Golar LNG
One of our main position reinforcements in 2019 was in liquefied natural gas (LNG) infrastructure stocks, especially Golar LNG (GLNG, Financial). Our growing knowledge of the sector over the past three years has given us the confidence to do so. As to Golar LNG, over the year we saw significant pro-gress in the projects that support its stock valuation, underpinned by long-term contracts: in FLNGs (floating liquefaction) and, especially, in the downstream business that aids the transition from fossil fuels with high CO2 emissions (diesel, coal, etc.) to gas, which is cleaner. This latest business is starting up in Brazil, and the company hopes to extend it to other developing countries.
Golar LNG is aware that the complexity of its corporate structure makes it hard for the investment community to understand the business. The company has accordingly announced a simplification that will aid investor unders-tanding. We then expect the market to become aware of how the company's assets have been heavily undervalued.
In step with the rising credibility of Golar LNG's projects, and in view of the fact that other market currents conti-nued to keep the stock price level, we have increased our position.
From Francisco Garcia Parames (Trades, Portfolio)' Cobas Asset Management fourth-quarter 2019 commentary.
