3 Min Read
* Oscar Spieler to replace Gary Smith as CEO
* In talks with pvt equity firm for power investment
* Shares rise as much as 9.4 pct (Adds analyst comment; updates shares)
By Amrutha Gayathri
May 10 (Reuters) - Golar LNG Ltd said former Chief Executive Oscar Spieler would return to the top job as the natural gas shipping company pushes deeper into the Brazilian power generation market to cope with weakness in freight rates.
Sluggish demand for LNG from key markets such as South Korea and Japan, coupled with growing supply of tankers, has hurt rates for transporting the fuel in the past couple of years.
Golar LNG said on Tuesday it was in talks with a private equity firm for investment in Golar Power, which holds an interest in a 1.5 gigawatt power station in Sergipe, Brazil.
Golar LNG shares rose as much as 9.4 percent on Tuesday.
The news comes about two months after the company's joint venture with Brazilian company GenPower Participaçoes said it had reached a preliminary deal with Exxon Mobil Corp for LNG supply to the gas-to-power project in Sergipe.
The estimated cost of Sergipe project is $1.2 billion, of which Golar LNG has to raise about 25 percent, or $300 million, Wells Fargo Securities analyst Michael Webber wrote in a note.
Spieler, who led the company between July 2009 and June 2011, will replace Gary Smith, who is stepping down. Spieler was responsible for Golar LNG's first floating liquefied natural gas project, the company said.
Golar LNG has also hired former BP Plc executive Krzysztof Zielicki to work with Schlumberger Ltd, its partner for developing stranded gas assets.
Golar LNG is developing a floating LNG project off Equatorial Guinea with Ophir Energy Plc, which was in talks with Schlumberger for sale of a 40 percent stake in the project. However, Ophir and Schlumberger could not reach an agreement.
Golar LNG shares were up 7 percent at $18.40 in afternoon trading. Up to Monday's close, the stock had lost nearly two-thirds of its value in the past 12 months. (Reporting by Amrutha Gayathri in Bengaluru; Editing by Kirti Pandey)