NextDecade confirms non-binding accord with Saudis for supply of LNG from future fourth liquefaction Train

NextDecade Corp., the developer of the Rio Grande LNG export plant in Texas, confirmed a non-binding accord with Saudi Arabia for the supply of cargoes from the future Train 4 of the plant being constructed at the Port of Brownsville.

The Heads of Agreement (HoA) was for 20 years with the upstream division of the Saudi Arabian Oil Company (Aramco).

The Rio Grande project is located on 984 acres of land which has been leased long term and includes 15,000 feet of frontage on the Brownsville Ship Channel.

The venture has received all necessary approvals and authorizations required for construction, including those from the Federal Energy Regulatory Commission , which allow for development, construction and operation of up to five Trains and 27 million tonnes per annum of LNG exports.

Under the terms of the HoA, aramco expects to purchase 1.2 MTPA of LNG at a price indexed to the US benchmark Henry Hub price.

The NextDecade-Aramco accord would be subject to a positive final investment decision on Train 4.

Finalising terms

“We look forward to finalizing the terms of a long-term LNG offtake agreement with NextDecade, as we explore opportunities to expand our presence in international energy markets,” said Nasir K. Al-Naimi, Aramco Upstream President.

“We expect LNG to play an important role in meeting the rising demand for secure and efficient energy,” added Al-Naimi.

Matt Schatzman, NextDecade Chairman and Chief Executive, said he was pleased with the Saudi accord.

“We look forward to finalizing the LNG Sale and Purchase Agreement with Aramco and to pursuing other opportunities together,” Schatzman stated.

NextDecade is targeting an investment decision on Train 4 in the second half of 2024, subject to finalizing and entering into an engineering, procurement and construction (EPC) contract, gaining appropriate commercial support, and obtaining adequate financing to construct Train 4 and related infrastructure.

The Phase 1 construction at the Rio Grande plant includes three liquefaction Trains with a total nameplate capacity of 17.61 MTPA of LNG production, two 180,000 cubic metres full containment LNG storage tanks and two jetty berthing structures designed to load LNG carriers up to 216,000 cubic meters in capacity.

Phase 1 also includes associated site infrastructure and common facilities including feed gas pre-treatment facilities, electric and water utilities, two totally enclosed ground flares for the LNG tanks and roads and levees surrounding the entire site.