LNG

New Fortress Energy, the US developer of floating LNG production and import terminal and power projects, reported higher first-quarter revenues as “Fast LNG” projects advance along with regasification and power ventures in Brazil and Ireland.

The New York-based firm’s revenues jumped to $579.1M from $505.1M in the same three months of 2022 and were also up from the $546.4M logged in the previous quarter.

However, NFE’s net income dropped to $151.6M from $241.2M in the same three months of 2022.

The company explained that the construction of its first “Fast LNG” unit was 90 percent complete and deployment to Altamira on the Gulf Coast of Mexico was expected in the months ahead. 

NFE’s “Fast LNG” pairs modular, midsize liquefaction technology with jack-up rigs or similar floating infrastructure to enable lower-cost and faster deployment schedules.

“We expect to complete commissioning of our first ‘Fast LNG’ unit in the shipyard and on-location at the Altamira site and continue to anticipate first gas in July 2023,” said NFE.

The company noted that its FLNG 2 and FLNG 3 were already under construction and all long-lead items have been procured.

Brazil projects

NFE has also completed the Barcarena import terminal in Brazil and expects first gas deliveries to industrial customer Norsk Hydro in late 2023.

“We remain on schedule and also in 2023 expect to commence operations at our Santa Catarina terminal in Brazil,” NFE added.

NFE explained that construction of the 630 megawatts power plant at Barcarena is underway pursuant to a fixed-price, date-certain engineering, procurement and construction contract with Mitsubishi and Toyo Setal of Japan.

Operations at the plant are expected to commence in July 2025 pursuant to 25-year power purchase agreement with Brazilian distribution companies.

NFE is also selling a power plant in Mexico and was finalizing the sale of the 135-MW La Paz facility to Mexico’s Comisión Federal de Electricidad for around $180M. The transaction was expected to close in the third quarter.

The US company has also been awarded a 353 MW of capacity contract with a 10-year duration from the Single Electricity Market Operator (SEMO), the operator of the Republic of Ireland's electric grid.

NFE is also expecting to finalize a permitting and construction contract for a 600 MW combined-cycle, gas-fired power plant beginning operations in 2026 and to be supplied by a proposed Shannon LNG terminal project in Ballylongford in County Kerry, southwest Ireland.

New Fortress Energy, a US company seeking to develop the Shannon LNG import project in the southwest corner of the Republic of Ireland, is expecting an Irish High Court ruling on February 15 on whether the venture can go ahead in its present form.

The company, which started the first LNG import terminal at Montego Bay in the Caribbean nation of Jamaica, is now expanding to gain a foothold in Europe.

The Irish court ruling is likely to determine whether New Fortress can proceed to build the plant or whether it will have to apply for a new planning permission or abandon its plans altogether.

If Shannon LNG goes ahead, the project would support 400 construction jobs and dozens of full-time positions when operations begin.

The terminal project could begin operations as early as 2020 or 2021.

The project was first granted planning permission in 2008 but has been affected by delays. Its supporters believe a positive court ruling would help revitalise the economy of North Kerry, though environmentalists have expressed opposition.

The Irish environmentalists are opposed to the importing of US LNG cargoes as they are against hydraulic fracturing, or fracking, for shale-gas in America.

New Fortress itself became a listed company in the US at the end of January 2019.

The company conducted an initial public offering and raised more than $280 million in the sale of shares to investors as it listed on the Nasdaq global exchange.

New Fortress sold 20 million shares at $14.00 each, which was below earlier price indications. The shares were last trading on February 12 at $14.06 each.

New Fortress last year entered into an agreement to buy Shannon LNG, a project company that owns the rights to develop and operate the terminal and a combined heat and power plant on the Shannon estuary near Ballylongford.

New Fortress was co-founded by Wes Edens, who started the private equity company Fortress Investment and who has retained a majority stake after the Nasdaq listing.

Edens is the co-owner of two sports franchises, the US Milwaukee Bucks basketball team and UK’s Aston Villa Football Club.

His company is looking at two other LNG projects in the Caribbean, in Puerto Rico and the Dominican Republic, as well as one in Mexico.