Update On Another LNG Export Terminal -- September 27, 2022

RBN Energy: NextDecade eyes FID on Rio Grande LNG project with carbon capture, part 4. Archived.

The world needs more LNG and the U.S. is answering that call. Two U.S. liquefaction projects, Venture Global’s Plaquemines LNG and Cheniere’s Corpus Christi Stage III, have already reached a final investment decision (FID) on a combined 23.3 MMtpa (3.1 Bcf/d) of export capacity, which will be online by mid-decade. But by the looks of it, we are just getting started. Next up could be NextDecade’s Rio Grande LNG, which has sold 75% of its first two trains’ capacity — enough to take FID, possibly by the end of the year. If it moves forward, not only will the project add another 10.8 MMtpa (1.43 Bcf/d) or more of export capacity to the Gulf Coast, it could also come with a new carbon capture and sequestration (CCS) facility, which has long been a selling point for the project. In today’s RBN blog, we continue our series on the U.S. LNG projects most likely to move forward, this time with a look at Rio Grande LNG.

From August 28, 2022:

Link here.

Most important data point is at this link. See if you can spot it.

See LNG_Export_US_List.

From RBN Energy today:

Part 1: Venture Global’s Plaquemines LNG, which became the first U.S. project to take FID in the post-COVID wave of LNG expansion;

Part 2: Cheniere’s Corpus Christi Stage III, whose developer has also since committed to its construction. Both projects are now being built and targeting startups in the 2024-25 timeframe. Beyond that, however, both have continued to sell capacity and are likely to see additional trains take FID before construction is complete. 

Venture Global so far has taken FID on 13.3 MMtpa (1.8 Bcf/d) of export capacity, but the full project is 20 MMtpa and total capacity is nearly 90% sold out. Cheniere sold 2.8 MMtpa (0.4 Bcf/d) of capacity from an unnamed expansion at Corpus Christi this summer, which it later said would come from two additional mini-trains at Stage III totaling 3.3 MMtpa (0.44 Bcf/d). The project has just started its FERC application process and is already nearly sold out.

Part 3: Driftwood LNG, Tellurian’s 11-MMtpa project, which began construction in Louisiana earlier this year but was finding it extremely difficult to secure financing. The project was underpinned by three 10-year deals with no liquefaction fee, which was in part why Tellurian has found financing so challenging, and now two of those deals have been scrapped. Shell pulled out of its agreement with Tellurian last week at the same time Tellurian said it was cancelling its contract with Vitol. This leaves only the 3-MMtpa, 10-year contract with Gunvor intact and means the project’s future is murkier than ever. 

Part 4, today: While Plaquemines and Corpus Christi were in the spotlight, other projects continued to progress ... that look poised for a near-term FID, with NextDecade’s Rio Grande LNG now at the top of the list. 

Rio Grande LNG is a five-train, 27-MMtpa (3.6 Bcf/d) LNG terminal proposed for the Port of Brownsville in Texas. The company will likely take FID on two or three trains first, with commitments on the others to follow once construction has begun. The project has secured 8.25 MMtpa (1.1 Bcf/d) of its capacity in binding, long-term sales purchase agreements (SPAs), which is equal to 75% of the first two trains. The project first sold 2 MMtpa (0.26 Bcf/d) to Shell back in 2019 and at the time was also in negotiations with French utility Engie for additional volumes. Engie backed out of the deal in November 2020 but later restarted negotiations and signed a 1.75-MMtpa (0.23 Bcf/d) SPA this spring. The project has also secured 3.5 MMtpa (0.46 Bcf/d) of SPAs with Chinese offtakers and 1 MMtpa (0.13 Bcf/d) with ExxonMobil.