstanding vessel debt that it had acquired, except for the sale and leaseback financing in relation to the Golar Ice and the Golar Kelvin, which CoolCo assumed.

Each subsidiary disposal was closed with phased completion dates corresponding with the date that the respective subsidiary debt was either refinanced (for six of the subsidiaries disposed of) or assumed by CoolCo (for two of the subsidiaries disposed of, for which lender consent was obtained for the change of control of the existing lease financing arrangements) and customary conditions precedent were met. The disposals closed in stages from March 3, 2022 to April 5, 2022, the date on which the Vessel SPA in its entirety was considered completed. Following completion of the Vessel SPA on April 5, 2022, EPS owned a 37.5% interest in CoolCo, we owned a 31.3% interest in CoolCo, and the remaining 31.3% was held by the public. GLNG agreed to remain as the guarantor of the payment obligations of two of the disposed subsidiaries' debt relating to LNG carriers, Golar Ice and Golar Kelvin, in exchange for a guarantee fee of 0.5% on the outstanding principal balances.

Following closing of the Vessel SPA, we continued to provide commercial and technical management to CoolCo for the eight LNG carriers it acquired pursuant to management agreements entered into contemporaneously with the Vessel SPA.

On June 30, 2022, once we had we had completed an internal reorganization, we entered into a share purchase agreement and related agreements (“ManCo SPA”) with CoolCo for its purchase of our shipping and FSRU management business, as was contemplated in the ManCo Agreement. We also entered into an Administrative Services Agreement, which replaced the CoolCo TSA (the “CoolCo ASA”), for the provision of the following services from July 1, 2022 to June 30, 2023: IT services, accounting services, treasury services, finance operations services, and any additional services reasonably required by CoolCo.

As of June 30, 2022, following completion of the CoolCo Disposal, we owned a 31.3% interest in CoolCo. We consider that we have a significant influence over CoolCo and therefore, we account for our investment in CoolCo using the equity method of accounting. As of June 30, 2022, EPS's ownership in CoolCo increased to 40.0% and the remaining 28.7% was held by the public.

The disposals to CoolCo are considered a disposal group and the associated assets and liabilities of the disposal group were classified as held-for-sale and qualified as a discontinued operation on March 1, 2022. Consequently, we retrospectively reclassified the results of the disposal group and separately presented as “Net income/(loss) from discontinued operations”. Each of the subsidiaries were de-recognized on the respective dates of each disposal with a corresponding recognition of a (loss)/gain on disposal.

The discontinued operations were previously included in two of our three segments, “Shipping” (containing the business activities of the LNG carriers and The Cool Pool Limited), and “Corporate and Other” (containing our shipping and FSRU management business).

Our continuing involvement with the discontinued operations of the disposal group includes:

•our equity method investment in CoolCo (note 16);

•the financial guarantees we provide to CoolCo with respect to the debt assumed by CoolCo related to the Golar Kelvin and Golar Ice, in place until the earlier of the repayment of the vessel debt by CoolCo or until release by the lessors (note 21);

•$25.0 million revolving credit facility committed per the loan agreement to be made available until January 2024 (note 21);

•CoolCo's management of our LNG carrier Golar Arctic and FSRU Golar Tundra, which we are chartering in for a short period of time (further disclosed in note in 11.2 – The TundraCo Disposal below);

•our agreements with CoolCo that sub-contract our contractual vessel management obligations for the LNG Croatia pursuant to our Operation and Maintenance Agreement with LNG Hrvastska d.o.o. (the “O&M Agreement”) and for New Fortress Energy Inc.'s (“NFE's”) fleet of vessels (further disclosed in note in 11.3 Disposal of Golar Partners and Hygo below); and

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•our provision of IT services, accounting services, treasury services, finance operation services, and any additional services reasonably acquired pursuant to the CoolCo ASA.

For the six months ended June 30, 2022, we:

•earned ship management and administrative services fees amounting to $2.4 million;

•earned debt guarantee fees amounting to $0.3 million. As of June 30, 2022, we guaranteed $226.9 million of CoolCo's lease obligations;

•earned commitment fees on the undrawn revolving credit facility amounting to $0.1 million; and

•incurred net pooling expenses relating to the CoolCo's vessels participation in the Cool Pool amounted to $2.0 million.

The following table contains the line-items of the CoolCo Disposal discontinued operations:

			Six months ended June 30,
(in thousands of $)			2022			2021
Time and voyage charter revenues			37,289			83,274
Vessel and other management fees			1,432			—
Vessel operating expenses			(8,466)			(23,500)
Voyage, charterhire and commission expenses			(1,229)			(3,215)
Administrative expenses			1,757			(380)
Project development expenses			(62)			(124)
Depreciation and amortization			(5,745)			(21,718)
Impairment of long-lived assets (1)			(218,349)			—
Other operating income			4,374			2,770
Operating (loss)/income			(188,999)			37,107
Other non-operating losses			—			(31)
Interest income			4			4
Interest expense			(4,725)			(11,205)
Other financial items, net			(787)			(171)
Income taxes			(385)			(139)
(Loss)/income from discontinued operations			(194,892)			25,565
Loss on disposal of discontinued operations (2)			(10,060)			—
Net (loss)/income from discontinued operations			(204,952)			25,565

(1) Impairment of long-live assets relates to the impairment expense of vessels recognized in accordance with ASC 360 Property, plant and equipment, following their classification as held-for-sale.

