NextDecade inks LNG deal with Guangdong Energy
US LNG developer NextDecade said March 24 it had entered into a binding heads of agreement (HoA) with Guangdong Energy Group Natural Gas for the long-term supply of LNG from its Rio Grande LNG project in Texas.
The HOA provides that Guangdong Energy will purchase up to 1.5mn mt/yr of LNG over a 20-year term indexed to Henry Hub, initially from the first train at Rio Grande, which is expected to begin commercial operations in 2026. NextDecade and Guangdong expect to complete a formal sales and purchase agreement (SPA) in Q2 2022.
The National Gas Company of Trinidad and Tobago Limited (NGC) NGC’s HSSE strategy is reflective and supportive of the organisational vision to become a leader in the global energy business.
Guangdong Energy is the second foundational customer of Rio Grande LNG and its first Chinese customer. In 2019, Shell inked a 20-year SPA for 2mn mt/yr, but in 2020, offtake negotiations with French Engie broke down over Rio Grande’s planned reliance on natural gas produced using hydraulic fracturing completion technologies.
Assuming additional offtake agreements and financing, NextDecade anticipates making a final investment decision on at least the first two trains of the planned five-train, 27mn mt/yr facility in the second half this year.