LNG

New Fortress Energy, the developer of LNG production, regasification and electricity projects and with a small shipping fleet, said its Genera subsidiary was selected by Puerto Rico to manage the US Caribbean territory’s power generation system.

Dec 13 (LNGJ) - New Fortress Energy, the New York-based LNG projects developer, said it expected the business to generate more than $11 billion of additional liquidity over the next three years and more cash would be returned to shareholders.

   “Our business is now generating significant, stable, and growing cash, which we believe affords us the ability to both retain capital necessary to grow and return excess capital to shareholders in the form of meaningful dividends,” said Wes Edens, Chairman and Chief Executive of NFE. “We are fortunate to have a strong balance sheet and the liquidity we believe is necessary to execute our strategy and achieve our goals, matching long-term LNG supply with long-term power demand around the world,” added Edens, who also cited investments in floating LNG facilities.

The US Department of Energy has published its latest LNG monthly export data showing the Netherlands, South Korea, France, Spain and the UK receiving the most cargoes and the most expensive shipments departing from a Louisiana plant at the highest price from the export point so far in 2022.

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.

Crowley Maritime, a leading US shipping line in Central America and the Caribbean, has inaugurated an LNG unloading terminal and supply depot in Peñuelas for small-scale users in the US territory of Puerto Rico where clean energy needs are increasing.

The US Department of Energy published its latest liquefied natural gas monthly export data with France leap-frogging Mexico and India into seventh place from 10th in the overall standings as double-digit cargo shipments were diverted to Europe after the Russian invasion of Ukraine.

New Fortress Energy Inc., the New York-based LNG-for-power project company with LNG production plans offshore the United States and Africa, said that the US Coast Guard in coordination with the Maritime Administration had affirmed the completeness of NFE’s deepwater port license application.

NFE said that both US security and regulatory bodies would proceed with the preparation of an environmental impact statement as part of the environmental review within the 356-day application process.

NFE’s application proposes the ownership, construction, operation of an offshore natural gas export deepwater port, known as New Fortress Energy Louisiana FLNG.

The project will be located in Federal waters about 16 nautical miles off the southeast coast of Grand Isle, Louisiana in a water depth of 30 metres.

NFE said that the deepwater port would allow for the export of about 145 billion cubic feet of natural gas per year, equivalent to 2.8 million tonnes per annum of LNG.

“This is a significant step forward for our effort to build the first ‘Fast LNG’ facility in the United States,” said Wes Edens, Chairman and Chief Executive of NFE.

The NFE “Fast LNG” design pairs modular, midsize liquefaction technology with jack-up rigs or similar floating infrastructure.

While analysts note that NFE equipment would enable a much lower cost and faster deployment schedule than floating liquefaction vessels, the industry has still to be persuaded that the NFE technology will pass safety and operational tests.

Equipment

Under the NFE plan, a permanently moored floating storage unit (FSU) would serve as an LNG storage facility alongside the floating liquefaction infrastructure, which can be deployed anywhere where there is abundant and stranded natural gas.

“With rapid deployment, this project can help address the energy crisis in Europe and support our efforts to reduce energy poverty by providing more affordable, reliable and cleaner fuel to our growing portfolio of customers,” explained CEO Edens

Subject to the receipt of all required permits and approvals, NFE targets beginning operations offshore Louisiana in the first quarter of 2023.

NFE and Italian energy company Eni are also advancing a “Fast LNG” project in the Republic of Congo in West Africa.

The first African floating LNG joint venture would have capacity of over 3 million tonnes per annum once fully operational.

NFE is additionally continuing to advance LNG-for-power projects in nations like Mexico, Nicaragua and Brazil as well as in the Caribbean and in Sri Lanka in Asia.

Golar LNG Ltd said it sold about one third of the 18.6 million New Fortress Energy Inc. shares received upon completion of the sale of Hygo Energy Transition to NFE in April 2021.

The sale is expected to raise net proceeds of approximately $250 million which Golar said it would seek to deploy to floating LNG growth projects.

“Golar is excited about new FLNG growth prospects, including those being pursued by NFE and plans to remain a supportive shareholder for the foreseeable future,” stated Golar Chief Executive Karl Fredrik Staubo in regards to the sale.

Golar LNG reorganized its business following the sale of the Hygo Energy Transition stake and Golar LNG Partners to New York-based LNG-to-power firm NFE.