(2) Loss on disposal of discontinued operations comprised of carrying values of the assets and liabilities disposed of $355.4 million, partially offset by the proceeds received of $218.2 million cash consideration and $127.1 million of equity consideration which consisted of CoolCo shares.

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The following table contains the financial statement line-items forming the assets and liabilities classified as held for sale:

(in thousands of $)			December 31, 2021
ASSETS
Current assets
Cash and cash equivalents			33,811
Restricted cash and short-term deposits			43,311
Trade accounts receivable			767
Other current assets			1,913
Total current assets held for sale			79,802
Non-current assets
Restricted cash			780
Vessels and equipment, net			1,383,656
Other non-current assets			478
Total non-current assets held for sale			1,384,914
Total assets held for sale			1,464,716
LIABILITIES
Current liabilities
Current portion of long-term debt and short-term debt			(338,501)
Trade accounts payables			(7,265)
Accrued expenses			(59,094)
Other current liabilities			(11,572)
Total current liabilities held for sale			(416,432)
Non-current liabilities
Long-term debt			(292,322)
Other non-current liabilities			(11,778)
Total non-current liabilities held for sale			(304,100)
Total liabilities held for sale			(720,532)

We retain an investment accounted for under the equity method in discontinued operations. Prior to the CoolCo Disposal we held a 100% interest CoolCo and the thirteen subsidiaries disposed of. As of June 30, 2022, we held a 31.3% interest in CoolCo and no interest in the thirteen subsidiaries disposed (note 16).

The table below summarizes the financial performance of CoolCo on a 100% basis:

			Six months ended June 30,
(in thousands of $)			2022			2021
Revenue			100,743			83,274
Adjusted EBITDA			67,000			58,825
Net income			40,903			25,565

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11.2 The TundraCo Disposal

On May 31, 2022 we entered into a share purchase agreement with Snam pursuant to which it acquired 100% of the share capital of our subsidiary Golar LNG NB 13 Corporation, owner of FSRU Golar Tundra for $352.5 million (which includes a $2.5 million working capital adjustment). The assets and liabilities of the Golar Tundra met the criteria for presentation as held-for-sale and also qualified as a discontinued operation on May 30, 2022. Consequently, we retrospectively reclassified the results of the Golar Tundra and separately presented as “Net income/(loss) from discontinued operations”. The discontinued operations were previously included in the “Shipping” segment.

Our continuing involvement with the discontinued operations of the Golar Tundra includes:

•bareboat agreement to charter the Golar Tundra for 160 days;

•incurred pool expenses from other participants in the pooling arrangement totaling $0.1 million; and

•a development agreement (for the provision of engineering, design, procurement, modification, installation and commissioning services of the Golar Tundra) which was contemplated but not executed as of June 30, 2022.

For the six months ended June 30, 2022, we accrued $0.8 million of bareboat expenses.

The following table contains the line-items of the discontinued operation:

			Six months ended June 30,
(in thousands of $)			2022			2021
Time and voyage charter revenues			13,575			15,734
Vessel operating expenses			(2,821)			(4,030)
Voyage, charterhire and commission expenses			(3,681)			(6,067)
Administrative expenses			(1)			(24)
Depreciation and amortization			(2,955)			(3,546)
Operating income			4,117			2,067
Interest income			—			2
Interest expense			(4,649)			(1,241)
Other financial items, net			(167)			(118)
(Loss)/income from discontinued operations			(699)			710
Gain on disposal of discontinued operations (1)			123,299			—
Net income from discontinued operations			122,600			710

(1) Gain on disposal of discontinued operations comprised of (i) cash proceeds received of $350.0 million, (ii) working capital adjustment of $2.5 million, (iii) a partial offset by our investment in Golar LNG NB 13 Corporation of $229.0 million and (iv) fees incurred in relation to disposal of $0.2 million.

The following table contains the financial statement line-items forming the assets and liabilities classified as held for sale:

(in thousands of $)			June 30, 2022			December 31, 2021
ASSETS
Current assets
Cash and cash equivalents			36			2,605
Trade accounts receivable			1			70
Other current assets			2,632			153
Total current assets held for sale			2,669			2,828
Non-current assets
Vessels and equipment, net			—			229,495
Total non-current assets held for sale			—			229,495
Total assets held for sale			2,669			232,323
LIABILITIES

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(in thousands of $)			June 30, 2022			December 31, 2021
Current liabilities
Current portion of long-term debt and short-term debt			—			(9,911)
Trade accounts payables			(210)			(204)
Accrued expenses			(1,245)			(737)
Other current liabilities			—			(2,325)
Total current liabilities held for sale			(1,455)			(13,177)
Non-current liabilities
Long-term debt			—			(145,768)
Total non-current liabilities held for sale			—			(145,768)
Total liabilities held for sale			(1,455)			(158,945)

11.3 Disposal of Golar Partners and Hygo

On April 15, 2021, we completed the sale of our investments in Golar LNG Partners (“Golar Partners”) and Hygo Energy Transition Ltd (“Hygo”) to NFE. We received consideration of $876.3 million which comprised of (i) $80.8 million cash for our investment in Golar Partners and (ii) $50.0 million cash and 18.6 million Class A NFE common shares (“NFE Shares”) valued at $745.4 million for our investment in Hygo (the “GMLP Merger” and “Hygo Merger”, respectively).

