Amid efforts to stave off insolvency, New Fortress Energy Inc.—which built a 300-megawatt natural gas power plant in Nicaragua—has reached an agreement with its creditors. The company plans to restructure approximately US$5.7 billion of its debt under a legal framework in the United Kingdom. The strategy also includes splitting the company into two entities and finally bringing its Puerto Sandino plant online in October 2026—five years after it was originally expected to begin generating electricity in 2021.
A financial analyst, who requested anonymity due to fear of reprisals, said the restructuring process could accelerate the launch of the Puerto Sandino facility.
“It may be that by the end of this process the company will carry significantly less debt and have stronger cash flow to support the development and growth of the Nicaragua project,” the analyst said.
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However, the analyst warned that the key factor determining whether the plant becomes operational remains the price of natural gas, which has surged alongside oil. “With the current geopolitical tensions involving the United States, Israel, and Iran, gas prices have risen sharply and remain highly volatile—well above the levels assumed when the Power Purchase Agreement (PPA) was negotiated,” the analyst added.
Gas Prices Could Delay Operations
Under the PPA signed with Nicaragua, a fixed price was established for the electricity to be sold into the national grid. If gas prices exceed projections at the time operations begin, production costs could rise significantly, potentially delaying the plant’s launch.
Still, the analyst noted that gas prices could decline in the coming years as supply increases from the United States and Qatar. “There is a possibility that, at some point, sales prices and operating costs will align, making gas-fired power generation in Nicaragua a viable business,” he said.
In February 2020, Nicaragua’s then Energy and Mines Minister Salvador Mansell—who also serves as executive president of the national transmission company Enatrel—and José Antonio Castañeda, head of the Nicaraguan Energy Institute, signed a 25-year power purchase agreement with New Fortress Energy behind closed doors on behalf of the distribution company Disnorte-Dissur.
Questions Over Energy Pricing
Although the Ortega-Murillo government has not disclosed the agreed purchase price, reports indicate preliminary negotiations hovered around US$110 per megawatt, including capacity charges.
At the time, the international benchmark price for gas-generated electricity was roughly US$65 per megawatt, also including capacity. Even with what appears to be a higher agreed rate, the margin has not been sufficient to ensure the plant’s operational launch.
After months of negotiations—and with the company reportedly considering filing for Chapter 11 bankruptcy protection in the United States—New Fortress Energy announced on March 17 that it had reached a deal with creditors. The agreement forms part of a UK-sanctioned Restructuring Plan (UK RP).
According to the company, court proceedings to approve the plan are expected to begin in April. Subject to judicial scheduling, regulatory approvals, and other conditions, the transaction is anticipated to close in the third quarter of 2026. In the meantime, the company will continue normal operations.
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Company to Split in Two
The restructuring will unfold in multiple stages, beginning with the division of New Fortress Energy into two independent entities.
One, to be called “BrazilCo,” will be a privately held company owned by creditors and will control the firm’s terminals, power plants, and operations in Brazil.
The second entity, “New NFE,” will be publicly traded and focused on liquefied natural gas (LNG) power generation. It will own the company’s assets and operations in Nicaragua, Puerto Rico, and Mexico.
Under the plan, creditor groups will exchange their debt holdings for a package including New NFE debt instruments, preferred shares, and common equity. This package will include up to $2.5 billion in preferred shares with a three-year term and escalating interest rates—3% in the first year, 5% in the second, and 7% in the third—as well as a 65% stake in common equity. New NFE will ultimately become the owner of the Puerto Sandino plant.
New Fortress Energy currently carries total debt of about $9.3 billion and faces severe liquidity constraints. The restructuring aims to reduce corporate debt by $5.7 billion, bringing it down to approximately $527.5 million.
CEO Outlines Turnaround Plan
A day after announcing the deal, founder, chairman, and CEO Wesley Edens said he is confident stakeholders will approve the restructuring.
“This is one of the largest and most successful consensual restructurings ever undertaken,” Edens said during a conference call. “This transaction uses a UK process that allows us to convert debt into equity across our creditor base without disrupting operations—and most importantly, without impacting customer service.”
Edens added that the company expects revenue growth from three major projects, including the Nicaragua plant.
“Beyond our current operations, we anticipate revenue growth driven by three key initiatives. One of them is the completion of the Nicaragua terminal. The power plant itself is finished, and the maritime component is well defined, with clear timelines and budget. We expect the terminal to begin operations in October 2026 following this transaction,” he said.
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A Long-Delayed Project
The Puerto Sandino LNG import terminal consists of a floating storage and regasification unit with a capacity of three million tons per year. According to Edens, the facility is expected to begin contributing to cash flow in 2027.
Edens, a U.S. investor and co-founder of Fortress Investment Group, also founded New Fortress Energy. He is co-owner of the NBA’s Milwaukee Bucks, the English Premier League club Aston Villa, and Portugal’s Vitória SC. His rail company, Brightline, operates high-speed passenger service between Orlando and Miami—the only privately operated intercity rail line in the United States.
New Fortress Energy entered Nicaragua in 2020 with a US$700 million investment to build the 300-megawatt gas-fired power plant. However, despite being completed four years ago, the facility has yet to begin operations. The latest pledge to launch in October 2026 is one of several missed deadlines over the past four years, with no clear explanation for the repeated delays—even though the plant is reportedly ready to operate.
