ADNOC partners with NextDecade for lower-carbon LNG project in the US

ADNOC announced today the acquisition of an 11.7% stake in Phase 1 (Trains 1-3) of NextDecade Corporation’s Rio Grande LNG, a leading liquefied natural gas (LNG) export project in the US, to produce less carbon-intensive LNG.

ADNOC acquired Phase 1 RGLNG through an investment vehicle of Global Infrastructure Partners (GIP), one of the world’s leading infrastructure investors. 

Additionally, ADNOC and NextDecade have announced a 20-year LNG offtake agreement from RGLNG Train 4.

Meanwhile, NextDecade retains its previously announced expected economic interest in Phase 1, alongside its interests in the expansion capacity of Train 4 and Train 5.

ADNOC’s strategic investment

The Phase 1 acquisition represents ADNOC’s initial strategic investment in the US. This move aligns with its global expansion strategy and supports its goal to enhance its lower-carbon LNG portfolio to meet rising gas demand.

"We are delighted to partner with NextDecade on this world-class lower-carbon LNG project as it marks a significant milestone in ADNOC’s international growth strategy and provides us access to one of the world’s top LNG export markets,” Musabbeh Al Kaabi, Executive Director for Low Carbon Solutions and International Growth at ADNOC, said in the press statement.

As global energy demand rises, ADNOC is expanding its diverse energy portfolio to ensure a secure, reliable, and responsible energy supply to its customers while promoting innovation and delivering greater value.

Rio Grande LNG is on a 984-acre site near Brownsville, Texas. It is the first US LNG project to offer an expected emissions reduction of more than 90% through its innovative proposed carbon capture and storage (CCS) project. The CCS project will capture and permanently store over 5 million metric tons per annum of carbon dioxide (CO2), equivalent to removing 1 million vehicles from the road annually.

Matt Schatzman, NextDecade’s Chairman and Chief Executive Officer, highlighted in his statement, “LNG from our facility will allow ADNOC to further increase its presence in the global LNG market, while also supplying global customers with more affordable and less carbon-intensive LNG.”

ADNOC has acquired an equity stake in Phase 1 (Trains 1-3) of Rio Grande LNG and also secured the option from GIP for equity participation in the future Trains 4 and 5 of the project. NextDecade aims to make the final investment decision (FID) on Train 4 at the Rio Grande LNG Facility in the second half of 2024.