NFE - Earnings call transcript Q4 2019 | New Fortress Energy Inc.

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Operator

Ladies and gentlemen, thank you for standing by and welcome to the NFE Fourth Quarter and Full Year Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. [Operator Instructions]

to Andreini. conference like speaker to now Alan today, would hand over the your I ahead, go Please sir.

Alan Andreini

fourth end operator. welcome the LLC you you, all and Thank I to New would Fortress earnings call. XXXX like to quarter year Energy

posted to our that Officer. today Board; the of we Throughout to our Financial the Edens, Guinta, has McElmurray, Brannen going and Officer; Chairman call, Joining me and Energy Wes reference our Fortress CEO supplement website. here Chief are been the the earnings Chris Chief New are Development

In financial measures addition, to today. of some in we the will be supplement. be measures can measures The discussing non-GAAP earnings those GAAP call during the the comparable found most directly reconciliation

to encourage forward-looking that presentation will are point made actual today financial you quarterly Now, investor their including in report and statements to We differ statements, statements disclaimers our materially forward-looking filed out to press risk before release the I turn review statements, factors review and like call certain be regarding the contained the from future and the may results. nature to over by earnings. SEC. in non-GAAP with and measures regarding uncertain These would Wes, I our

Now I to to call Wes. the over would like turn

Wes Edens

and Right. ago through. our that's thanks this go what presentation refer Thanks, early going as a everyone posted we minutes Alan, we're and morning. on page We for in calling few the to web to

to want you up follow if So great. it will and along pull be

be was quarter we've some been company. quarter, margin detail. Pretty in there assets I positive last a X, margin on revenues We with Positive in we’ve lot walk very that XXXX a stuff is running best much stuff assets a development the That's well generating company of operating the the very, cash company. QX time. highlights. to generative the that it first in on quarter, operation. quarter, in under respective a in full recorded through substantially Page are to first much great. building be path flow Chris as operating are more the since transformation quarter for and run is But public operating the from relatively will company highlights. very said we're will news that Good our And fourth underway. had an every Start the second

[Audio Gap]

as Nicaragua. Puerto and XX then terminal in days an we to plant associated about we announced ago, signed Sandino, agreement a build power And new

a substantial of second. So talk very our spans about I'll basically fleet that them. pipeline three in behind terminals with five a to from

there. Number four, distribution LNG on supply has get had assets news been is our been our been focused side. have we've assets. on downstream with path in to look long term then online, It item for lock as the company the supply The for those That's very a we focus. all And will talk big the news step end we us. we of LNG securing XX Chris development here in good was to right detail. about precipitously spot basis time about do more and last $X fallen in in come that XX% in supply the basis, to the down as But long-term on prices that. by months, billion did of the have in at down step January, well. some

us is which net-net, a this upside. amount news under-supplied, good gives very still, We’re in of tremendous market and

plumbing. the Lastly,

It step capital basically in did appropriate structure is gives It'll think debt. from the financial we the to refinanced I and all increased side, debt. three years. path terms. very, equity debt Very for us. secured under extended that debt now $XXX our some This that having to We build-out without on committed very million. corporate right eventually basically stuff it excess We all is financing one We a much the the capital same the be to it balance for we to the million of there. on the we good $XXX need the On direction facility company. sheet combination the the

business Number inefficient and our just So simple part apply is let's focus economies. develop world. just of outside business. have The They Those the they the and the most revisit large infrastructure. We this what the and a really the briefly, is of business that Page chunk to -- and We the It One, flip is two portfolio world have on areas criteria. outdated populations are of Really those characteristics. really have to on operate two, cornerstone markets. is very global for business. growing terminals they infrastructure. big a our X. business developed terminal

You long actively not in there's from that the when discussions of And Caribbean. sun Asia. focus Mexico now. fleet can very recently the around set the having we've our These see got I there. are moved obviously world. we're the We concentric a Central circles us, been into the all right markets That's for from started on won't South Africa, America, terminals day America, where think big and

us of a it's us. most importantly for these are to to bring countries world. And portals business. these the focus the get once the the place, focus We that the big, big know So power LNG, that's in that terminals we around allow and

specifically X. Number the show looks like. you more We what Page geography

we're our we've numbers far, that then XX% the The terminal Jamaica, Juan, used. million the Sandino. over really volumes three relevant one you So done. Rico. million, assets It's to San the Caribbean, page in a it far can Puerto in La X.X committed terminals our side The now of right hand is Paz-Mexico, is the that a operation, are that gallons I developed capacity little constellation so right day, the of from got under on with about in see, actually two Puerto per pointed great two X in the being thus terminals and in of

flow. tremendous same. in amount a numbers the stay have We of organically margins. basically of high generated in we at a the growth you if it, assets. So the overall, Below We still generated those committed lot cash look portfolio

we're So million pipeline committed The XX.XX out then volumes extremely capacity, substantially. of utilized have roughly our robust. and of is gone the up XX%

hook actually And talk interested their about just we robust glory They proof-of-concept. come as that shown literary us lot country. to The existing it. I so using the we of a for more solutions are want. what shown the without you have words in people these for up having can and has brings us about developed throne can with them deliver been superlatives that tell assets have and business never we

should Page the It's through math. very, actually simple. X. walk I Number very

of Our plus in about to terminals minute, but the world. just and our around this talk goal, I'll is a more portfolio goal develop specifically XX a

per are can believe good look that’s box circles the gallons X That of two increased. you of a million do. about to numbers. sense right makes and got at margin there, Those in lower you. principle the It If markets amount if to faster, bigger gallons we XX% the that support can Those of broad a X look get then left what in Bernoulli's substantial X the the very, day. of But terminals, translates, hand per one million cash day. these at we've million kind of operating when at these hand between that It's so very terminals, that it's generates you think side, see we each actually side, day. margins flow. illustration gallons you can something X so million But we

the different are, so billion So $X.X of of we XX these a of the I would between we've with like of way and are a so very a portfolio terminals long numbers right of about discussion terminals very, now about a we billion gallons generated X way And applicable. are EBITDA, that in they look in quarter are big long, to eight million point than other markets is amounts very EBITDA. XXXth substantial list got $X pipeline X generated that million out of think there. day. there, We while What

