NextDecade Provides Fourth Quarter 2024 Business Update
Outlines Development Plans for Approximately 18 MTPA of Additional Liquefaction Capacity
CEO Commentary
“As we begin 2025, we are at an exciting time in NextDecade history. Our team is working diligently to capitalize on our outsized growth opportunities while continuing to construct Trains 1 through 3 (Phase 1) at the Rio Grande LNG Facility safely, on schedule, and on budget,” said Matt Schatzman, NextDecade’s Chairman and Chief Executive Officer. “We are working with multiple potential commercial counterparties to progress Trains 4 and 5 toward positive final investment decisions (FIDs), and we believe we are well positioned to secure commercial support for both trains.”
“Today, we are also pleased to announce development plans for expansion capacity at the Rio Grande LNG Facility site beyond Trains 1 through 5. We are currently developing and preparing to start the permitting process for Train 6 and starting the development of Trains 7 and 8. Train 6 is being developed inside the existing levee at the site, which is expected to provide advantages in site preparation and expected economics. We plan to pre-file an application with the Federal Regulatory Energy Commission (FERC) for Train 6 this year. Trains 7 and 8 are being developed on the site outside of the existing levee. Additionally, we expect to explore options for the development of up to two additional trains at our site beyond Train 8.”
Significant Recent Developments
Construction
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Under the EPC contracts with Bechtel Energy Inc. (Bechtel), Phase 1 progress is tracked for Train 1, Train 2, and the common facilities on a combined basis and Train 3 on a separate basis. As of January 2025:
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The overall project completion percentage for Trains 1 and 2 and the common facilities of the Rio Grande LNG Facility was
38.1% , which is in line with the schedule under the EPC contract. Within this project completion percentage, engineering was84.9% complete, procurement was69.2% complete, and construction was10.6% complete. -
The overall project completion percentage for Train 3 of the Rio Grande LNG Facility was
15.3% , which is also in line with the schedule under the EPC contract. Within this project completion percentage, engineering was33.5% complete, procurement was32.8% complete, and construction was0.4% complete.
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The overall project completion percentage for Trains 1 and 2 and the common facilities of the Rio Grande LNG Facility was
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In February 2025, the Company provided additional information regarding its development of additional liquefaction capacity at the Rio Grande LNG Facility beyond Trains 1 through 5. Trains 6 through 8 are wholly owned by NextDecade and are cumulatively expected to increase the Company's total liquefaction capacity by approximately 18 MTPA once constructed and placed into operation.
- Train 6, with expected LNG production capacity of approximately 6 MTPA, is being developed inside the existing levee at the site and adjacent to Trains 1 through 5. A pre-filing application with FERC for Train 6 is expected in 2025, and a full FERC application is expected in early 2026.
- Trains 7 and 8, with a total expected LNG production capacity of approximately 12 MTPA, are being developed on the site outside of the existing levee.
Financial
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In December 2024, the Company’s wholly-owned subsidiary, Rio Grande LNG Super Holdings, LLC, entered into a credit agreement (the Corporate Credit Agreement) which provided for a
senior secured loan. Proceeds from the senior secured loan were disbursed at closing on December 31, 2024, and net proceeds were used to repay outstanding borrowings under the Company’s existing$175 million revolving credit facility and$50 million interest term loan, and will be used to fund working capital and general corporate purposes, including development expenses for expansion trains at the Rio Grande LNG Facility. Borrowings under the senior secured loan bear interest at$12.5 million 12.0% , with interest payable quarterly. Interest may be paid in-kind until March 31, 2027, and up to50% in-kind thereafter. The senior secured loan matures six years from the closing date.
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In conjunction with the closing of the Corporate Credit Agreement, the Company issued warrants in two equal tranches that are exercisable for an aggregate of approximately 7.2 million shares of NextDecade common stock to the lender of the senior secured loan. The warrants are exercisable for five years after the closing date. The first tranche of the warrants are exercisable at
per share, which represents the 30-day volume weighted average trading price for the 30 trading-day period immediately preceding the closing date, and the second tranche of the warrants are exercisable at$7.15 per share.$9.30
Regulatory
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In August 2024, the
U.S. Court of Appeals for the D.C. Circuit (the Court) issued a decision vacating FERC’s reauthorization of the Rio Grande LNG Facility on the grounds that FERC should have issued a supplemental Environmental Impact Statement (EIS) during its reauthorization process.
- On September 13, 2024, FERC issued notice of its intent to prepare a supplemental EIS in response to the Court’s decision. The notice set forth a schedule providing for the issuance of a draft of the supplemental EIS in March 2025, the final supplemental EIS by the end of July 2025, and issuance of a final order by November 20, 2025.
- On October 21, 2024, the Company filed a petition for rehearing and rehearing en banc with the Court. On December 9, 2024, petitioners in the case and FERC filed responses to the Company’s request for rehearing, and the Court’s decision is pending.
- The Court’s decision will not be effective until the Court has issued its mandate, which is not expected to occur until after the appeals process has been completed. At this time, construction continues on Phase 1 at the Rio Grande LNG Facility.
