LNG

New Fortress Energy Inc., the US LNG and power company that owns and operates facilities in five countries, has agreed to sell its small-scale liquefaction and storage facility in Miami in Florida.

The facility is being sold to a US middle-market infrastructure fund, which NFE declined to name along with the value of the transaction. NFE added that the transaction was expected to close in the third quarter of 2024 subject to customary terms and conditions.

The small-scale LNG liquefaction plant in Miami can process 100,000 gallons of natural gas every day for delivery to commercial, industrial and transportation customers throughout South Florida and the Caribbean.

The facility has three LNG storage tanks with a total capacity of around 1,000 cubic metres as well as two separate LNG transfer areas capable of serving both truck and rail.

Export permit

The facility is additionally authorized to export up to 60,000 tonnes per annum of LNG to Free Trade Agreement and Non-FTA countries for a 20-year term that began on February 5, 2016.

“The Miami Facility is the inaugural asset of NFE and we are proud to have built this best-in-class infrastructure,” said Wes Edens, Chairman and Chief Executive of NFE, listed on the Nasdaq global exchange.

“The sale highlights our commitment and execution of our asset sale program, allowing us to reduce debt and recycle proceeds into high return downstream projects,” Edens added.

The Miami plant sale follows NFE’s decision in mid-June to push back the schedules for first LNG at its floating liquefaction plant offshore Altamira in the Gulf of Mexico. The first cargo is being shipped during July rather than June

Mexico cargoes

The FLNG production facility is located in Mexican waters of the Gulf of Mexico offshore the port of Altamira where there is already an onshore LNG import terminal.

NFE said that the work necessary to begin operations was complete and the company had also completed the full remainder of pre-commissioning activities.

The FLNG facility has also received a positive ruling from the US Customs and Border Protection agency confirming that the transportation of LNG produced at NFE’s FLNG unit can transport cargoes on non-US Jones Act qualified vessels.

As a result of this ruling, NFE will be able to sell and deliver LNG produced at its FLNG facility offshore Mexico to US locations, including the territory of Puerto Rico.

The progress on FLNG in the Gulf of Mexico comes amid advances in import and power projects in the South American nation of Brazil.

NFE has now commenced operations in Brazil at both of its LNG import terminals and has 2.2 gigawatts of power plants under construction.

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.

New Fortress Energy, the US integrated LNG and power company that owns, operates or provides natural gas to 30 facilities in five countries has been awarded a new gas supply contract in Puerto Rico.

NFE said the Puerto Rico gas contract more than doubles the volumes of gas it currently provides to power plants in the US territory in the Caribbean.

The New York-based company additionally sold two operating power plants to the Puerto Rico Electric Power Authority (PREPA).

NFE explained that it sold the emergency power plants it constructed on behalf of the US Army Corps of Engineers in San Juan and Palo Seco in Puerto Rico to PREPA for $373 million in cash, subject to certain items and conditions.

Power security

“These plants were developed by the company in 2023 in rapid response to a competitive bid by the US Army Corps of Engineers to provide emergency power in order to stabilize the power grid in Puerto Rico,” explained NFE.

“They have become a cornerstone of Puerto Rico's energy portfolio, delivering critical baseload power to stabilize the grid in the aftermath of recent natural disasters, and as contemplated, their ownership has been transferred to PREPA,” NFE added.

Following a competitive bid process, NFE was awarded and has entered into a new island-wide gas supply contract with PREPA, ensuring continued gas supply to these power plants for up to four years.

“The expanded volumes under the contract will enable conversion of other plants on the island from diesel to gas, providing lower cost, cleaner energy to Puerto Rico,” NFE stated.

As a result of the early termination of the contracts that have governed the construction, operations and associated costs of the two power plants, NFE said that it expected to negotiate a mutually beneficial settlement of all outstanding obligations in the near future.

“We entered the Puerto Rico market in 2017 based on the island’s emergency need for natural gas and power,” said Wes Edens, Chairman and Chief Executive of NFE.

“The transactions mark a significant milestone in our continued commitment to Puerto Rico's energy security and cost reduction efforts while significantly increasing our business in the region,” Edens added.

LNG projects

In its most recently earnings, NFE reported net income for 2023 of $547.88M, an almost three-fold increase from the $194.48M achieved in 2022.

After the end of the financial year NFE noted that in February 2024 it completed the Brazilian Barcarena and Santa Catarina LNG import terminals and placed them into service.

In NFE’s “Fast LNG” operation whereby it produces LNG from feed gas, it placed into service its first unit offshore the Gulf of Mexico and is now expecting first LNG in March and the first cargo in April 2024.

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, the US LNG production and import projects developer, reported a jump in revenues and a swing to profits in the third quarter while forecasting bumper earnings from floating LNG production projects.

