LNG

New Fortress Energy has closed its first issuance of a fully committed $180 million bond facility through a subsidiary to pursue its growing liquefied natural gas and power activities in the Caribbean region.

New Fortress, the owner of LNG facilities in Florida and in Jamaica, said its NFE South Power Holdings unit arranged the transaction through NCB Capital Markets of Barbados.

Under the facility, the New Fortress unit issued $136.3M of 8.25 percent secured long-term fixed-rate bonds due in 2034 and up to $43.7M of 11 percent unsecured fixed-rate bonds due in 2036.

Some $117M of bonds were sold and New Fortress has a commitment from NCB Capital to purchase the outstanding bonds upon completion in the first quarter of 2020 of construction of New Fortress’s combined heat and power facility at Clarendon in Jamaica.

Net proceeds from the bond sale will be used to complete the construction of the power plant and to reimburse shareholder advances made by New Fortress.

The New Fortress company is led by Wes Edens, co-founder of the private equity group Fortress Investment.

Among his other activities, Edens is also co-owner of the English Premier League soccer club Aston Villa whose most high-profile fan is Prince William, elder son of the late Princess Diana and second in the line of succession to the British throne.

New Fortress made its debut on the Nasdaq global exchange in January 2019 after an initial public offering. Its main corporate focus now is introducing LNG to markets that lack access to the fuel.

In addition to its 100,000 gallons per day liquefaction plant in Miami, it operates a floating LNG terminal in Montego Bay, Jamaica, along with a fuel-handling facility in the US territory of Puerto Rico.

The Miami facility began operations in April 2016 and enables the company to produce LNG for export in intermodal ISO containers to the Caribbean and to small-scale customers in southern Florida.

“We are very pleased to partner with NCB Capital and the investment community in the Caribbean for the financing of the region’s first large scale gas-fired, co-generation power plant,” said Edens, the New Fortress Chairman and Chief Executive.

“We wanted to enhance our great partnership with Jamaica by giving investors a stake in this historic achievement by the country,” added Edens.

“Jamaica continues to be a model for the Caribbean, and we’re looking forward to turning on the plant in the coming months,” stated the CEO.

NCB Capital said it decided to partner with New Fortress because of the work that they have been doing across the Caribbean region in bringing in cleaner and cheaper energy.

“Liquefied natural gas is a cleaner and more efficient source of energy, and one of its major customers, the Jamalco Alumina plant, is a significant player in the mining industry which is a major contributor to Jamaican GDP,” said Steven Gooden, CEO NCB Capital.

“Lower energy costs bode well for us as consumers and the economy as a whole,” added Gooden.

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.