NextDecade said on Monday that units of both firms have executed a long-term LNG sale and purchase agreement (SPA) for offtake from Train 4.
Under the terms of the SPA, TotalEnergies Gas & Power North America will buy 1.5 million tonnes per annum (mtpa) of LNG for 20 years on a free-on-board basis at a price indexed to Henry Hub.
NextDecade said the SPA remains subject to a positive final investment decision (FID) on Train 4.
“TotalEnergies has been a key contributor to the success of Rio Grande LNG Phase 1, and we are pleased to be expanding our strategic partnership with TotalEnergies with the execution of this Train 4 SPA,” said Matt Schatzman, NextDecade’s chairman and CEO.
“This SPA completes the commercial support we need for Rio Grande LNG Train 4, and we are now focused on progressing Train 4 toward a positive FID,” he said.
NextDecade has contracted a total of 4.6 mtpa of LNG from Train 4 on a long-term basis.
The firm recently also signed a 20-year SPA with Saudi Arabia’s energy behemoth Aramco.
Achieving a positive FID on Train 4 will be subject to, among other things, obtaining adequate financing to construct Train 4 and related infrastructure, NextDecade said.
Rio Grande LNG expansion
NextDecade is currently building three trains at the site located on the north shore of the Brownsville Ship Channel in south Texas.
In July 2023, NextDecade took the final investment decision on the first three Rio Grande trains and completed a $18.4 billion project financing.
The firm also closed a joint venture agreement for the first phase, which included about $5.9 billion of financial commitments from Global Infrastructure Partners (GIP), GIC, Mubadala, and TotalEnergies.
The deal also included options for the fourth and fifth trains.
NextDecade holds equity interests in the Phase 1 joint venture that entitle it to receive up to 20.8 percent of the distributions of available cash during operations.
Phase 1, with nameplate liquefaction capacity of 17.6 mtpa, has 16.2 mtpa of long-term binding LNG sale and purchase agreements.
These include deals with TotalEnergies, Shell, ENN, Engie, ExxonMobil, Guangdong Energy Group, China Gas Hongda Energy Trading, Galp, and also Itochu.
Moreover, NextDecade awarded the $12 billion EPC contract to Bechtel, and it officially kicked off work on the plant in October 2023.
The company recently said it is also making “excellent” progress on commercializing Rio Grande LNG trains 4 and 5.
In addition, NextDecade announced plans to build up to five more trains at the Rio Grande LNG facility.
NextDecade said it is developing and beginning the permitting process for trains 6 through 8, which are wholly owned by NextDecade and are cumulatively expected to increase the company’s total liquefaction capacity by approximately 18 million tonnes per annum once constructed and placed into operation.