Golar finalized the sale in 2021 of its 50 percent stake in Hygo Energy Transition, formerly known as Golar Power, and its 32 percent interest in its US affiliate Golar LNG Partners, both to NFE.

Hygo Energy itself was a joint venture set up between Golar and US private equity firm Stonepeak Infrastructure Partners.

Golar LNG shares had plunged more than 30 percent, on 26th of September 2020, when Hygo Energy was caught up briefly in a Brazilian corruption investigation.

Previous crisis

Golar’s stock fell after news emerged of Hygo Energy Chief Executive Eduardo Antonello being involved in a probe into certain activities before he had joined Hygo Energy. Antonello later stepped down from Hygo Energy over the controversy.

The corporate crisis came at a time when Hygo Energy was expanding its LNG-for-power projects in northeast Brazil. The business was subsequently purchased by NFE, led by its high-profile CEO Wes Edens.

The Golar assets sales deals involved NFE taking over Golar’s US unit, Golar LNG Partners. and the Hygo Energy stake.

The transactions were valued at the time at more than $5 billion in cash and assets and turned NFE into the leading gas-to-power company in Brazil while providing LNG shipping assets and experience.

NFE already had projects in Jamaica and Puerto Rico and later started LNG import ventures in Mexico and Nicaragua.

New Fortress Energy has filed applications with three US regulatory agencies to deploy its “Fast LNG” production system in the US Gulf of Mexico offshore Louisiana with start-up planned by 2023.

New Fortress Energy Inc., the New York-based supplier of LNG for power to Latin America and Asia, has signed an accord with a subsidiary of Italy’s Eni in the Republic of Congo for the deployment of LNG production equipment off the coast of the West African nation for a period of 20 years.

NFE said it would set up its “Fast LNG” facility to produce up to 1.4 million tonnes per annum of LNG in the associated gas fields off the Congo.

The deal in the form of a preliminary Heads of Agreement provides a framework for negotiating a long-term tolling agreement between NFE and Eni.

NFE said that this would be for the full capacity of the facility and for the purchase by NFE of around 1.2 million gallons of LNG per day pursuant to a 20-year free-on-board (FOB) sales and purchase agreement.

The Republic of Congo associated gas from oil production was expected to start in the second quarter of 2023.

'Perfect partner'

“This landmark partnership is a major milestone for our ‘Fast LNG’ business. Eni is a world-class organization and the perfect partner for the first ‘Fast LNG’ unit,” said Wes Edens, Chairman and Chief Executive of NFE.

“With production beginning next year, we believe that this is just the first of many deployments of this game-changing technology around the world,” stated Edens.

“The customers at our downstream terminals need access to affordable, clean and reliable energy. Our portfolio of ‘Fast LNG’ facilities allows us to deploy offshore infrastructure more quickly and affordably, adds low-cost LNG to our existing portfolio and diversifies our business,” Edens explained.

NFE had previously signed a first African deal with the northwest African nation of Mauritania.

That NFE agreement was for the development of an energy hub, including natural gas, power and LNG, utilizing existing offshore gas reserves owned by Mauritania as well as neighbouring Senegal.

The NFE “Fast LNG” design 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.

Floating storage

Under the NFE plan, a permanently moored floating storage unit (FSU) would serve as an LNG storage facility alongside the floating liquefaction infrastructure, which can be deployed anywhere where there is abundant and stranded natural gas.

NFE said the HOA with Congo is subject to the finalization and execution of definitive agreements and a set of conditions expected to be completed and satisfied by the end of March 2022.

The company is also in advanced discussions for the deployment of this technology in several other markets around the world, including offshore the US.

NFE is additionally continuing to advance LNG-for-power projects in nations like Mexico, Nicaragua and Brazil as well as in the Caribbean and in Sri Lanka in Asia.

The company executed a 15-year natural gas supply agreement in Brazil at the end of 2021.

That deal was with a subsidiary of Norsk Hydro ASA for the supply of natural gas to the Alunorte Alumina Refinery in the northern Brazilian state of Pará.

NFE said it was advancing two Brazilian projects, one in Barcarena for Norsk Hydro and a second in Santa Catarina in southern Brazil.

The company said it was also positioned to supply LNG through the Santa Catarina terminal for power plants with more than 400MW of capacity from the second quarter of 2022.