The net income of equity method investments from discontinued operations for the period ended April 15, 2021 is as follows:

(in thousands of $)			Period ended April 15, 2021
Net income from equity method investments of Golar Partners			8,116
Net losses from equity method investments of Hygo			(15,008)
Loss from discontinued operations			(6,892)
Gain on disposal of equity method investments(1)			575,056
Net income from discontinued operations			568,164

(1) Gain on disposal of discontinued operations comprised of (i) proceeds received of $876.3 million; (ii) release of our tax indemnity guarantee liability to Golar Partners of $2.1 million; (iii) a partial offset by the carrying values of our investment in affiliates disposed of $257.2 million as of April 15, 2021; (iv) realized accumulated comprehensive losses on disposal of investment in affiliates of $43.4 million; and (v) fees incurred in relation to disposals of $2.6 million.

Golar Partners and Hygo Post-Merger Services Agreements

Upon completion of the GMLP Merger and the Hygo Merger, we entered into certain transition services agreements, corporate services agreements, ship management agreements and omnibus agreements with Golar Partners, Hygo and NFE. These agreements replaced the previous management and administrative services agreements, ship management agreements and guarantees that Golar provided to Golar Partners and Hygo.

For the six months ended June 30, 2022, we:

•earned ship management and administrative services fees amounting to $7.0 million;

•incurred pool income from other participants in the pooling arrangement totaling $0.5 million;

•declared distributions on Golar Hilli LLC (“Hilli LLC”) amounting to $14.9 million with respect to the common units owned by Golar Partners and accounted for $2.1 million of Hilli costs indemnification; and

•earned charter and debt guarantee fees from Golar Partners and Hygo amounting to $1.0 million. As of June 30, 2022, we guaranteed $372.2 million of Hygo's gross long-term debt obligations.

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12.1 Lessor VIEs

As of June 30, 2022, we leased one (December 31, 2021: eight) vessel(s) from a VIE as part of sale and leaseback agreements. Our continuing lessor VIE as of June 30, 2022, following the disposals of certain vessels and associated lessor VIEs to CoolCo, is with a China State Shipbuilding Corporation entity (the “CSSC” entity). The CSSC entity is a wholly-owned, newly formed special purpose vehicle (“Lessor SPV”). In this transaction, we sold our vessel and then subsequently leased back the vessel on a bareboat charter for a term of ten years. We have an option to repurchase the vessel at a fixed predetermined amount during its charter period and an obligation to repurchase the vessel at the end of the vessel's lease period. As further discussed in note 11, during the six months ended June 30, 2022, the Vessel SPA resulted in the disposal of eight of our subsidiaries, being the disponent owners of seven vessels (Golar Seal; Golar Crystal, Golar Bear, Golar Glacier, Golar Snow, Golar Ice and Golar Kelvin).

Refer to note 5 to our consolidated financial statements filed with our 2021 Annual Report, for additional details.  

 

A summary of our payment obligations (excluding repurchase options and obligations) under the bareboat charter with the lessor VIE as of June 30, 2022, is shown below:

(in thousands of $)			2022 (1)			2023			2024			2025			2026			2027+
Hilli (2)			56,831			110,019			105,459			100,673			96,000			113,414

(1) For the six months ending December 31, 2022.

(2) The payment obligations above include variable rental payments due under the lease based on an assumed LIBOR plus margin.

The assets and liabilities of the lessor VIE that most significantly impact our unaudited consolidated balance sheet as of June 30, 2022 and December 31, 2021, are as follows:

(in thousands of $)						June 30, 2022			December 31, 2021
Assets
Restricted cash and short-term deposits						16,735			16,523
Liabilities
Debt:
Current portion of long-term debt and short-term debt (1)						(359,572)			(380,554)
Long-term debt (1)						(186,808)			(216,313)
						(546,380)			(596,867)

(1) Where applicable, these balances are net of deferred finance charges.

The most significant impact of the lessor VIE's operations on our unaudited consolidated statements of operations, and unaudited consolidated statements of cash flows are as follows:

(in thousands of $)			Six months ended June 30,
			2022			2021
Continuing operations
Statement of operations
Interest expense			2,878			2,752
Statement of cash flows
Net debt repayments			(50,570)			(49,704)
Net debt receipts			—			1,513

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(in thousands of $)			Six months ended June 30,
			2022			2021
Discontinued operations
Statement of operations
Interest expense			3,814			10,976
Statement of cash flows
Net debt repayments			—			(44,149)
Net debt receipts			—			9,850
Financing costs paid			—			(350)

12.2    Golar Hilli LLC

Following the sale of common units in Golar Hilli LLC (“Hilli LLC”), we have retained sole control over the most significant activities and the greatest exposure to variability in residual returns and expected losses from the Hilli. Accordingly, management has concluded that Hilli LLC is a VIE and that we are the primary beneficiary.

Summarized financial information of Hilli LLC

The assets and liabilities of Hilli LLC(1) that most significantly impact our unaudited consolidated balance sheet are as follows:

(in thousands of $)			June 30, 2022			December 31, 2021
Balance sheet
Current assets			105,809			157,643
Non-current assets			1,693,094			1,280,217
Current liabilities			(394,467)			(444,352)
Non-current liabilities			(242,814)			(270,371)

(1) As Hilli LLC is the primary beneficiary of the Hilli Lessor VIE (see above) the Hilli LLC balances include the Hilli Lessor VIE.

