LNG

New Fortress Energy said that after successfully producing LNG at its first floating LNG production unit offshore Altamira in the Gulf of Mexico the firm has now closed a $700 million loan for its second FLNG unit.

“Now operational, FLNG 1 expects to deliver its first cargo in August and enter full production thereafter,” said NFE.

The new loan will fully fund the construction of the FLNG II units,” added NFE.

This project will be developed in partnership with the Mexican state agency, the Federal Electricity Commission.

It will “utilize the extensive in-place terminal infrastructure onshore” in Altamira.

The new liquefaction unit will incorporate the same proprietary modular technology as the first Mexican project, from Atlanta-based Chart Industries.

This second Mexican project is scheduled to complete the construction phase in the first half of 2026.

“Our FLNG complex is advancing at a rapid pace as we have now produced LNG at our first unit, and fully financed our second,” said Wes Edens, Chairman and Chief Executive of NFE.

Project values

“These are large infrastructure projects that add considerable financial and operational value to our company and we are thrilled with the progress to date,” stated Edens.

NFE’s “Fast LNG” project comprises modular, midsize liquefaction technology with jack-up rigs to enable lower costs

The company’s other main assets comprise two LNG import terminals in Brazil, one at Santa Catarina in the south and a second at Barcarena in the state of Pará in the far northeast of Brazil.

Chart Industries, the US equipment-maker for liquefied natural gas and other clean energy and industrial gases markets, said its technology enabled the delivery of first LNG to the New Fortress Energy production project offshore Altamira in the Gulf of Mexico.

New Fortress Energy, the US integrated LNG and power company that owns, operates or provides natural gas to 30 facilities in five countries, has signed an engineering contract to build a gas-fired power plant adjacent to its Barcarena LNG import terminal in Pará, the northeast Brazilian state.

Three leading US-based liquefied natural exporters, project developers and infrastructure owners, Cheniere Energy, Kosmos Energy and New Fortress Energy are testing the debt market’s appetite for LNG offerings in the form of senior notes totalling up to $2 billion.

Cheniere, the owner of the Sabine Pass export plant and the Corpus Christi facility in Texas and their expansion projects, intends to use the proceeds from the offering to retire all or a portion of the approximately $1.5 billion outstanding aggregate principal amount of Cheniere Corpus Christi Holdings senior secured notes due in 2025.

The Cheniere 2034 Notes will rank “pari passu”, or on an equal footing, in right of payment with existing senior notes at Cheniere, including the senior notes due 2028.

Kosmos Energy, which is based in Dallas, Texas, announced an offering of $300 million of convertible senior notes due 2030 by way of a private placement.

Kosmos is an exploration and production company with assets in the Atlantic Margin, including a stake in the floating LNG ventures being developed offshore West Africa in partnership with UK major BP and the nations of Senegal and Mauritania.

Africa to GoM

The company is also active in other projects, including offshore Ghana and Equatorial Guinea in West Africa and in the Gulf of Mexico.

Kosmos said it intended to grant the initial purchasers an option to purchase up to an additional $45M aggregate principal amount of notes, for settlement within a 13-day period beginning on, and including, the date on which the notes were first issued.

“The notes will be senior, unsecured obligations of the company and will rank “pari passu” with the company’s existing senior notes and the revolving credit facility,” said Kosmos.

Kosmos said it intended to use the net proceeds from the sale of the notes to repay a portion of outstanding indebtedness under the company’s commercial debt facility and pay the cost of capped call transactions as well as fees and expenses related to the offering.

“The capped call transactions are expected generally to reduce potential dilution to the company’s common stock upon any conversion of the notes and/or offset any cash payments the company is required to make in excess of the principal amount of converted notes,” Kosmos explained.

New Fortress

The third offering came from New York-based New Fortress Energy (NFE) and involved a cash tender for up to $250M of senior secured 6.750-percent notes due in 2025.

NFE activities span Gulf of Mexico LNG production, imports of cargoes to terminals in Brazil linked to gas-fired power and power assets in the US territory of Puerto Rico.

“The tender offer is subject to customary conditions, including, among others, that the offeror receive gross proceeds of at least $500M from a debt financing on terms and conditions acceptable to the offeror,” said NFE.

NFE retained Morgan Stanley & Co to serve as the sole dealer manager for the tender offer.

The South American nation of Colombia is making moves to import more liquefied national gas as the floating LNG terminal at the port of Cartagena has revealed expansion plans.

The terminal is a joint venture between Colombia’s Promigas and Dutch global energy storage giant Royal Dutch Vopak and is called SPEC LNG from its formal name, Sociedad Portuaria El Cayao.

SPEC LNG said it was now inviting expressions of interest from market participants for potential regasification services.

The Colombian floating storage and regasification unit (FSRU) is one of the original wave of FSRUs deployed in South America.

Cartagena is in the far northeast of the country on the Caribbean Sea and the terminal has been operational since December 2016.

SPEC LNG pointed out that the facility is Colombia’s main connection to international LNG markets and supports 2,000 megawatts of gas-fired power generation, about 60 percent of Colombia's gas-fired electricity capacity.

Gas security move

SPEC LNG said it was taking measures to address a potential shortage of natural gas supply in Colombia.

“Expansion plans consist of increasing its regasification capacity from 400 million cubic feet per day to 450 million cubic feet per day by the end of 2023 and up to a total of 530 mmscf per day as of the second half of 2026,” explained the company.

“This market test aims to assess demand from market participants´ for the potential additional capacity ahead of a final investment decision,” added SPEC.

The aim of the expansion is to ensure both medium-term and long-term supply of natural gas in Colombia as part of its energy transition measures.

