Wed | Oct 28, 2020

New Fortress Energy planning Nasdaq listing

Published:Monday | November 12, 2018 | 12:00 AM
Wes Edens, CEO of New Fortress Energy.

New Fortress Energy, the American company that develops gas infrastructures and supplies natural gas to Jamaica, has considered listing its shares on the Nasdaq stock exchange, but has redacted the pricing and amount set for the initial public offering.

It was unclear up to Tuesday when the IPO would come to market, as New Fortress declined to comment, saying it was entering a quiet period as stipulated by US laws in regard to such filings.

The company led by Wes Edens remains optimistic about growth prospects, citing prospects in the Caribbean and Africa. It currently holds contracts for five terminals across the region, including Mexico, and has two operational terminals and three under development.

The terminals in Jamaica include one completed in Montego Bay, which is operating at 36 per cent of its capacity, and an offshore terminal at Old Harbour set to be commissioned in early 2019, and which New Fortress has classified as operational. The three in development are based in Puerto Rico, Mexico and Ireland.

New Fortress also operates a liquefaction manufacturing facility in Miami that feeds the terminals in Jamaica. It also plans to develop five to 10 other liquefaction facilities by 2023, led by a plant in Pennsylvania set to open in 2019.

"At the completion of this offering, we will have committed approximately US$2 billion in building and developing our facilities since 2014," said the company's prospectus.

Financial information disclosed in the document shows that over nine months ending September, New Fortress made a net loss of US$43.4 million on total revenues of US$80.9 million. The company reported assets of US$485 million and book value of US$306 million.

The losses were attributed to the rapid pace of infrastructure development at the same time that the company was paying down its debt. New Fortress started booking substantial revenue in 2016, with the completion of the Montego Bay terminal. Its main customer is the national power utility, Jamaica Public Service Company, JPS.

In August, the American company secured a US$240 million loan from Morgan Stanley, which it utilised to pay off debt used to finance its build out of operations in Montego Bay, which cost US$44 million, and the Miami facility, at US$40 million. The rest of the loan will finance the construction of the Old Harbour terminal, as well as additional storage and regasification facilities for small-scale customers, the company said.

With just over a third of the capacity utilised at the Montego Bay terminal, the company said it was seeking new customers to enter into long-term gas supply contracts, at a target pricing of approximately US$10 per MMBtu, or million British thermal units. It said pricing may vary from the target, based on customer size, volume and complexity of delivery.

Currently New Fortress garners daily sales of 400,000 gallons or 33,000 MMBtu, at its Miami facility. But the company expects to grow that figure nearly 24 times to 9.4 million gallons per day based on its growth projections for new terminals and facilities.