- The Company expects to take all available legal and regulatory actions, including appellate actions, to ensure that construction on Phase 1 will continue and that necessary regulatory approvals will be maintained to enable a positive FID on Trains 4 and 5 at the Rio Grande LNG Facility.
Rio Grande LNG Facility
NextDecade is constructing and developing the Rio Grande LNG Facility on the north shore of the Brownsville Ship Channel in south
Phase 1 (Trains 1-3)
Phase 1 at the Rio Grande LNG Facility is under construction. Phase 1 includes three liquefaction trains with a total nameplate capacity of approximately 18 MTPA of LNG production, two 180,000 cubic meter full containment LNG storage tanks, and two jetty berthing structures designed to load LNG carriers up to 216,000 cubic meters in capacity. Phase 1 also includes associated site infrastructure and common facilities including feed gas pretreatment facilities, electric and water utilities, two totally enclosed ground flares for the LNG tanks and marine facilities, two ground flares for the liquefaction trains, roads, levees surrounding the development area, and warehouses, administrative, operations control room, and maintenance buildings.
As of January 2025, progress on Trains 1 through 3 is in line with the schedule under the EPC contracts. During the fourth quarter and early 2025, the construction team continued steel assembly in the Train 1 area and adjacent pipe racks. Within Train 2, foundations were progressed and steel assembly began. Tank 1 roof panels were set in place, and the first wall concrete pour for Tank 2 was completed. Across the site, Bechtel’s work also continues on installing underground structures, loading berths, piling, concrete foundations, and other siteworks. Bechtel has materially completed purchase orders for critical and high-value items for Phase 1.
NextDecade holds equity interests in the Phase 1 joint venture that entitle it to receive up to
Final Investment Decision on Train 4 and Train 5
We expect to make a positive FID and commence construction on Trains 4 and 5 and related infrastructure at the Rio Grande LNG Facility, subject to, among other things, maintaining requisite governmental approvals, finalizing and entering into EPC contracts, entering into appropriate commercial arrangements, and obtaining adequate financing to construct each train and related infrastructure.
The Company has finalized an EPC contract with Bechtel for Train 4 and related infrastructure. Pricing under the EPC Contract for Train 4 was valid through December 31, 2024, and a pricing refresh is in process and is expected to be completed in 2025.
The Company continues to advance commercial discussions with multiple potential counterparties and expects to finalize commercial arrangements for Train 4 in the coming months to support a positive FID on Train 4. The Company entered into an LNG SPA with ADNOC for the sale of 1.9 MTPA of LNG from Train 4, as well as a non-binding Heads of Agreement (HoA) with Aramco for a 20-year SPA for the sale of 1.2 MTPA of LNG from Train 4. The Company is working with Aramco to finalize a binding SPA. Additionally, an affiliate of TotalEnergies SE (TotalEnergies) has an LNG purchase option of 1.5 MTPA for Train 4, and the Company expects TotalEnergies to exercise the option.
The Company expects to finance construction of Train 4 and associated infrastructure utilizing a combination of debt and equity funding. The Company expects to enter into bank facilities for the debt portion of the funding. In connection with consummating the Rio Grande Phase 1 equity joint venture, the Company's equity partners each have options to invest in Train 4 equity, which, if exercised, would provide approximately
The Company is also progressing the development and commercialization of Train 5. TotalEnergies holds an LNG purchase option for 1.5 MTPA for Train 5, and the Rio Grande Phase 1 equity partners have options to invest in Train 5 equity which are identical to their options to participate in Train 4 equity.
Development of Additional Liquefaction Capacity
The Company is developing and beginning the permitting process for additional liquefaction capacity at the Rio Grande LNG Facility site beyond Trains 1 through 5. Trains 6 through 8 are wholly owned by NextDecade and are cumulatively expected to increase the Company's total liquefaction capacity by approximately 18 MTPA once constructed and placed into operation.
Train 6 is being developed inside the existing levee at the Rio Grande LNG Facility site and adjacent to Trains 1 through 5. The Company expects to pre-file an application with FERC for Train 6 in 2025 and a full application with FERC in early 2026. Trains 7 and 8 are being developed on the site outside of the existing levee.
Investor Presentation
NextDecade has posted an updated investor presentation to its website concurrently with this release. A copy of this release and the investor presentation can be found on its website at investors.next-decade.com.
About NextDecade Corporation
NextDecade is committed to providing the world access to reliable, lower carbon energy. We are focused on delivering secure, low-cost, and sustainable energy solutions through the safe and efficient development and operation of natural gas liquefaction and carbon capture and storage infrastructure. Through our subsidiaries, we are developing and constructing the Rio Grande LNG natural gas liquefaction and export facility near
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of
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NextDecade Contacts
Investors
Megan Light
mlight@next-decade.com
832-981-6583
Media
Susan Richardson
srichardson@next-decade.com
832-413-6400
Source: NextDecade Corporation