The most significant impact of Hilli LLC VIE's operations on our unaudited consolidated statements of income, and unaudited consolidated statements of cash flows, are as follows:

(in thousands of $)			Six months ended June 30,
			2022			2021
Statement of operations
Liquefaction services revenue			123,421			110,134
Realized and unrealized gain on oil and gas derivative instruments			447,257			84,165
Statement of cash flows
Net debt repayments			(50,570)			(49,704)
Net debt receipts			—			1,513
Cash dividends paid			(25,305)			(16,702)

12.3    Gimi MS Corporation

Following the closing of the sale of 30% of the common units of Gimi MS Corporation (“Gimi MS”) to First FLNG Holdings in April 2019, we have determined that (i) Gimi MS is a VIE, (ii) we are the primary beneficiary and retain sole control over the most significant activities and the greatest exposure to variability in residual returns and expected losses from the Gimi. Thus, Gimi MS continues to be consolidated into our financial statements.

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Summarized financial information of Gimi MS

The assets and liabilities of Gimi MS that most significantly impact our unaudited consolidated balance sheet are as follows:

(in thousands of $)			June 30, 2022			December 31, 2021
Balance sheet
Current assets			235			7,107
Non-current assets			1,093,723			877,835
Current liabilities			(18,340)			(18,127)
Non-current liabilities			(515,236)			(389,244)

The most significant impact of Gimi MS VIE's operations on our unaudited consolidated statements of cash flows, is as follows:

(in thousands of $)			Six months ended June 30,
			2022			2021
Statement of cash flows
Additions to asset under development			175,230			168,392
Capitalized financing costs			(2,080)			(3,259)
Net debt receipts			125,000			110,000
Proceeds from subscription of equity interest			11,270			12,812

Our restricted cash and short-term deposits balances are as follows:

(in thousands of $)			June 30, 2022			December 31, 2021
Restricted cash in relation to the Hilli (1)			60,817			60,720
Restricted cash and short-term deposits held by lessor VIEs (note 12)			16,735			16,523
Restricted cash in relation to the LNG Croatia (2)			11,344			11,328
Restricted cash related to Hygo performance guarantee (3)			1,502			1,500
Restricted cash relating to office lease			1,068			2
Restricted cash in relation to liability on legacy UK tax leases (4)			—			16,000
Total restricted cash and short-term deposits			91,466			106,073
Less: Amounts included in current restricted cash and short-term deposits			(18,238)			(34,025)
Long-term restricted cash			73,228			72,048

(1) In November 2015, in connection with the issuance of a $400 million letter of credit (“LC”) by a financial institution to the customer of the FLNG Hilli, we recognized an initial cash collateral of $305.0 million to support the Hilli performance guarantee. Under the provisions of the LC, the terms allow for a stepped reduction in the value of the guarantee over time and thus, a concurrent reduction in the cash collateral requirements. In May 2021, once the Hilli reached 3.6 million tonnes of LNG production, the LC was reduced to $100 million and the cash collateral to $60.8 million.

(2) In connection with the O&M Agreement, we are required to maintain a performance guarantee of €9.3 million and $1.3 million, which will remain restricted throughout the 10-year term of the O&M Agreement.

(3) In connection with the disposal of Hygo, we provided a $1.5 million performance guarantee to the senior lenders of Centrais Eléctricas de Sergipe S.A. (“CELSE”) to enable the lenders to waive their requirement for consent in the event of a change of control and extend the technical completion date.

(4) The lessor of our six legacy UK leases had a first priority security interest in relation to the Golar Gandria and second priority interests in relation to the Golar Tundra and Golar Frost with cash collateral of $16.0 million. Upon reaching a settlement in April 2022, this was released (note 22).

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(in thousands of $)			June 30, 2022			December 31, 2021
Investment in listed equity securities (1)			491,754			450,225
TTF swap collateral (2)			13,520			6,940
Prepaid expenses			4,278			2,745
Gas derivative instrument (note 20)			—			79,578
MTM commodity swap valuation (note 20)			—			1,753
Other receivables			2,851			2,558
Other current assets			512,403			543,799

(1) “Investment in listed equity securities” relates to our 12.4 million NFE Shares (December 31, 2021: 18.6 million NFE Shares). The balance as at December 31, 2021 includes a $0.6 million dividend receivable (June 30, 2022: $nil) which is presented in the income statement line-item “Other non-operating income/(losses)”.

Gimi conversion

In February 2019, we entered into a lease and operate agreement with BP Mauritania Investments LTD (“BP”) for the employment of a FLNG, the Gimi, after conversion to an FLNG for a term of 20-years (the “LOA”). In April 2019, we completed the sale of 30% of the total issued ordinary share capital of Gimi MS to First FLNG Holdings. In October 2020, we announced that we had confirmed a revised project schedule with BP which extended the target connection date by 11 months to 2023. In June 2022, we agreed to a $50 million incentive payment to Keppel Shipyard Limited (“Keppel Shipyard”) for initiatives to safeguard sail away within first half of 2023. The aggregated conversion cost including financing cost is approximately $1.7 billion of which $700 million is funded by the Gimi facility (note 18).

