New Fortress plans regas terminal off Sri Lanka
Nasdaq-listed New Fortress Energy has signed an agreement with the government of Sri Lanka to construct an offshore LNG import and regasification terminal, it said on July 8.
The terminal, to be located off Colombo, will supply regasified LNG to the Kerawalapitiya power complex which consists of 300 MW in operation today and is expected to grow to over 1 GW by 2025.
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As part of the agreement, New Fortress will supply natural gas to the existing 300 MW Yugadanavi power plant and is negotiating the purchase of the government’s 40% stake in the company that owns the power plant. This power plant is currently under a long-term power purchase agreement (PPA) to provide electricity to the national grid that extends through 2035. The plant consists of General Electric turbines and was configured to run on natural gas.
“We are excited to support the transition of Sri Lanka to clean, reliable and affordable energy,” New Fortress CEO Wes Edens said. “This investment in Sri Lanka’s first LNG terminal will advance the country’s clean energy transition and support sustainable development for this vibrant economy. This is the first of what we think will be a number of investments in power and infrastructure in the country.”
New Fortress said the government will facilitate the obtainment of necessary permits and entitlements to construct the LNG terminal, which is expected to begin operations by the second half of 2022.
This investment in Sri Lanka represents New Fortress’ first LNG terminal in Asia. With the environment in mind, Sri Lanka is looking to promote greater use of natural gas, while moving away from coal and oil-based power generation.