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NFE plans to transfer UTE Portocem contract for thermoelectric parks connected to the Barcarena and TGS LNG terminals.
A New Fortress Energy (NFE) closed a deal to acquire 1,6 GW under contract from the Portocem Thermoelectric Plant (UTE Portocem), a subsidiary of Ceiba Energy. In exchange, NFE will receive convertible preferred shares in UTE Portocem, marking an important movement in the thermoelectric energy sector.
The fifteen-year agreement, worth US$280 million per year, was won by UTE Portocem in the 1st Power Capacity Reserve Auction, organized by Aneel in 2021. Completion of the transaction is subject to regulatory agency approval, marking a significant step for NFE to expand its operations in the LNG market.
New Fortress Energy announces the acquisition of 1,6 GW in contract from UTE Portocem
New Fortress Energy (NFE) announced the acquisition of 1,6 GW under contract from the Portocem Thermoelectric Plant, an investment from Ceiba Energy worth approximately R$4,7 billion. It is transaction, carried out through capacity reserve em auction, represents a significant milestone for the company in the thermoelectric energy segment, further expanding its presence in Brazil.
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The transaction is expected to close in March 2024, with project cash flows estimated to begin no later than July 2026, aligning with the construction phase of UTE Portocem, located in the Ceará Export Processing Zone (ZPE Ceará), within the Industrial complex and Port of Pecém (CIPP).
Wes Edens, president and CEO of New Fortress Energy, highlighted the strategic importance of the acquisition, stating that 'we are extremely pleased to expand our business in Brazil and consolidate NFE as a leading supplier of clean energy and reliable for one of the world’s fastest growing economies’.
NFE and LNG Terminals
As part of the transaction, NFE plans to transfer the contract for thermoelectric power assets connected to LNG terminals the company owns in Brazil, including Barcarena, in Pará, and Terminal Gas Sul (TGS), in Santa Catarina. Both terminals are scheduled to come into operation by the beginning of 2024, contributing significantly to the supply of clean and reliable energy in the country.
NFE's original 630 MW development in Barcarena remains on schedule, targeted for the third quarter of 2025. Additionally, NFE's strategy is to expand its power complex by 1,2 GW in Barcarena by 2026, allocating the 0,4 .XNUMX GW remaining for power generation assets connected to TGS.
Verticalization and Asset Optimization
By utilizing its existing asset base, New Fortress Energy expects to reduce costs and generate incremental yield and earnings at its LNG terminals in Brazil. Andrew Dete, managing director of NFE, emphasized that ‘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.”
The TGS terminal, in turn, hopes to overcome part of the limitations in the region's natural gas supply, meeting a demand that covers more than 3 GW from industrial and power generation customers. This transaction reinforces NFE's commitment to contributing to the expansion and strengthening of clean and reliable energy infrastructure in Brazil, remaining at the forefront of the thermoelectric energy sector.
Source: EPBR
