New Fortress Energy Signs LNG Supply Deal
New Fortress Energy LLC has signed a long-term supply agreement for the purchase of 27.5 million MMBtu per annum of liquefied natural gas (LNG), or about eight cargoes a year, at a price indexed to Henry Hub through January 2030.
We’re pleased to take advantage of the dislocation in global LNG markets and secure ten years of offtake for our growing business.” - Wes Edens (Chairman & CEO)
https://www.rigzone.com/news/new_fortress_energy_signs_lng_supply_deal-11-feb-2020-161047-article/
Could this "unnamed partner" / supplier be LNG Limited?
https://www.upstreamonline.com/lng/new-fortress-inks-lng-supply-deal/2-1-753470
I think so. Here's why:
- 27.5 million MMBtu translates to approximately 5.58 mtpa
- LNG Limited has received approval for 8.8 mtpa (per 25 November 2019 ann.)
- Vietnam deal with Delta Offshore Energy Pte Ltd is for 2 mtpa
- Here at 30mins 30secs onwards, Greg says the following:
"We can go to FID at 6 million tonnes, 3 trains. Below that, it really doesn't make financial sense, but we would go at 6. But more importantly, I think if we can get that first customer to sign, I think there's enough interest in us, that we would get some momentum, so while we might go to FID at 6, we could probably be to the full 8 by the time we get to a financial close."
Greg has also repeated insisted on long-term supply agreements of 10 years or more. This latest deal between New Fortress Energy LLC and an "unnamed partner" in my opinion smells a
LOT like LNG Limited.
Read Wes Edens' comment above. LNG Limited has been in a tight spot. Who wouldn't want to swoop in.
Has Greg finally got this over the line? I think so. It's also odd for the news release to describe the deal using "million MMBtu per annum" in my opinion, usually articles reporting deals like this express capacity in "mtpa".
2 mtpa + 5.58 mtpa = 7.58 mtpa, which would be more than Greg's 6 mtpa minimum
All of the above is just my opinion and speculation, keen to hear your thoughts.
PS. Have bought and sold in the $0.5s and $0.3s previously if memory serves. Re-entered in the past few days as the market cap is now less than the land is it not?
