Yahoo Finance New Fortress (NFE) Advances Construction of 1.6GW Power Plant
New Fortress Energy NFE, the U.S.-based energy infrastructure company, has confirmed the finalization and execution of an engineering, procurement, and construction contract (EPC Contract), awarded to a consortium formed by Mitsubishi Power Americas and Andrade Gutierrez, otherwise known as the MHI/AG Consortium. The EPC contract was associated with the construction of a 1.6 GW power plant, next to the Barcarena LNG terminal in Brazil.
The consortium has received a full Notice to Proceed from New Fortress to start the construction work, per the terms of the contract. NFE stated that the power plant will provide firm power capacity under the 15-year capacity reserve contract that was obtained from Denham Capital and CEIBA Energy. The contract was closed in March 2024.
Per the terms of the fixed-price EPC contract, construction activities for the thermal power plant have already commenced with commercial operations slated to begin no later than August 2026. The new power plant is expected to operate according to the 15-year agreement with the Brazilian Chamber of Electric Energy Commercialization.
In the first quarter of 2024, New Fortress concluded the construction and commissioning of both the Barcarena and Santa Catarina “TGS” terminals. The Barcarena LNG terminal, in addition to its existing 630 MW power plant and 25-year agreement, will provide LNG to a collective power capacity exceeding 2,200 MWs owned by NFE. The terminal will also supply natural gas to Norsk Hydro’s Alunorte alumina refinery under a 15-year contract, which began in the January quarter of 2024.
New Fortress has expressed enthusiasm for securing the EPC contract and the initiation of construction work for its 1.6 GW power plant in Brazil. The firm expects the project to be completed within the next 24 months. It has also noted that this project will enable an efficient energy transition and enhance the reliability of the national electrical system in Brazil. The new power plant is an important step for NFE to expand its presence in the country’s energy landscape.
Zacks Rank and Key Picks
Currently, NFE holds a Zacks Rank #3 (Hold).
Some better-ranked stocks in the energy sector are Archrock Inc. AROC, SM Energy SM and Hess Midstream LP HESM. Archrock and SM Energy presently sport a Zacks Rank #1 (Strong Buy) each, while Hess Midstream carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Archrock is an energy infrastructure company based in the United States, with a focus on midstream natural gas compression. It provides natural gas contract compression services and generates stable fee-based revenues.
SM Energy is an upstream energy firm operating in the prolific Midland Basin region and the South Texas region. For 2024, the company expects its production to increase from the prior- year reported figure, signaling a bright production outlook.
Hess Midstream LP owns, operates, develops and acquires a wide range of midstream assets, providing services to Hess Corporation and other third-party customers. The partnership has a stable fee-based revenue model secured via long-term commercial contracts. Since Hess Midstream operates through 100% fee-based contracts, it is exposed to minimal commodity price risks.
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New Fortress Energy LLC (NFE) : Free Stock Analysis Report