down the that an is standpoint – we this on our well this. is focused the path achieving this in that we’re the So economic short-term, but goals from of

operating simple, if and What power San Brannen committed is completed, is turn on so volumes plant, first represent developments. XX% look the $XXX Juan plant, bottom Jamalco days basically, XXXX. to converted to committed the the and one goal XXXX, Puerto of at us X, is existing that just customers second four power in margin very two is and the volume QX math and $XXX power Bogue our average now plant, went talk the the Page to of ago, to million which to the the again, just growing converted, But Harbour being The to recently running. is on update, Paz of the plant is progress good page. lots in million La The side. going COD generate right we this means I’m based of on get which over the and up development you Sandino terminal these with for Old this power about we So, committed converted, which plants

or think So this. $XXX sense the million you about million to so, of my $XXX I'll valuation and next year I on going over how give two

is $XXX Taking by the million, which shares, a divide multiple right that's value. that multiple, in XX So to that's million with the the in in $X.X debt, million I is number billion $XX $XXX billion times on SG&A, million EBITDA $X which XXX enterprise less billion think $X.X $XX multiple, share. our net what valuation, is, start about

whatsoever, right So growth a executing the now, with and of existing stock doubling beginning. I just just it's no think our price, is business other our than

analysts on. into with and But think that's these something terminals positive about we’ll now this the with that get talk individually. has I transformed So about and cash talk investors flow

evaluation significant. think upside standpoint our I that is

of in are world's our One just about the Lastly, the are that very to other business goals mentioned simple a day-to-day. largest the in is And These become is company. our manifest, it IPP. over before goals. I things before our guys, two both let's I've talk there's what turn

$X a the to very producer operating on billion X that megawatts a outside terminals So billion you of to to in the XX XXX economics power. for easy million X million should a about Turn be portfolio, the follow, a gallons of numbers, in gigawatts, to Big XX very, largest to developed simple quarterly of margin. and is we gallons time. day power with world's that's of overall power into basis something pretty piece simple unit X countries, $X update X able million

largest but talk IPP you a achievable, in that the an is our look a as we much, much thoughts A huge end We'll emissions It's our first, still called audacious an there. to zero and than ourselves, direction operating obviously, and based power, power, think which and to and turn is world's I chatting me is Zero about goal, low-carbon for this and to aim a gas-fired very initiative in forward natural oil-based one be better deliver very, is coal-based over new years. want I'll is let the intend about substantially the I right we get goal give for than we fossil how second. is better passion entirely company to new big Brian. But that at on Today, Second, me, this it be why step XX in to power. Tomorrow, emission-free. fuel. of the about I

Brannen McElmurray

Wes. has Thanks, to doing excited had what over productive morning a mentioned joining we've and I'll past the to all been XX. quarter. very Wes us. thank you very you Good update Page We've earlier. on quarter as you for refer I'm

us for account are those assets XXXX and operation. for of volume, four Importantly, in all XX% our assets

a that of kind development to us in our a things And deliver we've we us our for can shown emphasize one, that able of of really is those concept because product faster, commitments; I'll most pipeline. assets working deliver other it the cheaper replicate currently really reasons: significant all number on gives proof can And in number game kind operation. So the number to that be two on we of milestone are that plan markets then for really a for and importantly, better. we're in that all is

supporting and those run XXX So you we it's Bay That's XXX briefly: terminal us. an cycle. for was exciting really megawatts. Montego XXX to terminal, first, days Bay recall, Montego the through expanded been To been as the combined have to now so XX megawatts initially

So well that per over facility gallons plants. customers now distribution industrial day supplies in XXX,XXX to power business as our as

XXX supports to referring be will terminal, of owned megawatts by partners. Harbour we Old and that is asset second the Marubeni the The which cycle combined its

running we're from outperforming underwrote basis per gas. a XXX,XXX out on to originally Wes something natural an What day, is is working XXX,XXX We full beautifully. in gallons day. facilities expectations As gallons performance at it facility closer on mentioned, that the actual again, our seeing

to. the on that third Wes and Jamalco turned in and referred the built steam. the has New XXX megawatts of also the day looked Fortess morning, And gallons that’s I'm operated. at This other XXX,XXX this asset, Energy a now plants Today, On power on it's operation now is think Monday, plant, boilers almost which first heat power in commercial it's producing produces designed, sorry, facility the with in I combination XXX,XXX doing. gallons power and it almost I it's and producing --

month, gallons which The fourth we the one is exciting Puerto run-rate It's San the to hit terminal is for facility extremely Juan this line about which We us is expected. expect again, at with in XXX,XXX fast projects. of what the day, in end it's track per because had that very a Rico.

end-to-end, generation in delivered for It us. combined XX that of Rico. think have a cycle supports probably existing record I Puerto XXX of months, is which power megawatts we in

Energy facility, on worked FSU, on Lots on good in, pictures, commissioning think at we think, Wes it's the you this on that. It As of beautifully. see, great I drama. berth that Coral that now. mentioned, our importantly, and picture -- Monday. No in Monday, around is we dock the brought the we website, which which XXth, to I lot posted of for Most a really media an can

it run for on able turbines. about there it the gas so is was are One itself, natural part second The plant power been to now. two has converted,

And be of turbine second in end The process completed will by of being the month. is the that process this converted.

that running is that our up March is XXX,XXX the by facility And so expectation around end of right and per day. gallons

together end of our are. in month. facilities are four at those the of are And what lion's share be the again, should them and So all by committed volumes operation the run-rate

So I’ll flip to Page XX.

using in are So that already are done. as essentially we next replicas of our off have jumping point, progress facilities what a that two

San is similar Juan. very what So terminal the La Paz in to we've done

As a of about the it fact matter of same. is exactly XX%

In now. status, construction in terms of it's

of day. that around XXX,XXX Our expecting this expectation that And is the the are volumes we’ll to year. by deliver achieve gas end right we're per first gallons

