NextDecade Proceeds With Texas LNG Plant Phase 1 Construction, Projects Gets Massive $18.4B Financing

NextDecade Corp NEXT disclosed the final investment decision (FID) related to the Phase 1 construction at its Rio Grande LNG (RGLNG) export facility in Brownsville, Texas.

The company planned to proceed with RGLNG Phase 1, which includes building the first three liquefaction trains at the 27 million tonnes per annum (MTPA) facility.

The project has financing of $18.4 billion, the largest greenfield energy project financing in U.S. history. 

The financing includes a joint venture deal, with around $5.9 billion of commitments from TotalEnergies SE TTE, GIC, Global Infrastructure Partners (GIP), and Mubadala Investment Company. 

As per the JV, NEXT is entitled to receive up to 20.8% of the cash flows generated by Phase 1, while TTE is entitled to get 16.7% and other companies 62.5%. 

The agreements further provide the companies options to invest in RGLNG Train 4 and Train 5 and an opportunity to invest in the planned carbon capture and sequestration (CCS) project at RGLNG.

Apart from this, NEXT will invest around $283 million in Phase 1, which comprises pre-FID capital investments of $125 million.

To finance the project, the company also closed senior secured bank credit facilities of $11.6 billion and senior secured private placement notes offering of $700 million.

Overall, the final engineering, procurement, and construction cost for Phase 1 is estimated at $12.0 billion.

"We look forward to delivering this important LNG project that will supply the world with reliable, and lower-carbon intensive LNG, while proudly supporting the Rio Grande Valley community by investing billions of dollars and creating thousands of much needed and well-deserved jobs. Now our focus turns to safely constructing Phase 1 on time and on budget and progressing commercial negotiations on RGLNG Train 4 and Train 5 to further expand our LNG platform and grow NextDecade shareholder value," said Matt Schatzman, Chairman and CEO.

Price Action: NEXT shares are trading higher by 1.30% at $8.59 premarket on the last check Thursday.