US-listed New Fortress Energy has introduced the first gas into its recently installed floating LNG production unit off Altamira in Mexico.
Speaking on a third-quarter results call, New Fortress chief financial officer Chris Guinta said all three jack-up rigs — which comprise the 1.4-million-tonnes-per-annum FLNG unit — are jacked up and hooked up.
Guinta said the first gas moved into the unit’s system on Monday.
He said commissioning will now take place and be completed by the end of this year.
The unit’s floating storage unit — the 160,000-cbm LNG carrier Energos Penguin (built 2014) — is due on site in 10 days.
“We expect to see the first drops of LNG in the next few weeks,” he said.
Guinta described the company’s development of its first FLNG unit — originally dubbed Fast LNG — as “remarkable”. He highlighted that New Fortress started work on it on 9 March 2021.
Wes Edens, chairman and chief executive of the company, said he sees what New Fortress has done with this project being mimicked elsewhere in the world.
Edens clarified that the organisation is still proceeding with its planned application for a 1.4 mtpa onshore LNG plant at Altamira.
During the call, New Fortress detailed that it plans to bring its floating storage and regasification unit-based terminal at the Brazilian port of Barcarena online in late December. A second at Santa Catarina is scheduled for start-up in January.
Andrew Dete, managing director of new business at New Fortress, said the Barcarena facility is mechanically complete. He said work on the 160,000-cbm LNG carrier Energos Celsius (built 2013), which is being converted into an FSRU at Seatrium yard in Singapore, is due to be completed at the end of November.
FSRU bonanza
On Monday, New Fortress announced it had inked a relet deal with Brazilian energy giant Petrobras to charter an FSRU — the 138,000-cbm Energos Winter (ex-Golar Winter, built 2004) — for the Santa Catarina terminal. New Fortress controls the ship through its shipping arm, which chartered it to Petrobras in 2007.
Dete said New Fortress is also planning to bring a three-mtpa, FSRU-based terminal online in Nicaragua in June 2024, which will support a 290-MW power plant.
He named the 125,000-cbm Energos Freeze (ex-Golar Freeze, built 1977) as the FSRU for this project.
Edens said the company is appealing a planning rejection of its Shannon LNG terminal for Ireland.
Speaking on the briefing, Ken Nicholson, who heads New Fortress’ green hydrogen production company, Zero Parks, gave an update on this emerging arm of the organisation.
Nicholson said Zero Parks is expected to become the largest green hydrogen producer in North America.
He said the company has doubled the size of its under-construction first plant at Beaumont to 200MW — or 100 tonnes per day of green hydrogen and can expand it further.
Zero Parks has signed a deal with Dutch ammonia and methanol producer OCI for the offtake from Beaumont.
This is due to start-up in late 2024 and be fully operational in 2025.
He said all of the terminals are on waterfronts so can be grown for exports, highlighting the demand from the international markets.
Nicholson said Zero Parks has two more plants under development and is in “advanced negotiations” for a fourth on the US Gulf Coast.
New Fortress raised its third-quarter net income to $62.3m, up from $56.2m in the same three months of last year.
But total revenue for the quarter fell to $514.5m from $731.9m in the corresponding period of 2022.
Edens said it was “by far the best operational quarter” in the history of the company, which is now generating cash flow entirely from its customers.
He highlighted that it is nine years since New Fortress was started, during which time it has spent $7.5bn on building out infrastructure.
Edens said the company expects to double its revenue in 2024 to close to $5bn.
New Fortress is pursuing an investment grade rating and highlighted that this will help with its LNG sales.
