NextDecade secures up to $1.8bn funding for Rio Grande LNG Train 4
US liquefied natural gas (LNG) developer NextDecade has lined up up to $1.8 billion in equity commitments from TotalEnergies and Global Infrastructure Partners (GIP) to finance a fourth liquefaction train at its Rio Grande LNG export project in Texas, according to a regulatory filing on 11 August.
The funding moves the company closer to a final investment decision on the 5.4 million tonnes per annum (mtpa) Train 4 facility. However, the project still awaits supplemental environmental approval, despite US federal regulators having completed the final environmental impact statement and recommending the project be allowed to proceed last week.
TotalEnergies will contribute around $300 million for a 10% stake in the Train 4 joint venture. A GIP affiliate will invest up to $1.5 billion for a 50% interest, which will later reduce to 30% once agreed return thresholds are met. NextDecade, through its subsidiaries, will provide up to $1.2 billion for a 40% interest, potentially rising to 60% after GIP’s returns target is achieved.
TotalEnergies already has a long-term deal to purchase 1.5 mtpa of LNG from Train 4 but has opted not to invest in, or secure supply from, the proposed Train 5 facility.
NextDecade has signed a fixed-price engineering, procurement and construction contract with Bechtel for Train 4, valued at $4.77 billion. The price holds until 15 September.
The Rio Grande LNG facility is designed for 17.6 mtpa capacity across its first three trains, with Trains 4 and 5 planned to add a further 10.8 mtpa. The expansion will help sustain the United States’ position as the world’s largest LNG exporter.
