New Fortress Agrees to Expand Supply of Natural Gas to Baja, Build LNG Hub Offshore GOM
New Fortress Energy Inc. has entered into an agreement with Comisión Federal de Electricidad (CFE) to expand the supply of natural gas to Baja California Sur and build a new LNG hub in the Gulf of Mexico (GOM).
The agreement is part of a growing strategic alliance supported by Mexico’s President Andrés Manuel López Obrador and by Manuel Bartlett, the CEO of CFE.
The deal involves expanding and extending NFE’s supply of natural gas to multiple CFE power generation facilities in Baja California Sur, and also selling NFE’s 135 MW La Paz power plant to CFE.
It also involves NFE creating a new LNG hub off the coast of Altamira, Tamaulipas, with CFE supplying the requisite feedgas to two NFE FLNG units using CFE’s existing pipeline capacity.
NFE and CFE plan to collaborate on the creation of the new LNG hub off the coast of Altamira, Tamaulipas. NFE plans to deploy multiple FLNG units of 1.4 MTPA each that utilize CFE’s existing firm pipeline transportation capacity to deliver feedgas volumes to NFE.
As part of the agreement announced today, CFE would share in the production and marketing of a portion of the LNG volumes from the new Altamira offshore LNG hub.
Baja California Sur
In July 2021, NFE commenced commercial operations of an LNG regasification terminal in the port of Pichilingue, La Paz, Baja California Sur. The terminal, which features NFE’s proprietary ISOFlex system, is optimally positioned to supply natural gas to CFE’s generation facilities in the otherwise resource-stranded region, which include CTG La Paz and CTG Baja California Sur.
Pursuant to today’s agreement, CFE and NFE will extend the term of NFE’s gas supply agreement to CFE’s power generation facilities in the region and increase the volume of delivered natural gas under mutually agreeable terms.
Additionally, NFE has agreed to sell its own 135 MW power plant in La Paz to CFE. The addition of this power plant to CFE’s generation fleet is expected to enhance system reliability, reduce power costs, and complement steps CFE is taking to expand the use of renewable energy resources and lower emissions in the region.
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