LNG

Texas LNG, the liquefied natural gas export plant to be constructed by New York-based Glenfarne Group in the Port of Brownsville, has received its last regulatory clearances opening the way for a final investment decision.

French bank Société Générale has confirmed it was no longer an advisor to US energy company NextDecade Corp’s Rio Grande liquefied natural gas export project in Texas, which is nearing a final investment decision and has signed up a top list of global buyers from the US to China.

As the project's mandated financial advisor, Société Générale had been the lead bank in preparing financing for the LNG plant before exiting the role.

NextDecade had appointed Société Générale in May 2017 along with Australia’s Macquarie Capital to act as joint financial advisors for the debt and equity financing of the Rio Grande project at the port of Brownsville.

Société Générale and Macquarie have each played extensive roles in advising and participating in debt and equity financing for large-scale infrastructure and LNG projects in the US and elsewhere.

Engaged since 2017

France’s SocGen had been an advisor since just before the US Rio Grande LNG project listed on the US-based Nasdaq global stock exchange in July 2017 as NextDecade.

NextDecade was then run by former Shell senior executive, the late Kathleen Eisbrenner, who had organised the listing and taken the company forward.

Without commenting on the reason for this specific exit, SocGen said that energy sector commitments were set to end all reserve-based lending to US onshore projects by the end of 2023 and to only participate in financing LNG projects aligned with the bank's engagement in policies promoting a strict Net Zero doctrine.

“At Société Générale, we believe that banks have a key role to play in the positive transformations of the world and the sustainable development of economies. In line with our corporate purpose, we have placed sustainable development - and the energy transition in particular - at the heart of our strategy,” the bank states grandly, while noting it was a founder member in 2021 of the “Net-Zero Banking Alliance”.

The Paris-based bank has pledged to commit itself to aligning its portfolios to trajectories aimed at global carbon neutrality.

The bank has said recently it was reinforcing its objective to radically reduce exposure to the oil and gas production sector by 2025.

Confirmation

NextDecade said on March 28 that Australia's Macquarie is still a financial advisor of the company along with Japan’s largest bank, Mitsubishi UFJ Financial Group, and confirmed that Société Générale ended a five-year relationship with the Houston-based company in 2022.

NextDecade earlier in March 2023 amended its engineering contract agreement with US company Bechtel Energy to extend the price validity of the engineering, procurement and construction contract for the building of the first three liquefaction Trains 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

The final EPC lump-sum contract pricing for Trains 1-3 of the Rio Grande facility will be determined prior to an FID being announced.

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.

Environmental permits

Next Decade has ultimate plans and permits to produce up to 27 MTPA of LNG from five liquefaction Trains at the Rio Grande facility.

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.

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.

Nov 18 (LNGJ) - NextDecade Corp., developer of the Rio Grande LNG export project in Texas, said that after a competitive bid and contracting process it had selected Great Lakes Dredge and Dock Corp. to perform improvements near its planned facility on the Brownsville Ship Channel.

   “These improvements, which include deepening the Channel, will enhance commercial navigation into and out of the Port of Brownsville, ensuring the safe and reliable access of LNG carriers to NextDecade’s Rio Grande LNG facility and optimizing the ability of shallower draft traffic to pass LNG carriers in either direction in accordance with US Coast Guard guidelines,” the company explained. 

NextDecade Corp., the Houston-based developer of the Rio Grande LNG export plant in the Texan port of Brownsville, will have five liquefaction Trains instead of six while maintaining annual output of 27 million tonnes per annum.