NextDecade Corp., the developer of the Rio Grande LNG export project on the Brownsville Ship Channel in Texas, has amended its engineering contract agreement with US company Bechtel Energy to extend the price validity.
The engineering, procurement and construction contract with Bechtel for the building of the first three liquefaction Trains has been extended to June 15, 2023.
“NextDecade currently estimates the aggregate lump-sum EPC cost to construct Trains 1-3 of the Rio Grande Facility at approximately $11.5 billion,” said NextDecade in a statement to the Nasdaq global exchange.
“The final EPC lump-sum contract pricing for Trains 1-3 of the Rio Grande facility will be determined prior to a final investment decision and is subject to change, including if RGLNG does not issue a full notice to proceed to Bechtel on or before June 15, unless extended by mutual agreement of the parties thereto,” the company explained.
NextDecade said that it was currently targeting a positive FID on Trains 1-3 of the Rio Grande project before the end of the second quarter of 2023, with FIDs on the remaining Trains to follow later.
Houston, Texas-based Next Decade has ultimate plans and permits to produce up to 27 MTPA of LNG from five liquefaction Trains at the Rio Grande facility.
Numerous delays
The Rio Grande project has been delayed on numerous occasions over the years and was originally expected to start producing LNG in 2023.
NextDecade signed about half a dozen sales and purchase agreements (SPAs) in 2022, the most recent being a volume increase in December with ENN LNG of Singapore, a trading unit of the Chinese ENN Natural Gas Group.
Under the 20-year SPA, ENN will now purchase 2.0 MTPA of LNG. NextDecade said this was a 500,000 tonnes per annum increase from the original 1.5 MTPA SPA announced earlier in 2022.
All volumes of LNG are indexed to the US benchmark Henry Hub natural gas price and will be supplied from the first three Trains at the Rio Grande facility.
Portugal deal
NextDecade earlier in December 2022 signed an SPA with Galp Trading S.A. of Portugal.
This was its fifth deal of the year and the increase of volumes for ENN Group was its sixth volume sign-up.
NextDecade has made progress with other SPAs during 2022, including one with ExxonMobil Corp.
The US major signed a 20-year supply deal with NextDecade at the end of July 2022 through its trading subsidiary in Asia.
NextDecade has also signed three supply agreement with Chinese companies, including a 20-year deal with China Gas Hongda Energy Trading Co., a wholly-owned subsidiary of China Gas Holdings, the ENN Group and with Guangdong Energy Group Natural Gas.
