New Fortress Energy extends Puerto Rico gas supply contract
The agreement includes incentive payment modifications and aims to lower energy costs.
New Fortress Energy Inc. (NFE) announced Monday it has extended its 80 Tera British thermal units (TBtu) islandwide gas supply contract with the Puerto Rico Electric Power Authority (PREPA) for an additional year.
As part of the agreement, NFE subsidiary Genera has also modified its 10-year operation and maintenance contract with PREPA. The revised deal eliminates future incentive payments in exchange for a one-time $110 million payment.
The agreement was reached in collaboration with Puerto Rico Gov. Jenniffer González-Colón, the Puerto Rico Energy Bureau (PREB), the Puerto Rico Public-Private Partnerships Authority (P3A) and PREPA. According to NFE, the changes aim to streamline the incentive structure and advance a shared objective: “to deliver reliable, clean power to Puerto Ricans at the lowest possible cost.”
“We are pleased to reach this agreement, which strengthens our partnership with Puerto Rico,” said Wes Edens, chairman and CEO of New Fortress Energy. “Optimizing our existing contract allows us to accelerate the delivery of cleaner, more affordable energy while achieving meaningful cost savings and environmental benefits for the people of Puerto Rico.”
The extended gas supply contract includes substantial capacity to meet both NFE’s current downstream gas demand and the potential conversion of legacy diesel power plants to natural gas.
The extended contract provides capacity to meet NFE’s current downstream gas demand while supporting potential conversions of legacy diesel power plants to natural gas. These conversions, the company stated, are expected “to generate substantial cost savings and significantly reduce emissions, and also lay the groundwork for new long-term, cost-effective and sustainable power solutions on the island.”
NFE reaffirmed its commitment “to strengthening Puerto Rico’s energy security” through these agreements.
