New Fortress Energy Inc ( NFE ) shares are ripping higher in Tuesday’s after-hours session after the company announced a long-term gas supply agreement with the Puerto Rican government.

What To Know: New Fortress said it reached an agreement on contract terms with the Third-Party Procurement Office and the Puerto Rico Public-Private Partnerships Authority for the long-term supply of liquefied natural gas to Puerto Rico.

New Fortress will provide a reliable and affordable supply of natural gas to Puerto Rico’s power system for a term of seven years under the supply agreement.

“We have had discussions on long-term fuel supply since April with the Government of Puerto Rico and are pleased to have reached an agreement,” said Wes Edens, chairman and CEO of New Fortress Energy ( NFE ).

The gas supply agreement is expected to help secure supply for Puerto Rico for the next seven years and allow for the conversion of additional gas-ready plants currently burning diesel. Up to 75 TBtu of natural gas per year can be supplied through the agreement.

“This is a milestone agreement for NFE and the government of Puerto Rico. Puerto Ricans pay far too much for electricity today and this long-term agreement provides cheaper and cleaner fuel for existing power plants for years to come,” Edens added.

NFE Price Action: New Fortress Energy ( NFE ) shares were up 20.49% in after-hours, trading at $2.45 at the time of publication on Tuesday, according to Benzinga Pro. The shares closed the day up 44.93%

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