New Fortress Energy Inc., the expanding LNG terminals, production, shipping and power assets owner, has closed the sale of a power plant in northeast Brazil and said the proceeds would go to LNG projects.

NFE said that along with its joint venture partner Ebrasil Energia the companies had concluded the sell off of the Centrais Elétricas de Sergipe (CELSE) Power Plant to Brazilian power company Eneva S.A.

Under the deal, NFE explained that Eneva had acquired 100 percent of the shares of Centrais Elétricas de Sergipe Participações SA, the NFE-Ebrasil joint venture that had held the equity interests of the CELSE Power Plant, and 100 percent of the shares of Centrais Elétricas Barra dos Coqueiros SA which owns 1.7 gigawatts of expansion rights adjacent to the CELSE Power Plant.

“The closing of this transaction further deleverages and simplifies our capital structure and marks another significant step toward our goal of an investment-grade credit rating,” said Wes Edens, Chairman and Chief Executive of NFE.

Redeploying capital

“We are pleased to redeploy these proceeds toward the capital needs of our ‘Fast LNG’ program and downstream LNG projects worldwide, internally funding our strategic growth initiatives to serve our customers’ needs amid a structurally short global LNG market,” stated Edens.

A portion of the proceeds from the sale was used to pay off the entire outstanding balance of the fully retire Standby Guarantee and Credit Facility Agreement with GE Capital EFS Financing Inc., while Eneva will assume the outstanding debt obligations of CELSE.

Energos Infrastructure, a joint venture established between New York-based asset management firm Apollo and NFE, will continue to operate the “Golar Nanook”, a floating storage and regasification unit (FSRU) that remains chartered to CELSE for use at the CELSE Power Plant for more than 20 years.

NFE’s latest priority activities are related to its “Fast LNG” program for LNG production in the Gulf of Mexico and at other locations.

The US company will produce the LNG using its “Fast LNG” platforms, some of which will be built at the new Kiewit Offshore Services shipyard near Corpus Christi in Texas.

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

Investor day

The US company is additionally involved in other FLNG ventures, including one offshore Louisiana and another offshore the Republic of Congo in West Africa.

NFE is planning an investor day at the Kiewit yard to explain its US Gulf Coast FLNG ambitions.

The company has chosen Kansas City-based LNG construction company Kiewit as its partner for the event planned for 10:00 am Central Time on November 22.

CEO Edens has said he expected to achieve mechanical completion of the first FLNG unit in March 2023 and deploy it by mid-year, with additional units to follow soon afterwards.

New Fortress Energy Inc., the expanding LNG terminals, production, shipping and power assets owner, plans to hold a floating LNG investor day at the Kiewit Offshore Services shipyard near Corpus Christi in Texas.

New Fortress has chosen the energy subsidiary of Omaha, Nebraska-based construction giant Kiewit as its partner for the building of FLNG units on the US Gulf Coast and the presentation event will be held from 10:00 am Central Time on November 22.

“Specializing in the fabrication and integration of offshore projects, the 555-acre KOS facility is home to NFE’s ‘Fast LNG’ program and the ongoing conversion of marine infrastructure into floating liquefaction units,” explained NFE in a filing with the Securities and Exchange Commission.

Wes Edens, Chairman and Chief Executive of NFE, said he looked forward to hosting the event at the Texas facility.

“We expect to achieve mechanical completion of our first FLNG unit in March 2023 and deploy FLNG 1 into operation by mid-year, with additional units to follow soon thereafter,” explained Edens.

Skilled workforce

“Utilizing a highly skilled workforce on the US Gulf Coast, we have developed an efficient and repeatable construction process - essentially an FLNG factory - that substantially reduces the cost and time to build incremental liquefaction capacity to meet the urgent needs of the global energy markets,” declared the NFE CEO.

New York-based NFE also recently signed an agreement with Mexico’s national energy company Petróleos Mexicanos (Pemex) to form a strategic partnership including a floating LNG project in the Gulf of Mexico.

The agreement involves the joint development of the Lakach deepwater natural gas field for Pemex to supply natural gas to Mexico’s onshore domestic market and for NFE to produce LNG for export to global markets.

The US company will produce the LNG using its “Fast LNG” vessels to be built at the Kiewit yard.

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

Louisiana FLNG

The US company is additionally involved in other FLNG ventures, including one offshore the US Gulf state of Louisiana and another offshore the Republic of Congo in West Africa.

NFE is additionally advancing LNG-for-power projects in nations like Mexico, Nicaragua and Brazil as well as in the Caribbean.

NFE also said recently that it had entered a joint venture valued at $2 billion with New York-based asset management firm Apollo relating to floating storage and regasification units (FSRUs) in the LNG sector and this opened up a long-term financing arrangement.

