New Fortress Energy Plans Asset Sales to Alleviate Debt in Jamaica
New Fortress Energy reported a US$234 million loss for 2024 and plans to sell assets in Jamaica and Brazil to reduce its US$9 billion debt. Chairman Wes Edens emphasized Jamaica’s importance, with projected sales expected to raise US$2 billion. The company’s Jamaican operations generate significant annual profit, contributing to its financial strategy despite recent challenges.
New Fortress Energy (NFE), a regional natural gas supplier, has reported a loss of US$234 million for the year ending December 2024. The company plans to sell certain assets in Jamaica, Brazil, and its shipping charters as part of a strategy to alleviate its US$9 billion debt. Chairman and CEO Wes Edens emphasized that Jamaica would be the primary focus for these asset sales, which are projected to raise US$2 billion to help address the debt load.
As of December, New Fortress’ debt was four times larger than its US$2 billion capital, prompting the need to reduce this ratio to ensure manageable repayments. The company initially expressed intentions to sell its Jamaican assets last year, providing updates after successfully divesting an asset in Miami, Florida, in November. Jamaica currently contributes US$125 million in annual operational profit, amounting to approximately $20 billion in Jamaican currency, highlighting the significance of these assets for NFE.
In an investor call, Edens elaborated on the strength of the Jamaican market, describing it as the company’s oldest and most established market. He noted that the downstream market in Jamaica comprises about 30 TBtu and that virtually all earnings are cash flow derived from operations. NFE has been supplying liquefied natural gas (LNG) to Jamaica for almost nine years and has developed three main operational facilities in the country.
The Montego Bay facility, operational since 2016, is capable of processing 60,000 MMBtu of LNG daily, serving both the Jamaica Public Service Company’s Bogue power plant and industrial users. Similarly, the Old Harbour facility, in operation since 2019, has a daily capacity of 750,000 MMBtu and supplies the Old Harbour Power Plant and a combined heat and power (CHP) plant, alongside long-term contracts for steam and electricity supply to local facilities.
Edens remarked on the reliability of local assets, stating that they have “never suffered a dollar of credit loss” during their operational history. He expressed confidence in the asset’s market potential and the team working alongside NFE in Jamaica. Despite recording early debt repayments that led to a non-cash loss at year’s end, the company finished with US$966 million in cash, a significant increase from US$311 million the prior year.
New Fortress Energy is actively pursuing asset sales in Jamaica to mitigate its substantial debt load, projected at US$9 billion. With an emphasis on the strong profitability and reliability of its Jamaican operations, the company aims to raise US$2 billion through these divestments. As NFE continues to strengthen its financial standing, its Jamaican assets remain a core component of its strategy moving forward. The company’s recent profit generation and increased cash reserves indicate a hopeful outlook despite recent losses.
Original Source: jamaica-gleaner.com
