New Fortress Energy announced on July 9 that it has signed a framework agreement ("Agreement") with the Sri Lankan government to build a new offshore liquefied natural gas (LNG) terminal, storage and regasification terminal ("Terminal"). The terminal will be located off the coast of Colombo and will supply natural gas to the country's power plants, mainly located in the Kerawalapitiya Power Complex.

The Kerawalapitiya power complex currently has 300 MW in operation and is expected to eventually grow to more than 1,000 MW by 2025.

As part of the agreement, the new fortress will supply natural gas to the existing 300MW Yugadanavi power plant and is negotiating to purchase a 40% stake in the government’s company that owns the power plant. The power plant currently supplies electricity to the State Grid under a long-term power purchase agreement (PPA), which will last until 2035. The power plant consists of General Electric turbines and is configured to use natural gas in a combined cycle.

“We are very pleased to support Sri Lanka’s transition to clean, reliable and affordable energy,” said Wes Edens, Chairman and CEO of New Fortress Energy. “For Sri Lanka’s first LNG terminal The investment will promote the country’s clean energy transition and support the sustainable development of this vibrant economy. This is the first of many investments in the country’s power and infrastructure that we believe."

The terminal will introduce natural gas to Sri Lanka for the first time and will help transition to low-carbon energy. According to the Sri Lankan authorities, NFE’s investment is in line with the government’s policy of accelerating the transition to cleaner and cheaper energy, which shows that the country is open to investment and business. As part of the agreement, the government will assist New Fortress in obtaining the necessary permits and rights to build an LNG terminal. The terminal is expected to start operations in the second half of 2022.

Keywords: oil and gas, international engineering

Sri Lanka is a diverse and vibrant island country with a population of more than 21 million. This investment represents the first LNG terminal in Asia for New Fortress. Purchasing the government's interest in the company that owns the power plant is subject to the final document, and the two parties will work together to finalize their commercial agreement. The New Fortress signed an agreement with the Minister of Finance and the Ministry of Finance.Editor/Baohongying