As of June 30, 2022, the estimated timing of the outstanding payments in connection with the Gimi conversion are as follows:

(in thousands of $)
Period ending December 31,
2022 (1)			190,704
2023			296,587
2024			122,425
			609,716

(1) For the six months ending December 31, 2022

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			Six months ended June 30,
(in thousands of $)			2022			2021
Share of net income of CoolCo			5,390			—
Share of net income of ECGS			156			4
Share of net (losses)/income of Avenir			(2,537)			153
Net income from equity method investments			3,009			157

The carrying amounts of our equity method investments as of June 30, 2022 and December 31, 2021 are as follows:

(in thousands of $)			June 30, 2022			December 31, 2021
CoolCo (note 11)			134,862			—
Avenir			45,376			47,913
ECGS			4,455			4,302
Equity method investments			184,693			52,215

Other non-current assets comprise the following:

(in thousands of $)			June 30, 2022			December 31, 2021
Oil derivative instrument (note 20)			296,773			127,480
Gas derivative instrument (note 20)			268,857			—
MTM interest rate swaps valuation (note 20)			32,283			—
Operating lease right-of-use-assets			6,537			10,513
Other			5,713			3,672
Other non-current assets			610,163			141,665

As of June 30, 2022 and December 31, 2021, our debt was as follows:

(in thousands of $)			June 30, 2022			December 31, 2021
Gimi facility			(535,000)			(410,000)
Norwegian Bonds			(299,480)			(299,403)
Golar Arctic facility			(25,531)			(29,178)
2017 Convertible Bonds			—			(315,646)
Subtotal (excluding lessor VIE debt)			(860,011)			(1,054,227)
CSSC VIE debt - Hilli facility (1)			(546,710)			(597,280)
Total debt (gross)			(1,406,721)			(1,651,507)
Less: Deferred financing costs			24,444			28,207
Total debt, net of deferred financing costs			(1,382,277)			(1,623,300)

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At June 30, 2022, our debt, net of deferred financing costs, is broken down as follows:

			Golar debt			VIE debt (1)			Total debt
(in thousands of $)
Current portion of long-term debt and short-term debt			(7,219)			(359,572)			(366,791)
Long-term debt			(828,678)			(186,808)			(1,015,486)
Total			(835,897)			(546,380)			(1,382,277)

(1) This amount relates to the lessor VIE (for which legal ownership resides with a financial institution) that we are required to consolidate under U.S. GAAP (see note 12).

2017 Convertible Bonds

In February 2017, we closed a $402.5 million aggregate principal amount of 2.75% convertible senior unsecured notes due 2022 (“2017 Convertible Bonds”). In February 2022, we fully redeemed the outstanding notional value of our 2017 Convertible Bonds, inclusive of interest, amounting to $321.7 million.

Golar Tundra facility

In December 2021, we entered into a secured loan facility for $182.0 million (“the Golar Tundra Facility”). The Golar Tundra facility bears interest at LIBOR plus a margin of 3% and is repayable over a term of five years. In May 2022, concurrent with the sale of the Golar Tundra to Snam, we repaid in full the Golar Tundra Facility, including accrued interests.

Corporate RCF

In November 2021, we executed a $200.0 million revolving facility (the “Corporate RCF”) which has a term of three years. The Corporate RCF bears interest at LIBOR plus a margin of 2.8% and is secured against our NFE Shares (note 14). Under the terms of the facility, we are permitted to release a portion of the pledged NFE Shares in accordance with the prescribed loan to value ratio based on the then-current market value of such NFE Shares. In February 2022, we had drawn $131.0 million of the available funds, which we repaid in May 2022. As of June 30, 2022, the facility remains undrawn and available for use.

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Fair values

We recognize our fair value estimates using a fair value hierarchy based on the inputs used to measure fair value. The fair value hierarchy has three levels based on reliability of inputs used to determine fair value as follows:

Level 1: Quoted market prices in active markets for identical assets and liabilities.

Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data.

Level 3: Unobservable inputs that are not corroborated by market data.

The carrying values and estimated fair values of our financial instruments at June 30, 2022 and December 31, 2021 are as follows:

						June 30, 2022						December 31, 2021
(in thousands of $)			Fair value hierarchy			Carrying value			Fair value			Carrying value			Fair value
Non-Derivatives:
Cash and cash equivalents (1)			Level 1			528,798			528,798			232,211			232,211
Restricted cash and short-term deposits (2)			Level 1			91,466			91,466			106,073			106,073
Trade accounts receivable (3)			Level 1			54,380			54,380			28,912			28,912
Investment in listed equity securities (4)			Level 1			491,754			491,754			449,666			449,666
Trade accounts payable (3)			Level 1			(18,959)			(18,959)			(4,936)			(4,936)
Assets held for sale (note 11)			Level 2			2,669			2,669			1,697,039			1,697,039
Liabilities held for sale (note 11)			Level 2			(1,455)			(1,455)			(879,477)			(879,477)
Current portion of long-term debt and short-term debt (5) (6) (7)			Level 2			(367,004)			(367,004)			(388,005)			(388,005)
Current portion of 2017 Convertible Bonds (6) (8)			Level 2			—			—			(315,646)			(316,561)
Long-term debt (6) (7)			Level 2			(740,236)			(740,236)			(947,855)			(947,855)
Long-term debt - Norwegian Bonds (6) (8)			Level 1			(299,480)			(281,517)			—			—
Derivatives:
Oil and gas derivative instruments (9) (10)			Level 2			565,630			565,630			207,058			207,058
Interest rate swaps asset (9) (11) (12)			Level 2			32,283			32,283			—			—
Interest rate swaps liability (9) (11) (12)			Level 2			—			—			(17,300)			(17,300)
Commodity swap asset (9) (11)			Level 2			—			—			1,753			1,753
Commodity swap liability (9) (11)			Level 2			(12,653)			(12,653)			(88)			(88)

(1) The carrying value of cash and cash equivalents, which are highly liquid, is a reasonable estimate of fair value.