As Wes opportunity excited we're where in talk very preconstruction new to Nicaragua the phase also about in a we a assigned we’ve where mentioned, PPA, long-term committed to. now. It's

resources where we to expectation now XXXX. QX, our And the we're expectation gallons is that per project So deliver XXX,XXX on is in the there day. delivered gathering that were

be I something flip in. about I will I'm importantly, our XX, then to think you that Page going seeing we're talk to think, markets, which and very in interested

As world the is Wes that has of said under electrified. probably the a we're observing times, is number biggest trend just

average about and power. uses then U.S. the what average electricity capita per you the is of Kenyan As X/XXth about the per Jamaican average Jamaican of person on the capita uses per average capita the per X/XXth know, capita

XX we access what solution ability an So opportunity, getting economic the is previously sectors for In want fuel nations, power XX the we have based clearly, that from the place solve. because the in power power. be problem to months is we're to to private in to a worldwide coming affordable, this focused observed and what fast all of integrated to experience months, infrastructure request development. is just track go, on they to problem. The And that's and part are we solve then governments, that's the every perspective, done what have that a exciting asked and about we're it on is, reliable cornerstone

a perspective, and our And our so given particular location what is generation in XXX competitive is terminal the record, going of catalyze power we terminal, that from you track an markets any and which fuel, advantage be experience megawatts it. In think to support about XXX, infrastructure power the is our opportunity where then to our itself. have can

fast advantage control to a power. which With the the you gives provide fuel, terminal the tremendous track you and infrastructure

anyone goal XX Puerto is can with we in opportunities So that operate to see provide would on power in see jurisdictions which generation markets places be of believe expect us than in we number XX months. to to a we Rico, of our more terminal going and each a deliver quickly like opportunities These in be the else the other in price additional we Mexico, and it who'd operate. we that's to gives And key to able advantage competitive to offer. that the infrastructure at power

to goal installed is of deliver build, also terminals, quarter combination XX to earth. planet we're power, between XX own as and be able of largest the As there. to somewhere our the be on operate us IPPs X gigawatts in make about which would able gigawatts he Wes one And to said way and of said, a

good very feel chances about that goal. to of we So getting our

around now want Page you XX, to a give the couple flip the highlights for and I quarter. operations I to

importantly, I this what perspective good maintained, is think news. by I mean page incidents no the I from has important is really and you this quarter-after-quarter, zero. zero from track on of safety news be record about operational that have us. our extremely Every to And is the important number most day that's and our perspective think zero. The and is most religious page to about making focused

we the numbers us. is to the of stakeholders in safety couple which as perspective, operate for our of on people our welfare highlight the as from and environments an so And paramount page. in health, the well a Also

than we is, good are news support. is Our perspective, take extremely critical customers are most more from I as viewed that but reliable importantly, infrastructure. and customer a reliable about are available, we we the essentially available from and that it away the assets And the think

we And to to on deliver so customers critical for that their the they available them day-after-day, continue are side. as be

other our truck terms page quarter-over-quarter proud without of and LNG thing highlight The in ship number this incident, I on would goes of. which we're up is transfers extremely

us So arguably, incident, better. continue an terms try list day X,XXX in which in today From puts and we without about transfers Western around on perspective, every operational world. of one the and we probably the have get number to the experience hemisphere

the new better, markets be So drive operate. relentless we to new can which processes in more technology, with get introducing so just in we're competitive cheaper, faster, a we

Now I'll the about can Chris talk so turn financials. he it to

Chris Guinta

And this morning. to Great. wonderful talk you it's to all Thanks, Brannen.

on take moment First, you results XX, let for me Page the financial walk quick a to QX through XXXX.

First and Wes was million importantly, the way highlighted, operating our on best margin, first on has already as was in positive to this volume XXX quarter our history. most committed well with and we're quarter QX over alone. our

of you it's over of ramping XXX,XXX day. know, Harbour Old online plant the the and an is over of coming consumption, all QX and course profitability, to from due largely XXX,XXX the key QX, quarter. a averaged if gallons gallons As increase driver XXXX, for per it’s we and This

Old of Rico day million month of Jamalco over consumption. we gallons with a and Harbour Puerto X April, be the ramping, should During and

purchases additional volumes a As are normalized above gas XX% asset utilization and which as exponential be legacy margins, we expensive sold, on are there's concerned. on increases to an effect basis expect

million, $XX We the for the compensation excluding expenses do for development costs. Regarding of annualized included around non-capitalizable quarter non-cash development company SG&A, of which had stock-based go-forward compensation, and expect and million, that expense of about will $XX million non-recurring be we SG&A million expenses. $X the $X about

flexibility. balance closed the of our In of accomplished materially which on many borrowing. Page the term funds shows maturity sheet, million of our We we a of into $XXX prosecute all the XX. of in facility objectives debt some these same $XXX fully terminals. committed accomplished This calls Apollo XXXX. million We cost all additional X-year this, added of to on characteristics loan we've facility. financing outlines of our and we our business the Flipping January, of We the to strength maximum projects. key while This discussed new key maintaining capital past. extended out retained And

par fund capital. development however, you important most debt the additional to online, at at the this past, time. repaid that assets will lower One once of alluded we cost amounts can that new is projects of at come as any And features, our can be in borrow

additional of XX-XX-XX look forma million. the On the the cash we've page, to a our fund remaining debt in the facility. $XX $XXX we the is sheet under senior from transaction cash the the factor number including result and provided Nicaragua. ensure included of but pro secured of committed side you date, measurement balance also all and balance that cash as of executing the we refinancing Apollo right This showed on at $XXX This ample million the fully of was of funding as million the sheet, projects, have driving bonds, capital to the post-year-end

to turn has this come deteriorated few quarters. materially LNG market to the you any As XX, no will news us as of Page last surprise with the over

time. last Wes As in supplies a a price is in And turbine train added the one coupled we've produced on that LNG like easily the fact more class commodity will can't demand year. the this in stored, the has of consumed, at turned said if of time, at oversupply LNG the be result with experienced than has while one past,

in reduction from the and spot term the end market LNG XX%, the seen a of have of over market nearly Global XX% XXXX. prices down