The July 2022 deal involves NFE selling LNG infrastructure vessels it owns to the newly formed joint company whereby 80 percent would be held by Apollo funds and 20 percent by NFE.

That transaction would create a global marine infrastructure platform underpinned by long-term contracts, benefitting from NFE's LNG downstream operations and development activities, as well as Apollo's leading investment and maritime experience.

LNG FSRUs

Outwith the Kiewit Offshore Services shipyard plans NFE has an existing fleet that came from its acquisition in 2021 of Golar LNG Partners and its assorted FSRUs and LNG carriers.

The 11-vessel portfolio of the venture consists of six FSRUs, two conventional LNG carriers and three floating storage units (FSUs).

As part of the Apollo transaction, NFE has agreed to charter 10 of the 11 of the vessels from the Apollo-controlled venture for a period of up to 20 years.

Apollo is a high-growth, global alternative asset management business focusing on select investment strategies.

New Fortress Energy Inc, the expanding LNG terminals, production, shipping and power assets owner, has entered a joint venture valued at $2 billion with New York-based asset management firm Apollo relating to floating storage and regasification units (FSRUs) in the LNG sector and opening up a long-term financing arrangement.

New Fortress signed the deal to sell LNG infrastructure vessels it owns to the newly formed joint company whereby 80 percent would be held by Apollo funds and 20 percent by NFE.

“This transaction will create a global marine infrastructure platform underpinned by long-term contracts, benefitting from NFE's LNG downstream operations and development activities, as well as Apollo's leading investment and maritime experience,” said a joint statement.

NFE’s existing fleet came from its acquisition in 2021 of Golar LNG Partners and its assorted FSRUs and LNG carriers.

“The platform provides critical infrastructure for the delivery, storage, and regasification of LNG to power countries around the world, which can reduce their reliance on oil and coal to lower carbon emissions,” it added.

The 11-vessel portfolio of the venture consists of six FSRUs, two conventional LNG carriers and three floating storage units (FSUs).

Charters

“The total implied enterprise value of the transaction is about $2Bln and NFE will receive around $1.1Bln in proceeds after accounting for NFE's share of the venture and paydown of existing debt,” the companies explained.

As part of the transaction, NFE has agreed to charter 10 of the 11 of the vessels from the Apollo-controlled venture for a period of up to 20 years commencing either upon close of the transaction or upon expiration of the existing third-party charter agreements of the vessels.

The venture will also seek “growth opportunities” in support of both NFE and third parties to support the energy transition and bolster energy security globally.

Apollo is a high-growth, global alternative asset management business focusing on select investment strategies.

“Together with Apollo, we are creating a leading LNG marine infrastructure platform to help accelerate the energy transition while freeing up capital to continue to invest into our ‘Fast LNG’ and downstream LNG projects worldwide,” declared Wes Edens. Chairman and Chief Executive of NFE.

“We are pleased to be partnering with Apollo in creating a maritime infrastructure company that will help support NFE's growing LNG infrastructure needs going forward,” he added.

Apollo Partner Brad Fierstein said he was pleased to help further the initiatives of NFE in the LNG business through long-term investment.

“This is a high-quality portfolio that increases energy security around the world, accelerates decarbonization efforts, and facilitates LNG use which is cleaner and more affordable than diesel,” stated Fierstein.

NFE and Apollo said they expected to transaction to be finalised in the third quarter of 2022.

“Transaction proceeds are expected to be utilized to fund NFE's FLNG projects. as well as for ongoing downstream infrastructure and general corporate purposes,” the statement added.

Pemex deal

NFE recently signed an agreement with Mexico’s national energy company Petróleos Mexicanos (Pemex) to form a strategic partnership including a floating LNG project in the Gulf of Mexico.

The agreement involves the joint development of the Lakach deepwater natural gas field for Pemex to supply natural gas to Mexico’s onshore domestic market and for NFE to produce LNG for export to global markets.

The US company will produce the LNG using its own “Fast LNG” design offshore.

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

The US company is additionally involved in other FLNG ventures, including one offshore the US Gulf state of Louisiana and another offshore the Republic of Congo in West Africa.

NFE is also advancing LNG-for-power projects in nations like Mexico, Nicaragua and Brazil as well as in the Caribbean and in Sri Lanka in Asia. 

New Fortress Energy Inc., the US LNG-for-power company, has sold its stake in the Porto de Sergipe Power Plant in northeast Brazil along with its joint venture partner for around $1.3 billion.

Chart Industries Inc., the liquefied natural gas equipment-maker and industrial gas technology company, reported first-quarter 2022 all-time record orders of $636.8 million, its fourth record-order quarter out of the past five quarters.