(2) The carrying value of restricted cash and short-term deposits is considered to be equal to the estimated fair value because of their near term maturity.

(3) The carrying values of trade accounts receivable and trade accounts payable approximate fair values because of the near term maturity of these instruments.

(4) “Investment in listed equity securities” refers to our NFE Shares (note 14). The fair value was calculated using the NFE closing share price as of June 30, 2022, resulting in a valuation of $491.8 million and a realized and unrealized gain of $295.0 million (June 30, 2021: Realized and unrealized loss of $86.7 million).

(5) The carrying amounts of our short-term debt approximate their fair values because of the near term maturity of these instruments.

(6) Our debt obligations are recorded at amortized cost in the unaudited consolidated balance sheets. The amounts presented in the above table are gross of the deferred charges amounting to $24.4 million and $28.2 million at June 30, 2022 and December 31, 2021, respectively.

(7) The estimated fair values for both the floating long-term debt and short-term debt are considered to be equal to the carrying value since they bear variable interest rates, which are adjusted on a quarterly or six-monthly basis.  

(8) The estimated fair values of the unsecured 2017 Convertible Bonds and our $300.0 million senior unsecured bonds (the “2021 Norwegian Bonds”) are based on their quoted market prices as of the balance sheet date. In February 2022, following the listing of the 2021 Norwegian Bonds, the fair value hierarchy had been transferred from level 2 to level 1.

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(9) Derivative assets are generally captured within other current assets and non-current assets; oil and gas derivative liabilities are captured within other current liabilities and non-current liabilities; and interest rates and commodity swap derivative liabilities are captured within other current liabilities on the balance sheet.

(10) The fair value of the oil and gas derivative instruments was determined using the estimated discounted cash flows of the additional payments due to us as a result of oil prices moving above a contractual oil price floor over the term of the LTA (Brent crude oil price linked) and the estimated discounted cash flows of the additional payments due to us until the end of the contract in 2026 as a result of gas prices moving with respect to the contractual pricing terms per the Amendment 3 to the LTA and the Euro/USD exchange rates based on the forex forward curve (TTF price linked). Significant inputs used in the valuation of the oil and gas derivative instruments include management’s estimate of an appropriate discount rate and the length of time necessary to blend the long-term and short-term oil and gas prices obtained from quoted prices in active markets.

(11) The fair value of certain derivative instruments is the estimated amount that we would receive or pay to terminate the agreements at the reporting date, taking into account current interest rates, foreign exchange rates, closing quoted market prices and our creditworthiness and that of our counterparties.

(12) The credit exposure of interest rate swap agreements is represented by the fair value of contracts with a positive value at the end of each period, reduced by the effects of master netting arrangements. It is our policy to enter into master netting agreements with counterparties to derivative financial instrument contracts, which give us the legal right to discharge all or a portion of the amounts owed to the counterparty by offsetting them against amounts that the counterparty owes to us.

As of June 30, 2022, we were party to the following interest rate swap transactions involving the payment of fixed rates in exchange for LIBOR as summarized below:

Instrument (in thousands of $)			Notional value			Maturity dates			Fixed interest rates
Interest rate swaps:
Receiving floating, pay fixed			550,000			2024 to 2029			1.69% - 2.37%

Commodity price risk management

A derivative asset, representing the fair value of the estimated discounted cash flows of payments due as a result of the Brent crude oil price moving above the contractual floor of $60.00 per barrel over the contract term, was recognized in December 2017 following the effectiveness of Amendment 3 to the LTA. Golar bears no downside risk should the Brent crude oil price fall below $60.00.

The 2022 Incremental Capacity for the Hilli is linked to TTF gas prices. As of June 30, 2022, we were party to a commodity swap involving the payment of fixed prices in exchange for Dutch natural gas to manage our exposure to the TTF gas prices volatility, as summarized below:

Instrument			Notional quantity (MMBtu)			Maturity date			Fixed price/MMBtu
Commodity swap derivatives:
Receiving fixed, pay floating			806,502			2022			$23.25 to $27.50

It is our policy to enter into master netting agreements with the counterparties to derivative financial instrument contracts, which give us the legal right to discharge all or a portion of amounts owed to the counterparty by offsetting them against amounts that the counterparty owes to us. We have elected not to offset the fair values of derivative assets and liabilities executed with the same counterparty that are generally subject to enforceable master netting arrangements. As a result, the amounts presented in our unaudited consolidated balance sheet in relation to interest rate and commodity swaps have not been offset. For our commodity swaps, if we were to offset and record the asset and liability balances of derivatives on a net basis, the amounts presented in our unaudited consolidated balance sheets as of June 30, 2022 and December 31, 2021 would be adjusted in the following table:

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a) Transactions with CoolCo:

As further described in note 11, on June 30, 2022, we completed the CoolCo Disposal. As of June 30, 2022, we recognized an investment in CoolCo of $134.9 million, representing our 31.3% interest (note 16) and entered into the following transactions:

Net revenues: The transactions as a result of the CoolCo Disposal for the six months ended June 30, 2022 consisted of the following:

			Six months ended June 30,
(in thousands of $)			2022
Management and administrative services revenue (1)			1,160
Ship management fees revenue (2)			1,249
Debt guarantee compensation (3)			279
Commitment fee (4)			54
Total			2,742

(1) Management and administrative services revenue – Golar Management Limited (“Golar Management”), a wholly-owned subsidiary of Golar, and Golar Management (Bermuda) Ltd, entered into the CoolCo TSA pursuant to which we provided corporate administrative services to CoolCo. On June 30, 2022, upon completion of the CoolCo Disposal, the CoolCo TSA was replaced by the CoolCo ASA.

(2) Ship management fees – We provided commercial and technical management to the LNG carriers that had been disposed under existing management agreements, however the CoolCo TSA revised the annual management fee payable to us per vessel. On June 30, 2022, upon completion of the CoolCo Disposal, the ship management agreements terminated.

(3) Debt guarantee compensation – We agreed to remain as the guarantor of the payment obligations of two of the disposed subsidiaries' debt relating to two LNG carriers, Golar Ice and Golar Kelvin, in exchange for a guarantee fee of 0.5% on the outstanding principal balances, which as of June 30, 2022 is $226.9 million. The compensation amounted to $0.3 million for the six months ended June 30, 2022.

(4) Commitment fee – We advanced a two year revolving credit facility of $25.0 million to CoolCo, which remains undrawn as of June 30, 2022. The facility bears a fixed interest rate and commitment fee on the undrawn loan of 5% and 0.5% per annum, respectively. The commitment fee amounted to $0.1 million for the six months ended June 30, 2022.

Receivables: The balances with CoolCo and its subsidiaries as of June 30, 2022 consisted of the following:

(in thousands of $)			June 30, 2022
Balance due from CoolCo and subsidiaries (5)			3,221

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(5) Balances due from CoolCo and its subsidiaries - Amounts due to/from CoolCo and its subsidiaries are comprised primarily of unpaid management services, amounts arising from the results of CoolCo's vessels participating in the Cool Pool, short term loan and other related arrangements. Payables and receivables are generally settled quarterly in arrears. Balances owing to or due from CoolCo and its subsidiaries are unsecured, interest-free and intended to be settled in the ordinary course of business.

Other transactions:

Net Cool Pool expenses - The eight TFDE vessels sold in the CoolCo Disposal were previously managed by Golar under the terms of the Cool Pool. The net expenses relating to the CoolCo's vessels participation in the pool amounted to $2.0 million for the six months ended June 30, 2022. This is presented in our unaudited consolidated statement of operation in the line item “Net (loss)/income from discontinued operations”.

b) Transactions with existing related parties:

Net (expenses)/revenue: The transactions with other related parties for the six months ended June 30, 2022 and 2021 consisted of the following:

			Six months ended June 30,
(in thousands of $)			2022			2021
Avenir LNG (1)			148			234
Magni Partners (2)			(9)			(172)
ECGS (3)			—			1,482
Borr Drilling (4)			—			167
2020 Bulkers (5)			—			53
Total			139			1,764

Receivables: The balances with other related parties as of June 30, 2022 and December 31, 2021 consisted of the following:

(in thousands of $)			June 30, 2022			December 31, 2021
Avenir LNG (1)			3,374			3,225
Magni Partners (2)			81			81
Borr Drilling			—			149
2020 Bulkers			—			29
Total			3,455			3,484

(1) Avenir LNG Limited (“Avenir”) entered into agreements to compensate Golar in relation to the provision of certain debt guarantees relating to Avenir and its subsidiaries. This compensation amounted to $0.1 million and $0.2 million for the six months ended June 30, 2022 and 2021, respectively.

In October 2021, we advanced a one year revolving shareholder loan of $5.3 million to Avenir, of which $1.8 million was drawn as of June 30, 2022. The facility bears a fixed interest rate of 5% per annum. Interest and commitment fee receivable on the undrawn portion of the loan amounted to $44.0 thousand and $35.0 thousand for the six months ended June 30, 2022, respectively.

(2) Magni Partners - Tor Olav Trøim is the founder of, and partner in, Magni Partners (Bermuda) Limited (“Magni Partners”), a privately held Bermuda company, and is the ultimate beneficial owner of the company. Receivables and payables from Magni Partners comprise primarily of the cost (without mark-up) or part cost of personnel employed by Magni Partners who have provided advisory and management services to Golar. These costs do not include any payment for any services provided by Tor Olav Trøim himself.

(3) We chartered the Golar Ice to Eqyptian Company for Gas Services S.A.E. (“ECGS”) during the six months ended June 30, 2021. There was no comparable transaction in the same period in 2022.

(4) Borr Drilling - Tor Olav Trøim is the founder, and director of Borr Drilling Limited (“Borr Drilling”), a Bermuda company listed on the Oslo and Nasdaq stock exchanges. Receivables comprise primarily of management and administrative services provided by our Bermuda corporate office. Effective from January 2022, Borr Drilling ceased to be a related party.