operational million done announced see XXXX to for the once will of publicly for projects and what long-term $X.XX asset, NFE, Henry We've is executed supply consumption recently that at contract agreement portion profile in supply. Hub. of priced approximately using a become today's for Jamaica. we This our we we've a we the For volumes XXXX exactly

that these to fact NFE opportunity have LNG this XX, an we about we the LNG, depressed On imbalance. for take advantage depressed created which talked of Page amazing show prices the market

first cargo below delivered to able month. which Rico were later for will we this our fact, $X.XX, Puerto commissioning In buy be

have models corporate cost Our an assumed LNG $X.XX. of

position. at supply the today’s hidden value prices However, buy of our to our and demonstrates ability material

we've only of over third purchased on need to can X next XX supply XX, years. Page that you the about the see As the years on we a graph,

for bought of earnings up next you roughly prices If LNG you of deliveries. incremental could current margins our life five $X.XX billion advantage over compared be spot market today's conditions. approximately Caribbean volumes XX% assume to of by projections. remaining NFE's would Operating the years The committed over the and $X.X be for taking

XX, Turning this guidance, familiar look We've slide it include all once committed mistake these should presentations it should while ramp-up volumes. of do assets material formal you previous this the to you to Page operational. rapid capability as this slide in included flow for we shows and in not cash to demonstrate that

As alone Nicaragua, PR Jamaica ramp year. And Wes operating an mentioned, $XXX include basis of million over expect when and to and our this QX margin be next $XXX you from assets on will to during we summer. annualized Mexico million

look XX% currently expectations operating the margin volumes exceeds of in that converting billion. If $X are just at you discussion,

With over that, to it turn back I'll Wes.

Wes Edens

Zero for now, let’s Great. Zero. Fortress. emissions. about All our ours talk afford us and page not this. up good. Zero. And introducing zero lines company XX years from new We're a be and New just the to It's planet to before to an goal for Zero audacious of questions, that Zero carbon. flip about number be humanity ambitious is XX to division wrap for can't open emissions we audacious a

hydrogen. Hydrogen hydrogen. element of green XX% elements is universe there getting is is Why hydrogen? the planet, in in to abundant the green path all the most Our the

a costs of hydrogen so The element. I that say from little lot itself. in renewable I'll converted forms exist The a there are makes application by And and with abundant more productions is use and It is and path that of But this be can we'll talk this very of the that sense. a to makes think a their it current to energy. bit goal. just about naturally why a of second, getting rapidly energy. just achievable doesn't much form falling it's So more in into

very, that is schematic a negative, of fish So into developed daily It end XXX was the it. top in works. the positive, process at electrolyzer it’s a two the years of you up thing. being page space end the Imagine the It's in one had being in, picture pieces. molecule actually over look are an how up one a XX. breaks through is This good very you oxygen. nuclear one hydrogen, it ago. number bubbles station, electricity simple submarine. tank side run was electrodes The on other where that’s came The used used This daily is side

it's the as cost very simple. So point fossil something of age been What has is is changed space not cost to fuel What's the a as at hasn't The this the technology that used dramatically. out. replacement a it at changed historically has has reason in hydrogen going of The changed simply energy. of cost than electricity was greater the dramatically going value renewable changed the all.

misplaced power. as And energy, in for And so in been it view power. a that baseload has that's great, it's little bit not around while we I opinion, a dispatchable renewable the narrative think my a replacement

exist can when same really you energy hydrogen. doesn't to that, $X do that into So makes can produce multiply it compare to not and terms, simple wind to the the goal sun and does blow, it of times take to convert it $X viable. the kilogram it shine doesn't per very hydrogen, the power converted hydrogen, so though, X.X. What is natural is gas, In of

are It's $X.XX would Obviously, to fuels. gas ambitious today roughly and be be very half, end of technology we diesel, of So But the it, about could there. of an taxes so of to get development natural as cost costs government the from fossil that the $X goal $X change carbon would that and one and subsidization basically same rapidly. of seven half time $X, the you're of think to from course it. anywhere a away bit scenario the very,

Last XX. page, Page

way create other want that's everyone different cheapest don't mad to ways here and to the we the the to So go do hydrogen. the line want find it. We on find to be to scientist people and

to created. that commercialize hydrogen once it's is actually goal Our

of Most is using our want mile the gas GE infrastructure There to it. The hydrogen. it last and the hydrogen not provide usable the are the handling from turbines use of creating of of infrastructure So entirely is is is can we the where CHX what -- to that we terms with gas different methane in XX% the molecule and today. really that not.

is much of mile. doing providing last we're what that very terms helpful in So

there. challenge it's Our the in to catalyst is from in process. to in in It's get opportunity. doing. a also help be for tents, We I a learn huge people be wanting believe huge people goal by all to this whole to believe included but this us, big here of I

in What with us So is us. can let's with this do. case, do you partner

you If have Director you Zero. you point Suski and it person He'll have this. project that into take a of Jake look for our us is a at, be to the send us. want proposals

We in have library the all that articles world. there out of together a are hydrogen put the

at and And look so, through this. library a our go you can take

mentioned, article There's that are day. Now there how this. different lot about hydrogen each I've and thoughts many out and that the There's to articles them. different hydrogen. I world a you now people of oil in but fields, about power, do have want reading hydrogen, condemn every a is the there's solar underground once we electrolysis there thoughts different concentrated creating there's catalyze And most burning they lots of being on do, ways to it, that they obvious people way,

take we you works. we have pilot more very you want goal to Our and actually or next simple terms, can do. In down to XX it actually one the in is how projects months, show

when actually you I'm firsthand so, by doer threat we we in operates. a talk it how have can see existential that about the nature. And And

Difficulty] [Technical

Operator

Ladies and by. gentlemen, please stand

year begin patience. please by. full Thanks and stand call your earnings quarter will fourth momentarily. for NFE Your And conference

[Operator Instructions]

Unidentified Company Representative

can and loud hear you Everyone in coming you're now. Yes, clear.

