TotalEnergies Joins NextDecade in Developing Rio Grande LNG Plant in Texas

Posted on 14, June 2023 by | This entry was posted in Business, Energy, Gas & Oil, France, Industrial, Infrastructure & Utilities, Investment and tagged , , , , , , , , . Bookmark the permalink.

TotalEnergies Joins NextDecade in Developing Rio Grande LNG Plant in Texas

(IN BRIEF) TotalEnergies has signed a framework agreement with NextDecade to participate in the development of the Rio Grande LNG project in South Texas. As per the agreement, TotalEnergies will hold a 16.7% interest in the first phase of the project and offtake 5.4 million tons of LNG annually for twenty years. Additionally, TotalEnergies will acquire a 17.5% interest in NextDecade and have the option to participate in future project phases and a carbon capture and storage project. The first phase of the RGLNG project, developed by NextDecade and Global Infrastructure Partners, is expected to receive final investment approval soon and begin operations in 2027. The necessary authorizations have already been obtained from the US Federal Energy Regulatory Commission.

(PRESS RELEASE) PARIS, 14-Jun-2023 — /EuropaWire/ — TotalEnergies (EPA:TTE), a global multi-energy company with over 100,000 employees and presence in more than 130 countries as well as the world’s 3rd-largest low-carbon LNG company, announces that it has entered into a framework agreement with US-based NextDecade to collaborate on the development of the Rio Grande LNG (RGLNG) project, a liquefied natural gas (LNG) plant situated in South Texas. The agreement sets forth the following terms, subject to the execution of definitive documentation and final investment decision:

  1. TotalEnergies will hold a 16.7% interest in the first phase of the project, which encompasses three liquefaction trains with a combined annual capacity of 17.5 million tons per annum (Mtpa).
  2. TotalEnergies will commit to offtake 5.4 Mtpa of LNG from this initial phase for a period of twenty years, effectively increasing the company’s US LNG export capacity to over 15 Mtpa by 2030.
  3. TotalEnergies will acquire a 17.5% interest in NextDecade in three tranches, with a total value of $219 million. The first tranche, representing 5.06%, has already been acquired on June 13, 2023, for $40 million.
  4. TotalEnergies will have the opportunity to participate in future project phases and a carbon capture and storage project (CCS) planned by NextDecade to reduce emissions associated with the project.

NextDecade, as a shareholder and operator, alongside majority shareholder Global Infrastructure Partners (GIP), will spearhead the development of the first phase of RGLNG. The project, which has obtained all necessary authorizations from the US Federal Energy Regulatory Commission (FERC), is expected to reach a final investment decision in the coming weeks and commence operations in 2027.

The partnership between TotalEnergies and NextDecade represents a significant step forward in expanding LNG production and export capabilities. By leveraging its strategic interest in the Rio Grande LNG project, TotalEnergies aims to strengthen its position in the LNG market and contribute to the global energy transition.

“We are delighted to join forces with NextDecade and GIP on the development of this new US LNG project, for which TotalEnergies will leverage its extensive experience in LNG and technical expertise in major industrial project development,” said Patrick Pouyanné, Chairman and CEO of TotalEnergies. “Our involvement in this project will add 5.4 million tons per year of LNG to our global portfolio, strengthening our ability to ensure Europe’s security of gas supply, and to provide our Asian customers with an alternative fuel to coal that emits half its CO2 emissions.”

“This partnership with TotalEnergies and GIP marks a momentous milestone for NextDecade,” said Matt Schatzman, NextDecade Chairman and Chief Executive Officer. “We are excited to work with GIP and TotalEnergies on RGLNG and our proposed CCS project. We are also eager to grow our partnership with GIP and TotalEnergies, focusing on our shared vision to reduce carbon emissions in the energy sector.”

“With the world increasingly moving toward sustainable solutions, this partnership among GIP, TotalEnergies and NextDecade reinforces our shared commitment to helping lead the transition and shaping of the future of energy,” said Bayo Ogunlesi, Chairman and Chief Executive Officer of Global Infrastructure Partners. “This venture marks a critical step in displacing coal usage and upholds GIP’s commitment to promoting decarbonization, energy security and energy affordability. Our shared vision with TotalEnergies and NextDecade, combined with our capabilities, will undoubtedly help catalyze the development of cleaner energy.”

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TotalEnergies, the world’s third largest LNG player

TotalEnergies is the world’s third largest LNG player with a market share of around 12% and a global portfolio of about 50 Mt/y thanks to its interests in liquefaction plants in all geographies. The Company benefits from an integrated position across the LNG value chain, including production, transportation, access to more than 20 Mt/y of regasification capacity in Europe, trading, and LNG bunkering. TotalEnergies’ ambition is to increase the share of natural gas in its sales mix to close to 50% by 2030, to reduce carbon emissions and eliminate methane emissions associated with the gas value chain, and to work with local partners to promote the transition from coal to natural gas.

About TotalEnergies

TotalEnergies is a global multi-energy company that produces and markets energies: oil and biofuels, natural gas and green gases, renewables and electricity. Our more than 100,000 employees are committed to energy that is ever more affordable, cleaner, more reliable and accessible to as many people as possible. Active in nearly 130 countries, TotalEnergies puts sustainable development in all its dimensions at the heart of its projects and operations to contribute to the well-being of people.

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Cautionary Note
The terms “TotalEnergies”, “TotalEnergies company” or “Company” in this document are used to designate TotalEnergies SE and the consolidated entities that are directly or indirectly controlled by TotalEnergies SE. Likewise, the words “we”, “us” and “our” may also be used to refer to these entities or to their employees. The entities in which TotalEnergies SE directly or indirectly owns a shareholding are separate legal entities. TotalEnergies SE has no liability for the acts or omissions of these entities. This document may contain forward-looking information and statements that are based on a number of economic data and assumptions made in a given economic, competitive and regulatory environment. They may prove to be inaccurate in the future and are subject to a number of risk factors. Neither TotalEnergies SE nor any of its subsidiaries assumes any obligation to update publicly any forward-looking information or statement, objectives or trends contained in this document whether as a result of new information, future events or otherwise. Information concerning risk factors, that may affect TotalEnergies’ financial results or activities is provided in the most recent Registration Document, the French-language version of which is filed by TotalEnergies SE with the French securities regulator Autorité des Marchés Financiers (AMF), and in the Form 20-F filed with the United States Securities and Exchange Commission (SEC).

SOURCE: TotalEnergies

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