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(5) 2020 Bulkers - Receivables comprise primarily of management and administrative services provided by our Bermuda corporate office. Effective from January 2022, 2020 Bulkers Ltd. (“2020 Bulkers”) ceased to be a related party.

c) Transactions with former related parties

c.1) Golar Partners and subsidiaries:

Following the completion of the GMLP Merger on April 15, 2021, Golar Partners ceased to be a related party and subsequent transactions with Golar Partners and its subsidiaries are treated as a third party and settled under normal payment terms. For the balances with Golar Partners and its subsidiaries prior to the completion of the GMLP Merger, we retrospectively adjusted the comparative period and classified them as held for sale. Furthermore, the management and administrative services agreement and ship management fee agreement were terminated and replaced with the transition services agreement, Bermuda services agreement and ship management agreements (note 11).

Net revenues: The transactions with Golar Partners and its subsidiaries for the period January 1, 2021 to April 15, 2021 consisted of the following:

			Period January 1, 2021 to April 15, 2021
(in thousands of $)			2021
Management and administrative services revenue			1,717
Ship management fees revenue			2,251
Interest income on short-term loan			18
Total			3,986

Other transactions:

During the period from January 1, 2021 to April 15, 2021 we received total distributions from Golar Partners of $0.5 million with respect to the common units and general partner units owned by us at that time.

During the period from January 1, 2021 to April 15, 2021 Hilli LLC had declared distributions totaling $7.8 million with respect of its common units owned by Golar Partners. In connection with the Hilli disposal, we agreed to indemnify Golar Partners for certain costs incurred in Hilli operations when these costs exceed a contractual ceiling. During the period from January 1, 2021 to April 15, 2021 we recognized $nil with respect to this Hilli indemnification arrangement.

c.2) Hygo and subsidiaries:

Following the completion of the Hygo Merger on April 15, 2021, Hygo ceased to be a related party and subsequent transactions with Hygo and its subsidiaries are treated as third-party transactions and settled under normal payment terms. For the balances with Hygo and its subsidiaries prior to the completion of the Hygo Merger, we retrospectively adjusted the comparative period and classified them as held for sale. Furthermore, the management and administrative services agreement and ship management fee agreement were terminated and replaced with the transition services agreement, Bermuda services agreement and ship management agreements (note 11).

Net revenues: The transactions with Hygo and its affiliates for the period January 1, 2021 to April 15, 2021 consisted of the following:

			Period January 1, 2021 to April 15, 2021
(in thousands of $)			2021
Management and administrative services revenue			2,051
Ship management fees income			904
Debt guarantee compensation			676
Total			3,631

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Other transactions:

Net Cool Pool expenses - Net expenses relating to the other pool participants are presented in our unaudited consolidated statement of operation in the line item “Voyage, charter hire and commission expenses” for the period ended April 15, 2021 amounted to $2.9 million.

Assets pledged

(in thousands of $)			June 30, 2022			December 31, 2021
Book value of vessels secured against loans (1)			1,139,855			1,242,342

(1) This excludes the Gimi which is classified as “Assets under development” (see note 15) and secured against its specific debt facility (note 18).

Corporate RCF

As of June 30, 2022, the Corporate RCF is secured by a pledge against our NFE Shares. We are permitted under the terms of the facility, to release a portion of the pledged NFE Shares in accordance with the prescribed loan to value ratio based on the then-current market value of such NFE Shares.

Capital Commitments

Gandria

We have agreed contract terms for the conversion of the Gandria to a FLNG. The Gandria is currently in lay-up awaiting delivery to Keppel Shipyard for conversion. The conversion agreement is subject to certain payments and lodging of a full Notice to proceed. We have also provided a guarantee to cover the sub-contractor's obligations in connection with the conversion of the vessel.

UK tax lease benefits

As described under note 29 in our audited consolidated financial statements filed with our 2021 Annual Report, during 2003 we entered into six UK tax leases. Under the terms of the leasing arrangements, the benefits are derived primarily from the tax depreciation assumed to be available to the lessors as a result of their investment in the vessels. As is typical in these leasing arrangements, as the lessee we were obligated to maintain the lessor’s after-tax margin. The UK tax authorities (“HMRC”) have been challenging the use of similar lease structures and had engaged in litigation of a test case. In 2021, we reached a settlement with HMRC and in April 2022, we settled our liability to the HMRC in full, resulting in a payment of $66.4 million, inclusive of fees.

Hilli 2023+ expansion option exercise

In July 2022, Perenco Cameroon S.A. (“Perenco”) and Société Nationale des Hydrocarbures (“SNH”) exercised the option to increase the utilization capacity of Hilli by up to 0.2 million tons of LNG per year from January 2023 through to the end of the current contract term in July 2026. This will increase the total annual LNG production of Hilli to 1.4 million tons from January 2023 onwards from its contracted base capacity of 1.2 million tons. The tolling fee for the 2023+ incremental capacity is linked to European gas prices at the Dutch Title Transfer Facility (“TTF”).

In August 2022, we entered into swap arrangements to hedge part of our TTF price exposure for the 2023 and 2024 incremental 0.2 million tons per annum at a fixed price of $49.50 and $51.20, respectively, per Metric Million British Thermal Unit (“MMBtu”).