(Oil Price)– U.S. LNG developer NextDecade Corporation has decided to invest $6.7 billion in the expansion of its Rio Grande LNG facility in Texas in another boost to America’s LNG export capacity in the coming years.
NextDecade has just announced a positive final investment decision (FID) on Train 5 at Rio Grande LNG, closed financial transactions to fully fund Train 5 and related infrastructure, and issued full notice to proceed to Bechtel Energy for Train 5.
Project costs for Train 5 and related infrastructure are expected to total approximately $6.7 billion, including engineering, procurement, and construction (EPC) costs, owner’s costs, contingencies, financing fees and interest during construction.
Train 5 has expected LNG production capacity of about 6 million tonnes per annum (MTPA), bringing the total expected LNG production capacity under construction at Rio Grande LNG to approximately 30 MTPA.
Train 5 is commercially supported by 4.5 MTPA of 20-year LNG sales agreements with JERA, EQT Corporation, and ConocoPhillips. The guaranteed substantial completion date for Train 5, as well as the date of first commercial delivery (DFCD) under the Train 5 LNG sales deals, is anticipated in the first half of 2031, NextDecade said.
Just last month, the company announced a positive FID on Train 4 at Rio Grande.
This year, U.S. LNG developers have been encouraged by the Trump Administration’s reversal of the Biden Administration’s pause on new LNG project approvals and are taking advantage of the market and regulatory tailwinds to approve investments in new projects.
So far this year, Australia’s Woodside has announced the FID for the Louisiana LNG project and plans to start production in 2029. Venture Global in July took FID and successfully closed the $15.1 billion project financing for the first phase of the company’s third project, CP2 LNG (CP2), together with the associated CP Express Pipeline. And top U.S. exporter Cheniere has made a positive FID for the Corpus Christi Midscale Trains 8 & 9 and Debottlenecking Project.
More projects are expected to take FID this year and in the coming years, amid a growing pipeline of proposals.
In the near term, the U.S. is set to add 5 billion cubic feet per day (Bcf/d) in LNG export capacity in 2025 and 2026 alone, as Plaquemines LNG and Corpus Christi LNG Stage 3 projects come online, the Energy Information Administration said in its latest Short-Term Energy Outlook last week.
By Tsvetana Paraskova for Oilprice.com
