New Fortress Energy says deal signed with LTL for Kerawalapitiya Plant

COLOMBO (News 1st); New Fortress Energy Inc. announced on Wednesday (14) that it signed a Memorandum of Understanding (MOU) with Lakdhanavi Limited (LTL), a private company in Sri Lanka, to jointly develop a 350 MW gas-fired power plant in the Kerawalapitiya Power Complex located in Colombo, Sri Lanka.

In 2016, Sri Lanka called for international tenders for the construction of the 350 MW liquefied natural gas power-plant in Kerawalapitiya.

However, the tender process itself was marred with serious issues.

Multiple proposals were forwarded to the Cabinet-appointed procurement committee, the Procurement Appeal Board as well as the Cabinet of Ministers with respect to the project, however, the tender was eventually awarded to Lakdhanavi Limited (LTL).

It was in this backdrop that Lakdhanavi Limited (LTL) had reached an agreement with New Fortress Energy to jointly develop a 350 MW gas-fired power plant in the Kerawalapitiya Power Complex.

LTL was previously awarded a 20-year power purchase agreement (PPA) with the Government of Sri Lanka through a competitive tender to provide electricity to the national grid.

On July 8, New Fortress announced the signing of a Framework Agreement with the Government of Sri Lanka to build an offshore liquefied natural gas (LNG) receiving, storage and regasification terminal located off the coast of Colombo, and rights to supply gas to the existing 300 MW Yugadanavi power plant.

New Fortress Energy Inc. also announced that it is negotiating the purchase of the Government’s 40% stake in the company that owns the Yugadanavi Power Plant in Kerawalapitiya.

New Fortress will utilize this same LNG terminal to also supply natural gas to this new 350 MW power plant. These two power plants total approximately 650 MW within the Kerawalapitiya Power Complex.

The MOU is non-binding on the parties, and actual terms of any future definitive agreements may differ from the terms of the MOU, said New Fortress Energy Inc.