Wes Edens

Operator, can you up call questions. the to open

Operator

Yes. can. We

Our ISI. with Jon Evercore first Chappell question from comes

You question. with may proceed your

Jon Chappell

and for you first you Wes before questions could cliff-hanger. two there actually, us the kind thing threat, I your a feel Actually a last thoughts you just finish of Chris. substantial substantial you But on left with so a out Wes, Maybe said was cut threat?

Wes Edens

to our hydrogen. from new power We're emission talking Zero, about through produce initiative zero

off. And so know cut really it where I don't

I our oil the think cut one of companies line. off

Jon Chappell

Probably. I'll move on. just

San the if on XX. prices the any the Chart on talk until today. to or potential and a either seems lower aren't buying going number upside are to bottom of to that that's to online it come Slide relative off the from LNG laid out tie go The line it left I once but Chris, are is And about in model the slide of current demand, with first Nicaraguan kind you start understand And have the facilities than you've XX. was in And wait and desire as lock there the that at that they thing that do I of the your ours. to you in the Mexico. sight Juan have chart to just you price facilities about spot these want and

upside chart? there's in So rest the what's take kind locking in today. that line of no back just of of holding that time It And the you you demand, on seems locking of opportunity than now. from like that sight better because advantage have

Chris Guinta

Yes.

it. Here's think how about we

market. long-term a is market spot the So

times January the that Hub end plus of signed So was contract -- at $X.X. we about Henry XXX% the

roughly price spot last $X.X Hub is $X.XX So price night. was Henry given current the at the

term is that the a oversupply. So around. long long market Henry of moves it obviously The But very are. runs term the where right contract move reflection term good now And for eight that's that's short years, numbers a Hub years. basis as around will nine is

$X.X. is price about spot So

the one a healthy So pretty it's other. gap versus

part One of that of a is commodity running store, branch, be hard relatively of. unlike needs which the right? characteristics this white to was So to

and wheat, the of to. wheat the elevator your This you go it you If went off wanted you so year-over-year. didn't sell the just an until on oversupply, you really commodity supplies. it And can't is the up, in get a basis spot roughly wait like and where of when production you prices can't price Prices then the you just when it, shut prices XX% the down down -- are a lot. stick

operating, assets unpurchased Brannen very, to is that a the approach use very line. look gas you'll in and what This go turned and work And and we said, path can go general that so got lot it. important that's more for us. snapshot a then developing lock you business, data. those we've the through extraordinary And the that short we from Page short margins, can We the why term, Chris it. If But going of to on, that as on shows working generate then, as of very the now, we do lot utilize right good they we hard of that robust. I which just as valuable assets we to is think see in development extent team to see getting then supply. this so the in some got take their you'll is on And a lot we're supply cargos a that short on is because they’re a XX is the more of lot to term

So a fault daily a through But market of even take bigger basis. It's think big numbers. it's of long on off thinking ways about of to be And we're the position of for in something advantage got has on a that's lot opportunity to remarkable our upside dislocation run. baseload own. even a no different us, we our

Jon Chappell

they like Henry laid fixed in Okay. And are the over kind that of call of that period think and nature you you plus there rate an rate Hub potential out? there are plus that extended that short. all I for Or clear, Are any kind times to be just then time? bids you fixed cover of last like in XX to that was in mentioned

Wes Edens

the off Not evolution -- being started as mean LNG there I is fixed oil-based. the of rate. is market

of States. in is Southeast different significant be So Brent-based or the extent So, think everything significant is somewhat it you're of We United decoupled Asia, a indices buying have to talked well. had there's these buy really extent. going relevant as it a fixed advantage in dislocated was there's We've decoupled. long-term rate stuff basis remain here some it. can buy terms activity with on, take -- lot ways more that that And think us. but now see a it's news you'll us to good relevant on I to I very to And Africa volumes we is we'll we of obviously. think in I ways a to it And has to in if Henry from think opportunities that Henry right? from I and think oil. Hub and do much gotten assets about doing coming that ourselves, it Hub have

Jon Chappell

last if one for Just I Chris, one may. quick

a very they going more downstream timing You just facilities supply and that of And talked a the typical structure, potentially thinking more callability new up Or match just short about is that? LNG new think with loan, forward kind debt the of it online? and do of about and the function the I to which corporate to the refinancing of a the want the of important. move side before on is demand gallons the covering supply banks of then see bringing

Chris Guinta

Hey, this, this. Jon. about had former Yes. matter refinance more I simply a in is external will mean, once are The the internal assets than we We've answer cash it's show meetings of latter. the flow, the and much of meetings. go operating

as we're speaking. the process So underway is

Operator

you. Thank

Our Nolan next question comes from with Stifel. Ben

your with question. proceed may You

Frank Galanti

Frank for Hi. on Ben. This Galanti is

incremental Puerto locations scale in then small to is merits business were just sales the in in So, wanted of various mind, sell how going build and and operating obviously, With I to a terminal Rico scale margins. ask small improve model Mexico? some the to on big part that in

Chris Guinta

to we we to to We've think have up a are Head big boon the us. a great. just delivers that can brought a terminals them. of actually sales But Logistics group. the for customers very scale robust new going have and Small we need is on sign be We before actually

fairly And up our dramatically. so, think you're go I scale going see volumes to small

analysts investors are and because And those the on, so, big while on. numbers, big we're are that focused the on turning your the numbers behalf, on both the

a customers have they cut dramatically. fuel very because good they on dramatically, the robust is really focus bills and we can for emissions very, us, cut scale news for economics actually think If not their We specific that only good it's small their if but them.

months think so, the a that part of our big business quarters. would big, And we and be coming in

Frank Galanti

wanted them. guess, five specifically hear I projects, if then, discussion. in or about I if those just there would eight Thanks. in Great. Dominican moving update guess, any there was forward Angola, Ireland in the and I in do then, and any, any, And terminals, curious I see have you guys be Republic on both to operational was progress, on to

Wes Edens

I can for all we have inquiry Yeah. that really provide of I volume updates substantial. prospective mean, you We is is very the others. any on don't tell and ones gotten competitive reasons that

a the week, I'm On all this tremendous very that to the the week next West imagination. people things there's when And lack tend rest are of Coast, of of think backlog actionable. Africa, we

about can things you their changes but So eyes they as them with really turn see it talk doing own dramatically. things, on, can

