New Fortress Energy and Transportadora de Gas del Sur (TGS) have entered into a long‑term lease and capacity agreement for the Terminal de Gás Sul LNG import terminal in Santa Catarina, Brazil, with operations slated to resume in August 2026.
The lease is expected to generate an additional $50 million in annual EBITDA for TGS beginning in 2027, providing a predictable revenue stream that will support the company’s midstream operations and help offset its high debt burden.
The terminal had been operational since March 1 2024 but was suspended in mid‑2025 amid uncertainty over a capacity auction. The new lease agreement is therefore a reactivation and commercialization strategy that brings the facility back into full commercial operation.
For New Fortress Energy, the agreement delivers immediate, contracted cash flow and aligns with its integrated LNG‑to‑power strategy in Brazil, supporting the UTE Lins 2 power project slated to begin operations in 2031. The deal is a key component of NFE’s broader debt‑restructuring plan, which aims to reduce debt from $5.7 billion to $527 million.
Despite the positive cash‑flow outlook, NFE remains in a precarious financial position, with negative profitability margins, a low current ratio of 0.17, and a debt‑to‑equity ratio of 9.35. The lease provides a valuable revenue stream but does not resolve the company’s broader financial challenges.
The agreement underscores the growing importance of LNG infrastructure in Brazil’s liberalizing energy market, where demand for reliable gas supply is rising as hydropower output fluctuates and Bolivia’s gas supply contracts expire.
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