New Fortress Energy reported a US$234 million loss for the year ending December 2024 and is selling assets to manage debt, focusing on Jamaica. The company anticipates generating US$2 billion from these sales to alleviate its US$9 billion debt, emphasizing the value of its Jamaican assets, which generate US$125 million annually.
New Fortress Energy (NFE) has reported significant losses of US$234 million for the year ending December 2024. In response, the company is initiating plans to sell various assets in Jamaica, Brazil, and its shipping charters to alleviate a debt burden currently standing at US$9 billion. NFE’s Chairman and CEO, Wes Edens, confirmed that the primary focus of their asset sales is Jamaica, anticipating these transactions will generate approximately US$2 billion.
As of December, New Fortress’ debt exceeded its capital by a factor of four, reflecting the company’s need to manage its financial obligations effectively. Edens highlighted that the operational profit from Jamaica amounts to US$125 million annually. “Jamaica is the country where we went first. It’s our oldest and most developed market,” stated Edens during an investor call, underlining the importance of these assets.
New Fortress entered the Jamaican market nearly nine years ago, expanding into power generation. The company operates three major facilities in Jamaica, located in Montego Bay, Old Harbour, and Hayes. The Montego Bay facility, which has been operational since 2016, is capable of processing 60,000 MMBtu of liquefied natural gas (LNG) daily. This facility provides supply under a long-term contract to Jamaica Public Service Company’s Bogue power plant.
Likewise, the Old Harbour facility, operational since June 2019, serves as an offshore LNG station that processes 750,000 MMBtu daily, supplying the Old Harbour Power Plant and a 100MW combined heat and power (CHP) plant. Edens emphasized that these local Jamaican assets have never experienced credit loss, remarking, “So it is a phenomenal asset. It’s in a very, very good market.”
Despite these challenges, New Fortress has seen an increase in cash flow, closing the year with US$966 million, markedly up from US$311 million the prior year. Though the company has faced non-cash losses due to early debt repayments, it remains optimistic about the value of its Jamaican operations.
NFE’s strategic adjustments indicate an intention to stabilize their financial footing while enhancing their asset portfolio in the market where they have established a solid operational foundation.
In summary, New Fortress Energy is taking substantial measures to manage its financial challenges by selling off various assets, particularly in Jamaica. With the expectation of generating US$2 billion from these sales, the company aims to substantially reduce its US$9 billion debt. The importance of their Jamaican operations is highlighted by consistent profit generation and the historical stability of these local assets.
Original Source: jamaica-gleaner.com
