Flex LNG Ltd. announced the completion of a Japanese Operating Lease with Call Option (JOLCO) financing worth $175 million for its liquefied natural gas (LNG) carrier Flex Courageous. The transaction is part of the company’s balance sheet optimisation programme presented during its Q1 2025 update.
The financing extends the vessel’s debt maturity to 2035 and reduces the annual cost of debt by approximately 1.5%. The transaction has generated about $42 million in immediate net proceeds. At the end of the first quarter, the company reported a cash position of $410 million, further strengthened by the proceeds of this refinancing.
First step of a broader plan
This refinancing marks the first step of a wider plan to restructure the financing of three vessels, all of which recently secured extended charter contracts. The company previously announced a total of 37 additional contract years across the Flex Courageous, Flex Resolute and Flex Constellation vessels. These contracts form the basis of the “Balance Sheet Optimization Program 3.0”.
The refinancings of Flex Resolute and Flex Constellation are scheduled for the second half of 2025. Flex LNG expects to generate a total of $120 million in net proceeds from all three transactions, while also reducing its overall cost of debt and extending maturities.
Strengthening financial flexibility
According to company management, the refinancing programme aims to improve capital structure and ensure long-term investment capacity. The strength of the charter backlog, supported by long-term commitments, enabled the company to secure financing on what it considers favourable terms.
“We have completed our first refinancing of 2025 on very attractive terms,” said Knut Traaholt, Chief Financial Officer of Flex LNG Management AS. “We will now turn our attention to the upcoming refinancings to further strengthen Flex LNG’s financial platform.”
