NFE firms up plans for offshore LNG hub in Mexico

US energy infrastructure company New Fortress Energy (NFE) has finalised its agreements with Mexican state-owned electric utility Comisión Federal de Electricidad (CFE) as part of a growing strategic alliance.

The final agreements, which were originally revealed on 5 July 2022, are expected to be executed at a ceremony planned for 3 November in Mexico City. The agreements include:

• expanding and extending NFE’s supply of natural to multiple CFE power generation facilities in Baja California Sur;
• selling NFE’s 135 MW La Paz power plant to CFE; and
• creating a new floating liquefied natural gas (FLNG) hub off the coast of Altamira, Tamaulipas, with CFE supplying requisite feedgas to multiple NFE FLNG units using CFE’s existing and underutilized pipeline capacity.

Wes Edens, Chairman and CEO of NFE, said that the company expected these agreements to result in the delivery of the first FLNG unit by mid-2023 and enable the construction of a new LNG hub off the coast of Altamira.

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 CTG La Paz and CTG Baja California Sur.

As part of the agreements, CFE and NFE will extend the term and increase the volume of NFE’s gas supply agreement to CFE’s power generation facilities in the region.

Additionally, NFE will sell its own 135 MW Central Turbogás Amaunet 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 by nearly half a million tons of CO2 per year.

NFE and CFE are collaborating on the creation of a new FLNG hub off the coast of Altamira, Tamaulipas.

Pursuant to the now finalised agreements, NFE will deploy multiple FLNG units of 1.4 Mtpa each that utilize CFE’s existing firm pipeline transportation capacity on TC Energy’s Sur de Texas-Tuxpan Pipeline to deliver feedgas volumes to NFE.

NFE’s first FLNG unit, which is under construction at the Kiewit Offshore Services shipyard near Corpus Christi, Texas, is currently expected to achieve mechanical completion in March 2023, and will be delivered to Altamira for commencement of operations soon thereafter.

As part of the agreements, CFE would share in the production and marketing of a portion of the LNG volumes from the new Altamira offshore FLNG hub.

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