China Gas inks 20-year LNG deal with NextDecade
China Gas Holdings on July 5 announced that its wholly-owned subsidiary China Gas Hongda Energy Trading Co. and Rio Grande LNG, a subsidiary of NextDecade Corp, have signed a 20-year LNG sale and purchase agreement.
According to the agreement, NextDecade will supply 1mn metric tons/year of LNG to China Gas on a free-on-board basis. The purchase price is indexed to the benchmark price of Henry Hub. The first batch of LNG is expected to be delivered in 2027, China Gas said.
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The LNG will come from the first two trains at the Rio Grande project, expected to start operations as early as 2026. NextDecade expects to take a final investment decision on at least two trains of the five-train, 27mn mt/yr project in the second half of this year.
This is NextDecade’s third LNG supply deal with a Chinese buyer. It signed an agreement with ENN in April and with state-owned utility Guangdong Energy in March.