Rico I Rico think -- a is destination. to our Puerto be -- site is Puerto going in great tourism

our attractions I because an on if coming you the site down it's very months think encourage turned of transformational. of We it. short to to think what is in amazing that phone, at a really of I look big is want it's be the asset. the one time be there done can a take going to in out period spectacular be a representation everyone

something power more with in talking That's to are you'll gigawatt-and-a-half And more was more projects, couple this of them And this. happens, as of. terminals a guys and these is allows to people There's them. better of in in their a you're fantasy last megawatts somewhat view, right building total, are that's now. late a a and talk stuff more are XXX can that the building than XXX which see megawatts on lot gigawatt-power, because reasonable Asia, I XXX gigawatts think my the their I of increment so, and that. that night. not I catalysts for what and or a lot is power profile It’s into that to support actionable. what see much they of just think talking power about where in of energy infrastructure you for of power, have of these X,XXX our going really systems just about top countries something,

and power at look terminal a and and ourselves marine importantly, most think in tremendous do the all different well these it both opportunities. efficient, able as us very, short as everything time do to very we very side as being gives So for a paying we stuff profile frame, the

Operator

you. Thank

comes Our next with question BTIG. from Greg Lewis

You question. may proceed with your

Greg Lewis

you're bit you could It's time. mean, the to of with the thought about the potential and I It this imagine What's like that's Wes, a seems those potential to. there looking zero? decision? feedback isn't areas been build kind been and clearly this where go that's little could on touch customers be for more or the of should terminals heading customers business. first out if you of interesting. some the world future – put sort I where at least the

Wes Edens

for actually Well, our this initiation is it.

I’ve it. be I emissions of a economically And robust So is time part we part the great and last and is I of companies. scientists be want want, lot providing happens -- that lot It our infrastructure. are a to viable want lot team. technologies. of become team a that this all And spent part action on a is it, with a the have that of professionals power entirely really to different that be of big he of to We of really there. different our to actually planet, to We've at to And zero business out citizen the up the to answer a lot call a people coincidentally have here. it. don't the stuff We a a looked to visited look I've of hit usable that's so obviously, and night. website at hydrogen different convinced built transactions

put be going the an now right? if simply not it turbine, burn is it opposite hydrogen burning into in burn your and back electrolyzer if can you a So you'd CoX, a So had you you to that as could it can right produce had cell. -- can any fuel fuel you or you

So with electricity produces produces produces basically, water. take hydrogen and combined think it it air, it -- things, two

emission part well. it of as zero the So

we in you're invested transformation term the in transportation equity short previous a life, billion well what -- to We value think of our the see huge I businesses. transportation. going is in over $XX

oil really world like thirds I've So of pretty solid world I Two got like. of for the feel burned transportation. in looks view the burned is a the transportation

XX% ended $X.XX of think. equivalent MMBTU cost dollar game thing up fuel, the happen of hydrogen a people that I diesel. XXX you think than that to that's equivalents what can a kilogram kilogram, And changing faster with If a was that's lot

is credits kind it's be like complex to a on On or he's it cetera. longer, want it. lower talk not little planet. try But things the don't mean more like, electricity try and are a mean, and thing. part That's be as to It’s about we of not doing to talk do we I ski transformational is to That's going with mine, talking a carbon I not doing the that's fix skier, on buying he the famous that actually skiing. a friend but don't about it. margin, I a be et this and We may positive prices clearly bit side, a because and of this the I think want to need our to going out of actually I that. a want take it infrastructure it's We out now. profile. happen.

passionate this think very a I real so something we're is that path about.

Operator

Thank you.

Our comes question next from JMP Securities. with Devin Ryan

You may proceed your with question.

Devin Ryan

one first for guess I here Wes.

getting of and sounds and you're year the from a the you of IPO, the the spoke the new blazing essentially living kind it of in opportunity out also You're challenge and you're like about path. process market. somewhat airplane, of about versus a on an Wes, And educating the story

or of a terminal the you of could about do this path that? it critical Can proof materially year. in you more going be as if of to to are meaningful opportunities gain of new the will, of kind you sale about accelerate cadence process where concept really trying mass and kind like for critical bit where the you potentially a like feel And setting kind be just a you will guys what think feel so And talk acceleration? to you're contract is

Wes Edens

been last year. went I public look, year Yeah. we I mean, think, January a XX. It’s

over since done. we've a little a Just year

pretty much timeframe had the we’ve would I pretty forecasted what you back same at all happen in we think, it’s when look much happen, done.

on feel delivered it what I about good is. So having

go company's I think once dramatically profile you to flow. cash changes the

So the us. for fourth big positive margin, milestone modest quarter, even is though a most in it’s the

that. getting accelerated roll pipeline proof The we're of first things races substantially quarter And the of of said, of be again, increased for as the Chris this dramatically. to concept The built. from And is rest on will kind it. has

doing of that. on of to Nicaragua, Puerto you from the three to educating six or finding here my we're and going opportunities spending that gone long which and them One is introduce is And people when on two is make behind and to new get story. and countries building capital Mexico, very it self-funded, profile we��ve time with in. investors, the out Rico, there's a next it. things. mission months going case of list is Jamaica part So a big then to I'm is out a We don't actually in it, great and to to two to need a other commit be

very, I significant along our mission very a and the a of this good think lot do way. build it we can company. about into That's

forms. lot great that does And are of that. things. hasn't travel travel that's health a obviously just It so serious And of changed a Coronavirus something deal. the impacts a own both worldwide require profile -- it's and doing matter the whole My the those issues

a rest So, year extraordinary of that different week. us. for is to Africa of I week. to an think be as lot I places And be said, this of I'll I'll We've the go. gone going next this be in got most

Devin Ryan

to in X, I'm And more XX% be just model an terminal Slide kind curious on operating profitable maybe of, the average illustrative this kind as to fully an the going just the goals. range? a follow-up here of in the call bit as on and assuming scaled it's a economies even XXth more terminals little that platform? I'm terminal a of to it, opportunities So of Or margin math dig XX% first is is of of scale. -- more the

of words trying perspective magnitude terminal? just versus there to of the first call kind get the on it any some I'm XXth So

