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NFE said in a statement that the contract is currently under review for approval by the Financial Oversight and Management Board of Puerto Rico.
Moreover, the gas supply agreement (GSA) will provide supply of natural gas to Puerto Rico’s power system for a term of seven years.
NFE said this long-term arrangement will support Puerto Rico’s efforts to replace “expensive, higher-emission liquid fuels with cleaner natural gas, delivering significant savings to Puerto Rican ratepayers in the process.”
“We have had discussions on long-term fuel supply since April with the government of Puerto Rico and are pleased to have reached an agreement,” said Wes Edens, chairman and CEO of NFE
Edens said this “landmark” agreement provides two “critical” benefits to the island.
“First, it establishes security of supply in San Juan for the next seven years for power plants currently running on LNG; Second, it provides for incremental LNG volumes to be delivered, allowing for the conversion of additional gas-ready plants currently burning diesel, resulting in hundreds of millions of dollars in energy savings for Puerto Ricans,” he said.
Deal details
According to NFE, up to 75 TBtu of natural gas per year can be supplied through the GSA, with minimum annual take-or-pay volumes of 40 TBtu, increasing to up to 50 TBtu if certain conditions are met.
Pricing of the volumes supplied through the GSA is set at a blend of 115 percent of Henry Hub plus $7.95/MMBtu, excluding natural gas supplied to the units at San Juan 5 & 6 (which has historically consumed ~20 TBtu per year), the firm said.
Instead, these volumes are priced at 115 percent of Henry Hub plus $6.50/MMBtu.
The volumes under the GSA are expected to be supplied by LNG produced from NFE’s 1.4 mtpa Fast LNG facility located offshore Altamira, Mexico.
NFE noted that the Fast LNG facility achieved COD in the fourth quarter of 2024 and is currently producing LNG at a rate above nameplate capacity consistently.
Financial stability
“Matching our LNG production with long-term offtake has always been our goal,” Chris Guinta, CFO of NFE, said.
“This locks in sustainable long-term margins for NFE and provides a foundation of financial stability for our company,” he said.
Also, Edens added that Puerto Ricans “pay far too much for electricity today and this long-term agreement provides cheaper and cleaner fuel for existing power plants for years to come.”
“This contract complements our existing long-term 25-year supply contract with Energiza and the new 550 MW power plant they are developing. We believe the development of new, efficient gas fired generation is the path to long-term affordable and reliable power for Puerto Rico,” Edens said.
NFE reported a net loss of $557 million in the second quarter of 2025.
The company’s net loss in the second quarter widened compared to a net loss of $86.9 million in the second quarter last year and $197.4 million in the first quarter of this year.
NFE reported significant non-cash impairments of assets and goodwill totaling $699 million, and a total cash balance of $821 million, of which $551 million is unrestricted as of June 30, 2025.
It also reported a gain on sale of its Jamaican operations of $473 million.
In May, US FSRU player Excelerate Energy completed its acquisition of NFE’s business in Jamaica for $1.055 billion.