NextDecade, the company building the Rio Grande LNG plant, has secured funding of a total $3 billion for the expansion of its project, with over half of the money coming from TotalEnergies and Global Infrastructure Partners, NextDecade reported in a Securities and Exchange Commission filing.
The French supermajor will contribute $300 million of the total in exchange for a 10% stake in the fourth liquefaction train of the Rio Grande facility, while the private equity major will pay $1.5 billion for a 50% stake in the same train. NextDecade will contribute $1.4 billion to the expansion project, retaining 40% of the train.
The agreement with Global Infrastructure Partners includes a stipulation that should train 4 of the Rio Grande facility reach certain milestones related to return on investment, the stake of NextDecade in it would automatically increase to 60% while the stake of Global Infrastructure Partners would drop to 30%.
NextDecade said last year it expected total estimated project costs at between $6 billion and $6.2 billion for Train 4 and related infrastructure, in line with the per-train cost of the three-train Phase 1 at the Rio Grande LNG facility, which is currently under construction.
In May this year, Abu Dhabi’s ADNOC announced the acquisition of a 12% stake in Rio Grande LNG, complete with a 20-year offtake agreement with NextDecade. The gas for the offtake agreement will come from the fourth train of the facility.
Rio Grande LNG near Brownsville, Texas, is the first U.S. LNG project offering expected emissions reduction of more than 90% through its proposed carbon capture and storage project, ADNOC noted.
The CCS project is expected to capture and permanently store more than 5 million metric tons per annum of carbon dioxide – equivalent to removing 1 million vehicles from the road annually, according to the company.
By Irina Slav for Oilprice.com
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