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Gas market with reserve auction, thermoelectric energy and LNG terminals. 1,6GW project on construction schedule.
New Fortress Energy (NFE) closed a deal to acquire 1,6 GW in a contract from UTE Portocem. The agreement provides for the payment of US$ 280 million per year to NFE and was won by UTE Portocem in the 1st Power Capacity Reserve Auction, held in 2021 by Aneel. Recently, NFE announced that it will assume the obligations and revenue from the capacity reservation contract of the Portocem Thermal Power Plant (UTE Portocem), a subsidiary of Ceiba Energy, in exchange for preferred shares.
New Fortress acquires 1,6 GW in contract from UTE Portocem
NFE expects the transaction for the acquisition of 1,6 GW under contract from UTE Portocem to be completed in March 2024, with the project's cash flows expected to begin in July 2026 at the latest, bringing a new perspective to the market in thermoelectric energy e capacity reserve. The company's idea is to transfer the contract to thermoelectric energy assets connected to LNG terminals that the company has in Brazil: Barcarena, in Pará, and Terminal Gas Sul (TGS), in Santa Catarina. Both are expected to come into operation by the beginning of 2024, solidifying NFE's presence in the thermoelectric energy sector and its commitment to generating clean and reliable energy.
With an 1,6 GW project, UTE Portocem is an investment by Ceiba Energy, worth approximately R$ 4,7 billion, which is currently under construction in the Ceará Export Processing Zone (ZPE Ceará), in Industrial and Port Complex do Pecém (CIPP), becoming a milestone in the development of this sector. NFE's strategy is to expand its energy complex by 1,2 GW, in Barcarena, in 2026, while the remaining 0,4 GW will be allocated to power generation assets connected to the TGS, expanding its power capacity and reinforcing its presence in the market.
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NFE and Portocem Thermoelectric Power Plant: Expansion and Asset Integration
NFE's original 630 MW development in Barcarena remains on schedule for the third quarter of 2025, demonstrating commitment and agility in completing projects. By utilizing its existing asset base, the company hopes to reduce costs and generate incremental revenue and gains at its terminals, strengthening its position and contributing to the country's energy stability.
‘With the acquisition of PPA Portocem, we have added a long-lived contracted asset that is highly complementary to our presence in Brazil. This aligns with our strategy of vertical integration and optimization of our assets in an effort to generate long-term shareholder value,' said Andrew Dete, Managing Director of New Fortress Energy, emphasizing the company's commitment to the expansion and integration of assets in the thermoelectric energy and capacity reserve market.
The TGS terminal hopes to remedy some of the limitations in the region's natural gas supply, which includes more than 3 GW of industrial and power generation customers, promoting a significant impact on the thermoelectric energy sector and reinforcing New Fortress Energy's strategic position in the Brazilian energy market.
Source: EPBR
