LNG

NextDecade Corp. of the US and North American pipeline company Enbridge Inc. of Canada, entered into a definitive agreement whereby Enbridge would acquire the Rio Bravo Pipeline Company from NextDecade, developer of the Rio Grande LNG export project.

IEnova, the Mexican subsidiary of California-based utility Sempra Energy and developer of the Costa Azul LNG export terminal on the Pacific Coast of Mexico, said third-quarter earnings declined, though it expected future profits from the commercial start-up of the new natural gas pipeline from Texas to Mexico.

The US Annova liquefied natural gas export project planned for the south bank of the Brownsville Ship Channel in Texas, and whose owners include Chicago-based power company Exelon Corp., has concluded a tax deal in Texas showing the encouragement being offered to the build-out of the LNG sector along the Gulf Coast.

NextDecade Corp., the Texas LNG project company has signed an accord with Enbridge Inc, the Canadian pipeline company, to jointly develop pipelines in South Texas to take feed-gas to the Rio Grande LNG export plant planned for the Port of Brownsville.

NextDecade is planning the Rio Grande liquefaction facility and its associated Rio Bravo Pipeline.

Rio Bravo is designed to transport 4.5 billion cubic feet per day of natural gas from the Agua Dulce area to the Rio Grande export plant at Brownsville.

NextDecade said its intention is to develop an export path for natural gas from the Permian Basin to the global LNG market.

Under current plans, NextDecade’s Rio Grande plant will have capacity to produce around 27 million tonnes per annum of LNG.

“Enbridge is one of North America’s leading energy infrastructure companies and we look forward to exploring a strong partnership in South Texas,” said NextDecade Chairman and Chief Executive Matt Schatzman.

“With its Texas Eastern Pipeline and recently completed Valley Crossing Pipeline, Enbridge has extensive permitting, construction, and operating experience in the State of Texas, especially in South Texas,” added Schatzman.

Bill Yardley, Enbridge’s President of Gas Transmission and Midstream, said the Toronto-listed company was excited to be working with NextDecade for pipeline solutions in the US export market.

“Our existing infrastructure fits very well with the Brownsville location,” explained Yardley.

“This is a continuation of our strategy to bring our major projects execution and permitting capability to the expanding LNG export efforts in North America,” he stated.

Both companies anticipate finalizing definitive documentation reflecting the terms of their current accord in the fourth quarter of 2019.

The Rio Grande project in May 2019 signed fully wrapped lump-sum turnkey engineering, procurement and construction contracts with Bechtel, including cost, schedule and performance guarantees.

The EPC contracts are for the first phase of the Rio Grande facility, comprising three liquefaction Trains, two 180,000 cubic metres storage tanks and two marine berths totaling exactly $9.56 billion.

Each Rio Grande liquefaction train for the Brownsville plant is expected to have capacity up to 5.87 MTPA, which would generate an EPC cost of around $543 per ton for the first three Trains.

NextDecade Corp., developer of the Rio Grande LNG project in Texas and other ventures, has agreed to sell convertible preferred stock to funds managed by US equity firm BlackRock after earlier in August selling $50 million of stock to other funds.

Mexico is continuing to import growing volumes of pipeline natural gas and LNG as monthly shipments increased by more than 13 percent from the US cross-border pipelines and in the form of cargoes from the Sabine Pass liquefaction plant in the US state of Louisiana and other LNG exporting countries such as Nigeria and Peru.

Galveston Bay LNG, a project planned by Houston-based company NextDecade, has been authorized by the US Department of Energy to export up to 785.5 billion cubic feet per annum, the equivalent of 16.5 million tonnes of LNG, from its proposed liquefaction facility in Texas City.

NextDecade, the company proposing to build the Rio Grande liquefied natural gas export plant in Texas, named Ping Lee as its main LNG marketing executive for China and Southeast Asia.