United Stated-based New Fortress Energy Inc. (“New Fortress”) and Sri Lanka’s Government have executed a definitive agreement for New Fortress’ investment in West Coast Power Limited (“WCP”), the owner of the 310 MW Yugadanavi Power Plant based in Colombo, along with the rights to develop a new LNG Terminal off the coast of Colombo, the capital city, the Company announced.
As part of the transaction, New Fortress would receive supply rights to the Kerawalapitya Power Complex, where 310 MW of power is operational today and an additional 700 MW is scheduled to be built, of which 350 MW is scheduled to be operational by 2023.
The announcement came midst of growing concerns expressed by the Ceylon Electricity Board (CEB) and Opposition parties on the deal.
“New Fortress will acquire a 40% ownership stake in WCP and plans to build an offshore liquified natural gas (LNG) receiving, storage and regasification terminal located off the coast of Colombo. New Fortress will initially provide the equivalent of an estimated 1.2 million gallons of LNG (~35,000 MMBtu) per day to the GOSL, with the expectation of significant growth as new power plants become operational,” media release said.
The 310 MW Yugadanavi Power Plant currently has a long-term power purchase agreement to provide electricity to the national grid that extends through 2035. This power plant consists of General Electric turbines and is configured to run on natural gas in combined cycle.
“This is a significant milestone for Sri Lanka’s transition to cleaner fuels and more reliable, affordable power.We are pleased to partner with Sri Lanka by investing in modern energy infrastructure that will support sustainable economic development and environmental gains,” said Wes Edens, Chairman and CEO of New Fortress Energy.
The Kerawalapitya Power Complex is the foundation of the baseload power that serves the country’s population of 22 million people. Delivering cleaner and cheaper fuels to Sri Lanka will support the country’s growth for years to come.
The Terminal is expected to begin operations in 2023.
NASDAQ-listed New Fortress s a global energy infrastructure company founded to help accelerate the world’s transition to clean energy. The company funds, builds and operates natural gas infrastructure and logistics to rapidly deliver fully integrated, turnkey energy solutions that enable economic growth, enhance environmental stewardship and transform local industries and communities.