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Gas Market with Reserve Auction, Thermoelectric Power, and LNG Terminals. 1.6GW Project on Construction Schedule.
New Fortress Energy (NFE) has closed a deal to acquire 1.6 GW in contract from UTE Portocem. The agreement entails a payment of US$ 280 million per year to NFE and was won by UTE Portocem in the 1st Capacity Reserve Auction held in 2021 by Aneel. Recently, NFE announced that it will assume the obligations and revenue of the capacity reserve contract from Portocem Thermoelectric 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 in contract from UTE Portocem to be completed by March 2024, with cash flows from the project projected to start at the latest by July 2026, bringing a new perspective to the thermoelectric power and capacity reserve market. The company’s aim is to transfer the contract to the thermoelectric power assets connected to the LNG terminals that the company owns in Brazil: Barcarena, in Pará, and Terminal Gas Sul (TGS), in Santa Catarina. Both are expected to come online by early 2024, solidifying NFE’s presence in the thermoelectric energy sector and its commitment to clean and reliable energy generation.
With a 1.6 GW project, UTE Portocem is an investment by Ceiba Energy, valued at approximately R$ 4.7 billion, which is currently under construction in the Ceará Export Processing Zone (ZPE Ceará), at the Industrial and Port Complex of Pecém (CIPP), becoming a landmark in the development of this sector. NFE’s strategy is to expand its energy complex by 1.2 GW in Barcarena by 2026, while the remaining 0.4 GW will be allocated to power generation assets connected to TGS, enhancing its power capacity and reinforcing its market presence.
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NFE and Portocem Thermoelectric Power Plant: Asset Expansion and Integration
The original development of 630 MW by NFE in Barcarena remains on schedule for the third quarter of 2025, demonstrating commitment and agility in project completion. By leveraging its existing asset base, the company expects to reduce costs and generate revenue and incremental gains at its terminals, strengthening its position and contributing to the country’s energy stability.
‘With the acquisition of the Portocem PPA, we are adding a long-term 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 value for shareholders in the long run’, said Andrew Dete, CEO of New Fortress Energy, emphasizing the company’s commitment to asset expansion and integration in the thermoelectric energy and capacity reserve market.
The TGS terminal expects to address part of the limitations in the natural gas supply in the region, which includes over 3 GW of industrial and power generation customers, making a significant impact on the thermoelectric energy sector and reinforcing New Fortress Energy’s strategic position in the Brazilian energy market.
Source: EPBR
