Page 10 - GLNG Week 32

GLNG AmERiCAs GLNG
New Fortress racks up red ink
PRojECts & ComPAniEs
NEW Fortress Energy increased its revenues in the second quarter of 2019 over 2018, but the net loss also grew, from $18.8mn to $51.2mn. Over the rst six months of the year, net losses reached $111.5mn, from $29.74mn in the same period of 2018. e company, which has small-scale liq- uefaction facilities in the US and regasi cation operations around the Caribbean, held its initial public o ering (IPO) at the beginning of 2019.
total committed volumes rose to 2.6mn gal- lons per day in the second quarter, from 1mn gpd in the same three months of 2018. talks are being held on the delivery of 16mn gpd.
During the second quarter, the company’s Old Harbour terminal in Jamaica was commis- sioned and began commercial operations. e micro fuel-handling facility in Puerto Rico’s San Juan is set to start up in the last quarter. e San Juan plan involves a pipeline and truck-loading facility.
Power projects in Jamaica and Mexico are anticipated to be completed in the last quarter of 2019 and the second quarter of 2020 respectively. In addition to various projects underway, New Fortress has also signed a preliminary deal with Angola on the provision of LNG import capacity, with talks in progress with a second country.
Revenues rose as a result of the Old Harbour
project, in addition to higher volumes at Mon- tego Bay, also in Jamaica.
However, the cost of goods sold was higher, reaching $0.83 per gallon in the second quarter, from $0.69 per gallon in the rst quarter. Line costs for operations and maintenance (O&M), and selling, general and administrative (SG&A), were also up in the period. New Fortress blamed higher O&M costs on operating charter vessels, while SG&A was up on increased personnel and fees.
Operating expenses roughly doubled in the period to $83.7mn. e cost of sales reached $44mn, from $25.8mn in the second quar- ter of 2018, while SG&A hit $32.17mn, from $15.5mn. New Fortress raised $274.9mn in its IPO. New Fortress agged up opportunities in the sector, given low prices. is allows the company to cover its remaining supply needs, it said.
One area of opportunity for New Fortress is the provision of LNG to data centre clients. Similar to power plants, such customers require a constant supply of fuel and availability. e company is also working on a plan for LNG sup- plies to Shannon, in Ireland. A commitment is expected in early 2020, with rst gas in the third quarter of 2021.™
Cheniere ups volumes, losses
PERfoRmAnCE
CHENIERE Energy has exported 750 cargoes of LNG since beginning work, the company said in its second-quarter results, announced on August 8. During the recently ended quarter, it exported 104 cargoes, up from 61 in the same period of 2018.
Despite increasing its shipments, the com- pany posted a $114mn loss for the quarter, ver- sus a $18mn loss for the period in 2018. Over the rst half, it reported net income of $27mn, although this was still down on its 2018 num- bers, when it achieved $339mn.
Revenues reached $2.29bn in the second quarter, up 49% year on year on the same period in 2018, when it recorded $1.54bn. Over the rst half, it reported $4.55bn, up by 20% on 2018’s $3.79bn.
Explaining the widening losses in the second quarter, Cheniere noted higher operating costs and expenses and lower LNG prices – in addi- tion to various nancing costs, such as increased interest and a net derivative loss.
In June, the company made clear that it would focus on expanding its capacity over returning
cash to shareholders, although with some allow- ances for share buybacks. It also noted it would aim to have at least 50% equity funding in future projects, which it has adopted for Sabine Pass train 6 and Corpus Christi Stage 3. is latter project may reach a nal investment decision (FID) in 2020.
“ e second quarter was highlighted by con- tinued execution on our growth plans through a positive FID on train 6 at Sabine Pass, contin- ued commercial innovation with the long-term [integrated production marketing] IPM contract with Apache, and continued nancial discipline, re ected in the capital allocation framework we announced during the quarter,” said Cheniere’s president and CEO, Jack Fusco.
the official noted that higher output had helped to “o set relative so ness in short-term LNG market pricing”.
train 6 at Sabine Pass is due to be nished in the rst half of 2023, with construction cur- rently 2.1% complete. e other ve trains are already producing. At Cheniere’s Corpus Christi project, one train is operational, a second is in
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w w w . N E W S B A S E . c o m Week 32 15•August•2019