NextDecade says to take Rio Grande LNG FID in early July

US LNG terminal developer NextDecade is now expecting to take a final investment decision on the first three trains of its Rio Grande LNG export project in Texas in early July.

The firm announced in a statement on Thursday that Rio Grande LNG has received binding commitments from a syndicate of lenders in an amount sufficient, together with expected project equity funding, to support a positive FID of the first three liquefaction trains.

According to NextDecade, the lender group includes the world’s leading Asian, European, Middle Eastern, and North American project finance banks.

NextDecade said it had sold 16.2 million tonnes per annum of LNG from Phase 1, or 92 percent of nameplate capacity, under long-term sale and purchase agreements, sufficient to support the binding debt commitments from these leading lenders and the near-term FID of the 17.61 mtpa Phase 1.

The Rio Grande LNG developer previously expected to take FID on the first phase before the end of the second quarter.

“Due in part to the observance of various holidays around the world, including the July 4th holiday, NextDecade is now targeting FID on Phase 1 in early July with FIDs of its remaining trains to follow thereafter,” it said.

NextDecade recently entered into framework deals with compatriot Global Infrastructure Partners (GIP) and France’s TotalEnergies.

Under the deals, GIP would become a majority investor in Phase 1 and TotalEnergies would become a 16.67 percent investor, both subject to execution of definitive documentation and FID.

In addition, TotalEnergies has agreed to purchase 5.4 million tonnes per annum of LNG from Phase 1 for 20 years on a free on board basis indexed to Henry Hub and has options to purchase LNG from Train 4 and Train 5, NextDecade said.

First cargoes in 2027

First LNG cargoes from the first phase of the project are expected in 2027.

NextDecade has two lump-sum turnkey EPC contracts with Bechtel for the LNG export project for the first three trains. The full project would include five trains with a capacity of 27 mtpa.

The first deal is for two LNG trains with a capacity of some 11.74 mtpa, two 180,000-cbm tanks, and one marine loading berth, while the second deal is for one LNG train with a capacity of 5.87 mtpa.

Prior to FID, NextDecade issued a limited notice to proceed to Bechtel last year to begin ramping up its personnel and initiate site preparation work at the Rio Grande LNG site.

Early works on the site include deep soil mixing, land clearing at test pile locations, onsite surveys, etc.

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