“Considering the latest natural gas supply and demand projections in Colombia, the expansion of the capacity of our LNG import terminal is an efficient and competitive option to ensure the supply of natural gas to the market,” said Jose M. Castro, Managing Director of SPEC.

“As a result, this market test will help us advance to the next stages of the project before the FID,” he stated.

Vopak LNG interests

Dutch company Vopak’s most high-profile LNG investment is its 50 percent stake in the Gate LNG terminal in Rotterdam

Its involvement with SPEC LNG is through its 49 percent shareholding in the project with 170,000 cubic metres of capacity.

It also holds 60 percent of the Mexican Altamira import terminal on the Gulf of Mexico.

Vopak’s other LNG interests include its 44 percent stake in the 150,000 cubic metres capacity Engro Elengy terminal in Pakistan.

Enagás, the Spanish natural gas grid and LNG terminals operator. posted a 15 percent increase in net profits and said the network of six LNG terminals had saved the country money and confirmed the opening in early 2023 of a seventh and existing LNG export terminal dedicated to European Union supplies.

Royal Vopak, the Netherlands-based global storage company with four stakes in liquefied natural gas terminals and a new LNG import project for Hong Kong, reported a 7 percent increase in earnings to €827 million ($940M) from €780M in the previous year as soft business conditions persisted in energy storage.

Promigas, the utility company in the South American nation of Colombia, said it was studying a boost in regasification capacity at its Cartagena floating LNG import terminal on the Caribbean Coast to meet increasing demand.

Tokyo Gas and JERA Co. Inc., the leading Japanese utilities and LNG importers, have sold their combined 50 percent stake in a Mexican-based company operating five gas-fired power plants, including one close to the Gulf Of Mexico LNG import terminal at Altamira.

The Mexican company MT Falcon Holdings owns five natural gas combined-cycle power plants (CCPPs) in northeast Mexico and Tokyo Gas and JERA have sold their respective 30 percent and 20 percent stakes.

Each power plant has had long-term power purchasing agreement with Mexico’s state-owned Federal Electricity Commission.

Both Tokyo Gas and JERA have entered into sale and purchase agreements with Actis GP LLP, a London-based private equity firm with investments in global energy infrastructure.

The sales are expected to be completed by the end of March 2022 and are subject to certain approvals from Mexican government authorities.

“Tokyo Gas will enhance business expansion also in the global business such as renewable energy, gas and power supply, LNG infrastructure development, and contribute to the society through corporate growth with the experience and knowledge acquired from MT Falcon,” explained the Tokyo utility, which is aiming for more Asian investments.

The five MT Falcon plants have total generating capacity of 2,233 megawatts of power.

The value of the transactions with Actis were not disclosed, though the Japanese utilities seemed pleased with their sell-offs.

The power plant near the Mexican LNG import terminal at Altamira is a facility with 495 MW of capacity.

Three of the other plants are at Rio Bravo and the fourth is at Saltillo.

JERA also indicated that it preferred its investment portfolio to show more growth in Asia than in the Americas.

“JERA will continue to renew its portfolio going forward, selling assets and reinvesting the proceeds as it optimizes its asset allocation for compatibility with a changing business environment,” said JERA.

The company is the largest Japanese LNG buyer with 35 million tonnes per annum of volumes and controls a fleet of 20 LNG carriers.

JERA is Japan’s biggest fossil-fuel generator being owned jointly by Tokyo Electric Power Co. and Chubu Electric, the two largest power companies.

The joint venture company currently operates and provides fuel for a total of 26 power plants in Japan and imports LNG into 11 of Japan’s network of 37 terminals.

The Tokyo Gas LNG portfolio currently amounts to around 14 MTPA and the utility controls a fleet of 10 ships to deliver to its four import terminals, three around Tokyo Bay and one at Hitachi in Ibaraki Prefecture.

New Fortress Energy Inc., the New York-based LNG and power project company, has signed an agreement with a unit of the Mexican Federal Electricity Commission for the supply of regasified LNG from a new import facility within the next three months to two generating plants in the northwest state of Baja California Sur.

Under the agreement, New Fortress will provide the equivalent of an estimated 250,000-500,000 gallons of LNG (20,000-40,000 million British thermal units) per day to CFE’s CTG La Paz and CTG Baja California Sur power plants.

“We are pleased to support CFE’s transition to cleaner, more affordable and reliable energy,” said Wes Edens, Chairman and Chief Executive of New Fortress.

“This contract will help create significant fuel savings and emissions reductions for the benefit of the people of Baja California Sur,” added Edens.

The US company will supply regasified LNG to the plants to replace fuel oil via the company’s onshore receiving terminal facilities being completed in the port of Pichilingue in Baja California Sur.

The terminal is anticipated to come on line and begin the supply of natural gas to CFE in May 2021, though the company has released few details on LNG delivery and storage.

Pichilingue Port's LNG facility, located just north of La Paz, the Baja California Sur state capital, will be the third in Mexico when it enters service.

The two other Mexican LNG terminals are on the Gulf Coast at Altamira and south of Baja California on the Pacific Coast at Manzanillo.

The Pichilingue LNG facility will introduce natural gas to Baja California Sur for power generation for the first time. The state is in the lower part of the Baja California Peninsula and also currently lacks adequate onshore gas infrastructure.

New Fortress has a similar import facility in Jamaica in the Caribbean using floating storage that began operations in 2016 and another project in Puerto Rico.

The company is also working on a venture to supply regasified LNG to a 300 megawatts gas-fired power plant at Puerto Sandino in Nicaragua.