Wes Edens

the We're up as the find an terminal. once demand really lose building and profitability a opportunity, by So of example we building you end the business, you to is markets, the start it's infrastructure a don't got you power that. purpose volume and gets driven for that XXX if of really the catalyze want enough That's In for build The that. you in infrastructure to with. one start well, on or generate to of return megawatts toll aggregation proxy it, money, it your as attractive a a right? right? said that an Yeah. driven road XXX all never in place, and power The use Brannen

et cetera. in or we're If and cetera, to make in or want to spades all build one two you And what use for see seeing Mexico, purpose in et I think it it you three in We're Rico, Puerto exactly going four. the for you that's Jamaica. that, money,

So math see a I of competition exactly is profitable. more that's really being the to of the we have as get so. the do we the sheet balance we're people in it principle think get that's definitely see. and the going And can bigger to credibility see you infrastructure, here, it, comprehensively. sell terms of of what applied the to you element capital think, of faster, and do have I power. willing Bernoulli's profitability of lot is that's LNG don't kind so do people But larger, shipping And get so to They provide to build that one to doing and of build of

world, like turn become competitive that with more and we've really competitive position. but a and more more day more it's And competitive we So on I every volumes, our it.

to be. place good a that's So

to have execute now. just we So

Operator

Thank you.

Tuohy question next with Craig comes Our from Shere Brothers.

may with proceed You your question.

Craig Shere

really cost or comment this CapEx blend On can in or project the you that at facilities than your target the burn the an either doing economics with XX initial is involved months, in do next a the hydrogen be zero plants? and the And the you the initiative and you're none the LNG proposition doing through with lower can power margin you're all Or LNG? infrastructure? on

Wes Edens

kiss process email, I give lot developing open is we'd the that at And if their capital going absolutely. just going that's all be the invest the and to apply, day it. That's turn make that going people not second be sense, of turn to makes not won't to to is us electrolyzer anything going question the an of I'm things utility to wake next look as how in look and you could it's gas a practical something come up Jake that going answer there think, this. lot couple industrial see They’re economically. of to sometime want pipelines on is. and for – plan. There's nor right? to an building think to We up their weeks. I'm is with tent. plants England. that technologies again, about we're trying everything here going new might off think a And not as to actually that The And it. hydrogen. you're go it frogs, that sense you a and really and say you've of to in at There's talking see Yeah. into that's in you’re a send a then a happen. a got That's way in. in take prepared market, let's lot call, personally to going using scale, love XX% and a We It's injecting good, the different system, one gas to of

it's this, think period think that is capital of to years short But I on a investment invest by and I a a I think it's needs emission-free become try XX short the to company. time firm And period and world an good time. a process. the of

a -- like, that people and I old too think. wait in really carbon the don't goals XXXX, just XXXX. place timeframe. XXXX not think and for in think reasonable honestly, I to I'm I'm XXXX talk see when world's And I I like about a for that's

than do I this is what So happen to going think lot faster people think. a

far see will power those behind it's businesses transportation that I of the in things, think or whether is ships, I its quickly, its happened not more kinds trucks it think cars or but it. you

economics, do it. but So to to, a we project find talk let's it the or about want paper, on we go raw can

what get a sense. it where and like it try then that to actually is. improve really see Let's of place actually to from, to We'll have then real on and a start baseline makes kind

Craig Shere

analogy good just a biomass coal-fired? Is Understood. and like

Chris Guinta

that I a perspective, very from think, scalable, interesting in has something a $X.XX scalable. lot nature. or hydrogen And whatever. $X.XX different at order of different seems can exists in the see for on to has We really mass lot be it be be to potential in hydrogen on forms paper in proposals my produce that they or crazy on of think stuff to doing very people

Just to of the kind raw amount through just you walk it.

electrolyzers efficiency, go, would XXX%. context power a versus kilowatt you are $X.X power, dollar. an is of to create that XXX% hydrogen, had one. Baseload you it's unattainable None a give lot so electrolyzer right, If the and you had obviously $X.XX not the have an to but that $X.XX

the guys. to And people are there cheaper so over get lot trying do can to of just that Those this. field, crazy solar way hydrogen, I that every there's produce which it, the concentrated proposal can to into close hit when said, kind pretty produce doesn't figure you pretty We sound fire, a all and firm pump it that. electrolyzer actually math, a are the to depleted a of a at saw they world to hydrogen. power it take wake claimed through we've go of if they're you that mass-produces light out oxygen said, based similar it, maybe it, And like prices that it. seen you on a on -- from it science that day, guys up It's oil

think that people be out there'll want I a would to do it. lot there of

it. I As trying figure don't out. scientist want the be that of to be I said, I commercializer basically to the mad want to

to being put think our accompaniment go. we to And systems, a be provide and part of great in I want to that it take our And I is to a that’s that's think capital part, t into that. where role. able and, course, and of

Craig Shere

you as the $X.XX figure both Is shipping. Understood. as in the Real Hub correct? the that plus, quick, said well liquefaction that $X.XX addition to the fixed includes Henry

Wes Edens

$X.X, in We're number. that. materially basis, $X.XX, that's got contracts using than much It there term does. a very good conventions does. But and because a really It $X.XX, some old you because needed on this be we've think is it's if and obviously There's that people -- to good question can Spot cards. lots are do prices long the of is quotation it. less clarified

to faster get So be spot turn can brand opportunities faster more that the can to take the we going the the of then advantage can that are we able rates on, on, turn are new out he there. stuff

So ...

Craig Shere

Wes, mentioned low And is possibility plus of terms contract fixed? term the us you costs, question what mix of versus Hub you downstream in in another your remind Henry long Can fixed rate.

Wes Edens

bulk Henry rate all stuff that’s of some really stuff, amount fixed got of modest but have is modest done, it index. some the Hub. we We've almost It's

down our own chunk obviously, the So we're no big really use And whole that China guys prices the I side. on a of And situation, as those have not said fault through of dramatically. world’s come exposed LNG.

that of been around a lot there's So well. as issues

So ...

