NEW YORK—New Fortress Energy LLC (NASDAQ: NFE) announced March 5 that its Puerto Rico subsidiary, NFEnergía LLC, has entered into a contract with the Puerto Rico Electric Power Authority (PREPA) for the supply of natural gas and conversion of Units 5 and 6 of the San Juan Combined Cycle Power Plant. The initial term of the contract is five years, with options for PREPA to extend for three additional five-year periods.

PREPA estimates that the conversion of these units from diesel to natural gas will generate an estimated $750 million in fuel cost savings over five years for PREPA and significantly reduce emissions.

“This is a very pivotal transaction for PREPA and Puerto Rico,” said Wes Edens, founder and CEO of New Fortress. “The conversion of San Juan Units 5 & 6 to natural gas will save hundreds of millions of dollars and accelerate the modernization of critical power infrastructure. Natural gas power is cleaner, cheaper and is the perfect complement to renewable energy. New Fortress is proud to invest in the security and sustainability of Puerto Rico’s clean and renewable energy future.”

After multiple conversion attempts over the past 10 years, PREPA launched a competitive request for proposal bid process in July 2018 for the supply of fuel and the conversion of San Juan Power Plant’s Units 5 and 6. NFEnergía’s bid was selected based on 14 grading criteria, which included experience and capacity, approach and methodology, and price.

“For the first time, this infrastructure project will successfully bring natural gas to the north of Puerto Rico, achieving one of the strategic objectives of the Island’s energy sector. It also provides substantial savings to our customers and reduces carbon dioxide [emissions], which impact the environment and climate change", said José Ortiz Vázquez, PREPA’s CEO. The contract has been approved by the Puerto Rico Energy Bureau and the Financial Oversight and Management Board for Puerto Rico.

NFEnergía will supply natural gas to the power plant from its micro fuel handling facility in the Port of San Juan, which has been under development for more than a year. The facility is being constructed with multiple truck loading bays to provide liquefied natural gas to on-island industrial customers and microgrids.

The conversion of San Juan Units 5 and 6 and the development of the micro fuel handling facility are anticipated to be complete by mid- 2019.