EQT has sealed a purchase deal for 1.5 million tons of liquefied natural gas from NextDecade’s Rio Grande facility, for a period of 20 years. The deal is part of the gas major’s diversification drive within the natural gas space.
“Our growing LNG exposure, combined with the unique attributes that have made EQT the supplier of choice for end users of natural gas domestically – our low-cost structure, unmatched scale and resource depth, investment grade balance sheet, and peer leading emissions profile – position the company to expand its market reach and become the supplier of choice for end users of natural gas worldwide,” EQT chief executive Toby Rice said in comments on the deal.
This expansion could intensify competition in the LNG space, possibly affecting prices in a way favorable for end consumers.
The EQT deal follows another 20-year purchase commitment from Saudi Aramco, inked earlier in the year, as NextDecade seeks clients for the gas it will be liquefying at the Brownsville, Texas, facility.
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.
The company has also been taking on partners. In May this year, Abu Dhabi’s Adnoc took a 12% stake in the project and made a 20-year offtake agreement with NextDecade. In August, NextDecade said it had secured a funding tranche of $3 billion for the Rio Grande LNG facility, of which half would come from French TotalEnergies and Global Infrastructure Partners.
The company advertises its liquefaction plant as the first such facility in the United States to feature a carbon capture and storage system that would ensure emission reductions of up to 90%.
By Irina Slav for Oilprice.com
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