NextDecade Corporation said its subsidiaries have finalized a pricing refresh of the company’s lump-sum, turnkey engineering, procurement and construction (EPC) contract with Bechtel Energy Inc. for the construction of Train 4 and related infrastructure at the Rio Grande LNG facility in Brownsville, Texas.
NextDecade also entered into a lump-sum, turnkey EPC contract with Bechtel for the construction of Train 5 and related infrastructure at the Rio Grande LNG facility, the company said in a news release.
The company’s subsidiary Rio Grande LNG Train 4 LLC has agreed to pay Bechtel approximately $4.77 billion for the work under the EPC contract for Train 4, with pricing validity extending through September 15, according to the release.
NextDecade said it anticipates that owner’s costs, contingencies, financing fees and interest during construction will total approximately $1.8 billion to $2.0 billion for Train 4 and supporting infrastructure, based on current estimates and expected interest rates.
Further, Rio Grande LNG Train 5 LLC has agreed to pay Bechtel approximately $4.32 billion for the work under the EPC contract for Train 5, with pricing validity also extending through September 15.
For Train 5, NextDecade said it projects that owner’s costs, contingencies, financing fees and interest during construction will total about $1.8 billion to $2.0 billion for Train 5 and supporting infrastructure, based on current estimates and expected interest rates.
With the commercialization of Train 4 complete, the company said it has started the financing process for Train 4 and related infrastructure. Subject to obtaining adequate financing, NextDecade expects to achieve a positive financial investment decision (FID) on Train 4 before the end of the pricing validity period for its EPC contract.
NextDecade recently announced a 20-year liquefied natural gas (LNG) sale and purchase agreement (SPA) with JERA 2.0 for 2 million metric tons per annum (mtpa) for offtake from Train 5. The company said it is working on commercializing an additional 2.5 mtpa under long-term LNG SPAs to support a positive FID on Train 5.
The company said it has started the financing process for Train 5 and related infrastructure and, subject to obtaining appropriate commercial support and financing, is targeting FID before the end of the pricing validity period for its EPC contract.
NextDecade is constructing and developing the Rio Grande LNG facility on the north shore of the Brownsville Ship Channel in south Texas. The site is located on 984 acres of land which has been leased long-term and includes 15,000 feet of frontage on the Brownsville Ship Channel, according to an earlier statement.
The company said it believes the site is “advantaged due to its proximity to abundant natural gas resources in the Permian Basin and Eagle Ford Shale, access to an uncongested waterway for vessel loading, and location in a region that has historically been subject to fewer and less severe weather events relative to other locations along the U.S. Gulf Coast.”
The facility has been permitted by the Federal Energy Regulatory Commission (FERC) and authorized by the U.S. Department of Energy to export of up to 27 mtpa of LNG. Phase 1 of the facility is under construction, and the company said it is developing and beginning the permitting process for Trains 6 through 8.
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 its total liquefaction capacity by approximately 18 MTPA once constructed and placed into operation, according to the statement.
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 said, adding that it expects to pre-file an application with FERC for Train 6 within the year and a full application with FERC in early 2026. Trains 7 and 8 are being developed on the site outside of the existing levee, the company noted.
To contact the author, email rocky.teodoro@rigzone.com
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