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In May, Excelerate completed its previously announced acquisition of New Fortress Energy’s business in Jamaica for $1.055 billion.
Under the deal, Excelerate has acquired the assets and operations of the Montego Bay LNG terminal, the Old Harbour LNG terminal, including a chartered FSRU, the 150 MW Clarendon combined heat and power plant, and small-scale regasification facilities throughout the island.
“Since we closed the acquisition, we have been laser-focused on ensuring a smooth integration of people, systems, and processes. We are also working to optimize the existing business, enhance customer service, and strengthen our continuity plans,” Kobos said during Excelerate’s earnings call on Monday.
He said that the Jamaica assets are exceeding Excelerate’s operational expectations.
Beyond immediate earnings contribution, the transaction also strengthens the foundation of Excelerate’s US LNG supply portfolio.
“Jamaica’s 21-year contract profile dovetails nicely with our 20-year offtake of US LNG from Venture Global’s Plaquemines Phase 2. With this alignment, we have secured a long-term downstream destination for our volumes,” he said.
$80 million to $110 million in incremental Ebitda
As Exclerates optimizes the Jamaica platform, the company expects to unlock near-term Ebitda growth by improving asset performance and expanding commercial activity, Kobos said.
“At the same time, we see a clear path to scale this model across the Caribbean that will require targeted investment to support new infrastructure development to expand our customer reach and to deliver on broader commercial objectives,” Kobos said.
The CEO noted that this approach is designed to enhance the value of the assets over time and strengthen the return profile of the broader transaction.
“By 2030, we expect to generate $80 million to $110 million in incremental Ebitda from optimizing the Jamaica platform and investing $200 million to $400 million in growth CapEx to expand our operational presence in Jamaica and across the Caribbean,” he said.
Large infrastructure projects planned
“Now let’s talk about how this is going to happen. First, we are focused on optimizing and expanding the Jamaica platform to meet natural gas demand driven not only by fuel switching across the island, but also by the need for additional power generation as the Jamaican economy continues to grow,” Kobos said.
He said that Excelerate’s team is “off to a great start”, identifying ways to increase throughput across existing infrastructure and extract greater value from current commercial agreements.
Exclerate has already begun to sell incremental volumes of LNG and natural gas to customers on the island, and the company expects this early momentum to continue.
“In the medium to longer term, we will make investments in larger-scale infrastructure projects that support our growth. These opportunities span a diverse range of initiatives, including new power generation, terminal expansions, LNG bunkering, and additional pipelines,” he said.
Regional LNG hub
Kobos said that the second part of Exclerate’s approach is to position Jamaica as a regional hub for LNG distribution across the Caribbean.
“Jamaica’s geographic location gives us a structural cost advantage. Its proximity to the US and to key regional markets allows us to respond quickly to regional demand, making it an ideal launch point for LNG distribution and power development,” he said.
“We are advancing a hub-and-spoke model that leverages our floating LNG terminal in Old Harbour as a central storage and distribution point. From there, we can efficiently deliver LNG throughout the Caribbean using smaller vessels to reduce transportation times and lower fuel costs,” Kobos said.
“We see this as a natural expansion of our downstream operations and an important part of our long-term Caribbean growth strategy. And while we are still early in our ownership, we have hit the ground running, and we see clear opportunities to scale the platform efficiently,” Kobos said.
Asked to provide further details about the Jamaica plans, Kobos said that “in terms of optimizing, we’ve already ordered ISOs. We’re buying trucks. We’re buying other vaporizers.”
“We’ve already hit the ground running and doing some of these smaller investments that will allow for immediate optimization, and that will continue,” he said.