China’s ENN has agreed to buy 1.5 million mt/year of LNG from NextDecade’s proposed Rio Grande LNG export terminal in Texas, the companies said April 6, reports SP Global.
About the project
NextDecade is building momentum for its project after a recent preliminary agreement with a Chinese utility, Guangdong Energy, and a 2019 firm offtake agreement with Shell. The three transactions combine for 5 million mt/year, out of the project’s first phase that is expected to account for around 11 million mt/year of capacity.
In 2021 and during the first several months of 2022, there has been a flurry of commercial activity tied to current and proposed US LNG export terminals. Other beneficiaries have been Cheniere Energy and Venture Global LNG.
Chinese buyers
Chinese buyers have been especially active, as high spot prices in end-user markets have spurred new term deals that carry a lower fixed price.
Two proposed US projects were scrapped in 2021 — Pembina’s Jordan Cove in Oregon and Exelon-backed Annova LNG, which was to be built in Brownsville, near NextDecade’s proposed site.
Under NextDecade’s deal with ENN LNG (Singapore) Pte, a subsidiary of ENN Natural Gas Co., the LNG supply will be sourced from the first two trains at Rio Grande LNG.
NextDecade expects the first train to start commercial operations as early as 2026, pending a final investment decision targeted for the second half of this year.
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Source: SP Global
