This story requires a subscription
This includes a single user license.
In July 2023, NextDecade took the final investment decision on the first three Rio Grande trains and completed $18.4 billion project financing. The first phase includes bundling two 180,000-cbm full containment LNG storage tanks, and two jetties designed to load LNG carriers up to 216,000 cbm in capacity.
NextDecade awarded the $12 billion EPC contract to compatriot Bechtel, and it officially kicked off work on the plant in October 2023.
According to Rio Grande LNG’s January construction report sent to the US FERC, the project continued wall construction on LNG Tanks 1 and 2.
In addition, the project started aboveground pipe installation within LNG Train 1 and associated OSBL areas following the issuance of authorization on January 30.
It also started placing LNG Tank 1 roof panels on location.
Besides LNG tanks, the project continued installation of pre-cast concrete columns for Train 1 compressor string B foundation, land-based construction of Jetties 1 and, and Train 3 soil stabilization via deep mixing method.
The project also started structural steel erection for 800R1 outside battery limits (OSBL) and placement of topsoil on perimeter levee.
For February, Rio Grande LNG’s anticipated activities include starting equipment setting of air coolers in the 190R piperack in Train 1, pipe staging in the 290R piperack for Train 2, starting civil foundation activities for the central control Building and in the 390R piperack in Train 1.
Expansion planned
NextDecade previously closed a joint venture agreement for the first phase which included about $5.9 billion of financial commitments from Global Infrastructure Partners (GIP), GIC, Mubadala, and TotalEnergies.
The company holds equity interests in the Phase 1 joint venture that entitle it to receive up to 20.8 percent of the distributions of available cash during operations.
Phase 1, with nameplate liquefaction capacity of 17.6 mtpa, has 16.2 mtpa of long-term binding LNG sale and purchase agreements.
These include deals with TotalEnergies, Shell, ENN, Engie, ExxonMobil, Guangdong Energy Group, China Gas Hongda Energy Trading, Galp, and also Itochu.
Including trains 4 and 5, the Rio Grande LNG facility would have a capacity of 27 mtpa.
In August 2024, NextDecade signed a lump sum turnkey engineering, procurement, and construction (EPC) contract with Bechtel for the construction of the fourth train and related infrastructure at the Rio Grande LNG facility.
The company’s unit Rio Grande LNG Train 4 agreed to pay Bechtel about $4.3 billion for the work under the EPC contract.
Total estimated project costs are expected to be $6-$6.2 billion for Train 4 and related infrastructure, in line with the per train cost of the three-train Phase 1 at the Rio Grande LNG facility.
Achieving a positive FID on trains 4 and 5 at the Rio Grande LNG Facility will be subject to, among other things, maintaining requisite governmental approvals, finalizing and entering into EPC contracts, entering into appropriate commercial arrangements, and obtaining adequate financing to construct each train and related infrastructure, NextDecade said.
Regulatory actions
In October 2024, NextDecade recently sought a rehearing of the D.C. Circuit Court’s ruling on its Rio Grande LNG project in Texas.
Prior to that, the US Court of Appeals for the D.C. Circuit issued an order vacating the Federal Energy Regulatory Commission’s remand authorization of NextDecade’s Rio Grande LNG facility on the grounds that the FERC should have issued a supplemental environmental impact statement (EIS) during its remand process.
The Court’s decision will not become effective while the appeals process is ongoing.
In September 2024, FERC said it will prepare a supplemental environmental impact statement for the Rio Grande LNG project.
In the meantime, Donald Trump became the new US President and already made significant moves related to the US LNG industry.
Last month, Trump lifted a moratorium by the former Biden administration on non-FTA LNG export permits.
Trump issued the executive order, which was widely expected, just hours after officially taking over his second four-year term as the president.
The US DOE just issued a conditional non-FTA approval to Kimmeridge’s Commonwealth LNG, and this is the first non-FTA approval since the moratorium was lifted.