NextDecade Corp. finalized contracts with Bechtel Energy for construction of Rio Grande Trains 4 and 5, which are awaiting final investment decisions. (Source: Shutterstock)
NextDecade Corp. (NEXT) subsidiaries have finalized contracts with Bechtel Energy for construction of Rio Grande LNG’s Train 4 and related infrastructure and a similar contract for Train 5. Taken together, the contracts are worth $9.09 billion, NextDecade said on June 12.
NextDecade finalized a “pricing refresh” of Bechtel’s lump-sum, turnkey engineering, procurement and construction (EPC) for Train 4, the company said in a press release. Rio Grande LNG Train 4 LLC will pay Bechtel approximately $4.77 billion. Pricing validity under the Train 4 EPC contract extends through Sept. 15.
NextDecade said it projects owner’s costs, contingencies, financing fees and interest during construction will total approximately $1.8 billion to $2.0 billion for Train 4.
Under a separate contract, Rio Grande LNG Train 5 LLC agreed to pay Bechtel approximately $4.32 billion for the work under the EPC contract for Train 5.
Pricing validity under the Train 5 EPC contract extends through Sept. 15. NextDecade currently projects owner’s costs, contingencies, financing fees and interest during construction will total approximately $1.8 billion to $2 billion for Train 5 and supporting infrastructure.
NextDecade said that Trains 4 and 5 are progressing toward final investment decisions (FID).
NextDecade (NEXT) signed a 20-year LNG sale agreement with JERA, Japan’s largest power generator, for offtake from Train 5 of its Rio Grande LNG project in South Texas.
The company said commercialization of Train 4 is complete and it has started the financing process for Train 4 and related infrastructure. Subject to obtaining adequate financing, NextDecade expects to achieve a positive FID on Train 4 before the end of the pricing validity period for the Train 4 EPC contract.
On May 29, NextDecade signed a 20-year LNG sale agreement with Japan’s largest power generator, JERA, for offtake from Train 5 of its Rio Grande LNG project in South Texas. JERA agreed to purchase 2 million tonnes per year (mtpa) of LNG on a free-on-board basis, with pricing indexed to the Henry Hub. The agreement is contingent on an FID for Train 5.
NextDecade is working on commercializing an additional 2.5 mtpa under long-term LNG sales and purchase agreements to support a positive FID on Train 5.
The company 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 the Train 5 EPC contract.
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