New Fortress Energy (NFE) has entered an agreement to divest its Jamaican assets to Texas-based Excelerate Energy Inc. for a cash offer of US$1.055 billion.

In a release, NFE shared that proceeds from the transaction will be used to reduce its corporate debt and for general corporate purposes.

The company anticipates the transaction will close in the second quarter of 2025 and said the deal “marks a key step in NFE’s strategy to optimise its asset portfolio and enhance financial flexibility”.

After entering Jamaica in 2016, NFE partnered with the Government, local businesses, and communities to expand access to cleaner, more affordable, and reliable energy. The company’s investments have been an important driver of Jamaica’s transition to a more diversified, secure and sustainable energy mix which has generated hundreds of millions of dollars in fuel savings, reduced the island’s reliance on oil-based fuels, and supported the growth of renewable energy sources.

According to Wes Edens, NFE chairman and CEO, “We are proud of the contributions we have made to Jamaica’s energy transition. Our Jamaican assets and employees are world-class and have played a significant role in improving both the cost and reliability of energy on the island, and we are confident that Excelerate will continue to drive meaningful progress for Jamaica’s energy future.”

Excelerate’s acquisition of assets and operations will include the Montego Bay liquefied natural gas (LNG) terminal, the Old Harbour LNG Terminal, and the Clarendon combined heat and power (CHP) co-generation plant.

As per the agreement, the new owner will assume and maintain the contractual arrangements already established by NFE and its customers.

“This transaction represents an important milestone in the execution of Excelerate’s downstream growth strategy. It will expand and diversify our platform while positioning Excelerate as the key provider of essential LNG import infrastructure in a desirable and growing Atlantic basin natural gas market,” said Steven Kobos, president and chief executive officer of Excelerate.

“These assets complement our existing operational expertise and our long-term LNG supply agreements while offering the potential for future growth opportunities as natural gas becomes an increasingly essential part of Jamaica’s energy mix.”

This strategic acquisition adds downstream and “last-mile” infrastructure to complement and diversify Excelerate’s existing portfolio. Additionally, the Jamaican business strengthens Excelerate’s competitive position, expanding on its core FSRU terminal services and gas supply businesses in a growth market.

At the same time, the acquisition presents an opportunity for Excelerate to expand operations in Jamaica by leveraging existing infrastructure to offer LNG Bunkering, increasing its industrial customer base, and expanding the capacity of the Clarendon CHP.

“Importantly, this transaction also enhances our financial profile, providing predictable, long-term cash flows at stable margins with a weighted average remaining contract duration of approximately 21 years including contract extensions. We are confident the addition of this Jamaica platform will deliver significant value for our shareholders, while building on our commitment to providing cleaner and more affordable natural gas to countries across the globe,” Kobos explained.

Excelerate intends to fund the transaction using a combination of permanent financing and cash-on-hand, having secured $850 million from a fully committed bridge facility.

“Excelerate is committed to connecting affordable LNG supply to downstream demand centres around the world. We are pleased to have the opportunity to build on the success of NFE’s Jamaican assets,” Kobos is quoted in a release from NFE.

“This acquisition will allow us to provide reliable, sustainable, and cost-effective energy solutions to the people of Jamaica for many years to come, while also expanding and diversifying Excelerate’s global market presence. Our focus in the coming months will be on working with the Government and New Fortress Energy to ensure the transition is as seamless as possible,” he added.