Craig Shere

math, like consume going you you ever about to is you've or Rico to liquidity more When flow that little you Ireland mentioned may you're you a very on disclosed thing problem after markets combine the about their you're self-funding. the in done, the it's discussion going financing. million some earthquake. that with what other of that five maybe financing whether this need $XXX the finance? you be you largest think By How think the do haven't or forward? question. solve project you're Or cash Nicaragua bulk again? think in been and that Puerto projects about add-on project last all or do the tap to Angola, When got terminal this, the going to free Wes, And you the VR, and our have project from maybe see

Wes Edens

think on about leverage this. talk let's I just Well,

And assets that’s against so, billion said number times million, off Chris the multiply we Take that stuff and about million, XX, million use billion that's have $XX that’s a $XXX it. our in is has in what value. debt running. Right $XXX now dollars that up $X.X it

a from standing against just $X.X a start, that So sound billion highly leverage. billion doesn't

not leverage. it's highly fact, In that

million to stuff and, cash absolutely $XXX lot ability so incrementally we is of cash to And think I of of a debt flow have tap flow. course fund markets free free

of dilutive. thought just accretive, incremental that there it's we you'll one biggest not to as be go and capital very going revisit. tag a one and a combination focused do company. raise cash old we we In the things, shareholder. it's make are flow We're it, If very significant, couple as it's filings, is two I those we're be business, -- on opportunity we self-funding. I'm and to a really we the say, is year we might opportunities the commercial think But shareholders. as sense wanted diluting not there not But then so. the much well if do back that something an see out from there's our debt so to modest So would free amounts of would come bigger it If very,

that. to out do in flow. support I can debt through we cash actually course, self-fund we and are if But that We absolutely incremental the and of there. a we ordinary think is investors access to can So said We the true. we sign makes going that. to -- that we of it there's that. to And a that, them do will think opposite the don't intend fact, free sense. we list things file we long it not we're A intend make shelf sense, need in That's think markets if as But it. material are think very capital actually so would couple a do the I

Operator

comes [Operator Odeon with Hillary from you. Capital. next Thank Instructions] Our Cacanando question

with You question. may your proceed

Hillary Cacanando

do Just also the on take-or-pay, capacity how FSRU? an is required and XX% FSRU would the of you the remaining picked And about Nicaragua you the -- be project the could for with with out have XX% what's contract just on talk structured?

Wes Edens

Chris?

Chris Guinta

Yeah.

remaining XX% by dramatically the The are as at So contract megawatts installed. be capacity caused this of the needs. XXX the can The is country that grid electrified them Nicaragua is under moment.

That's expect exceed So best this we model would the to take-or-pay. XX%.

we've what have in in use we required very base just will gallons capacity service to That assumed a the that's offshore similar off that FSRU terminal excess Harbour. to Old be of XXX megawatts. well numbers. our the send and Nicaragua to will will so The design to FSRU case And service

So certainly, as you see consumed. additional have that volumes in expansion could you market,

a strategic for storage is The for I serve would regional Nicaragua operations. location. as Pacific thing can FSRU other The our mention

synergies La expect there Paz Canal. Nicaragua would is to very So we the as the side the you're Pacific Panama terminal of that bunkering are see potential from close storage to to addition in in servicing opportunities by material the

Hillary Cacanando

And also, now, your little right guess, in view plan liquefiers? talk potential build-out? for what's I you changed Pennsylvania a just market supply your the LNG bit the other about and going on with could upstream your at or all plans Just, has about

Chris Guinta

I good obviously, price us. is for the thing XX% is mean, down. a going

it's that fully we have quiver. to actually long benefits gas building both to another that's permit, so from abundant that that think think that done got an amazing going in on But we'll sense, have We the Pennsylvania. in We've We the the the in cash focus rail about is the we on development era as it. be the is part of having place term, something the that building term, term, we actively not world. and facility, Pennsylvania there, access out pieces And our so. a have it the platform so it’s well think When have it. in we quiver as permitted to having assets, In part of in States. makes we're there work we United short do I obviously as will of parts to a world. very doing a place pursue valuable, we've talking is the the the think short And the flow, companies and we’re keep significant

Hillary Cacanando

And one question. just more

a just seeing Golar markets. to similar you have are clearly you with similar having these into about bit any downstream the the model in business Brazil Just a other a project? little But get market the you with So out to landscape find players strategic looking wanted through could advantage in first-mover model the competitive if

Chris Guinta

Yeah.

of lot there's world. think, I a the competition in

I And scale is to that's the done we've stuff. playbook tried to looking they've lock path and a long-term terrific. And deal think down think now following a guys they're Brazil plant they're have the power and what I very Golar similar in used. small a on our big expand that on

big world. we think end-to-end gigantic there. think pay There's people are we basis everything. to that have a do Good not world electricity. a have people news billion So willing It that it's don't what makes is that on do are sense. from people is and X that for is a And to a of can't out is willing a lot seen afford electricity. billion pretty daily X, There's obviously I that who

today I'm less year not about competition. it it complacent ago. about did -- feel I And a than about concerned so, the I

group And the a and hard lot capable very requires a about. show how this simple simple all make I we're It's It of happen. you things. those to and to it pretty of paper So economics. know focus. actually pretty of talk and it is both lay to people fortunate It's on very, have

competitive no And it. sure. so I But for like complex our a world. about There's position doubt it's

Operator

Alan Thank further further this to I now Andreini you. would call to And I'm over questions back not like for time. turn the any showing at any remarks.

Alan Andreini

today's for call. you Thank all on participating

you to or Jake feel any me, follow-up out free reach questions, Kane to Josh have Suski. please If

Our is our information press on release. contact QX

Finally, you you. we forward Thank QX. to look updating after

Operator

this you concludes call. gentlemen, and participating. for Thank Ladies conference you. Thank today's

not may You disconnect.

New Fortress Energy (NFE) 4 Mar 202019 Q4 Earnings call transcript