NextDecade Expands LNG Supply With China’s ENN Contract

The united states liquified natural gas maker NextDecade has signed a new purchase agreement to increase the sale volume of LNG supplies with china’s ENN Natural Gas corporation.

Under the fresh agreement, NextDecade will sell two million metric tons of Liquified Nitrogen Gas per year to china’s ENN. In the previous agreement, ENN used to purchase one million metric tons of LNG per year. In the new agreement, the supply is further increased by 0.5 million metric tonnes.

All the supply volumes of the gas are expected to come by the first three trains at NextDecade’s Rio Grande LNG export project in Brownsville, texas. It is supplied on a free-on-board basis and will be further indexed to the Henry hub.

NextDecade Promises To Create The World’s Greenest LNG

Earlier, The U.S. Gas company further postponed its Final investment decision on its project. The initial plan for the project is to start producing and supplying LNG in 2023, with capable of using zero electricity. The NextDecade has assured its investors and the public to produce the greenest LNG in the world.

As per the new agreement, the NextDecade has declared on targeting a final investment decision on the first three trains of the project in the first quarter of 2023, and the remaining FIDs will be followed. The NextDecade were lingering for a push on their FID as demand from Europe is still to replace Russian gas for the next few years.

This year, NextDecade has further bagged several LNG sales and purchase agreements for its Rio Grande Project including ExxonMobil, Guangdong Energy, and China gas.

Including these companies on the list would require the company to reach an additional Final investment decision.

Recently, Next decade bagged another deal of purchase agreement with a Portuguese energy company named Galp for 1 million metric tonnes per year for 20 years.

In the earlier settlement back in April, the volume of the supply was the same. Due to the delay of the final investment decision, they targeted to start their first set of train operations in early 2026.

The pipeline company did not add the purchase price as it is indexed to the Henry hub with an additional liquefaction charge. It is believed that gas companies have now been surging their rates as sanctions on Russian fuel have tightened the supply furthermore.

In the early quarter of 2022, apart from NextDecade, 13 proposed liquefaction projects have received the department of energy and federal energy regulatory commission approval, yet they have not reached any final investment decision.

According to the reports submitted by the Bank of America, the top proposals that are likely to get financial approvals this year are Loiusana-based Venture Global’s Plaquemines and Tellurian Inc Driftwood plant and Cheniere Energy Inc. corpus Christi stage 3 project in texas.

More: China’s Central Bank Makes Its Largest Weekly Cash Injection In Two Months

In the previous year, china became the top importer of LNG. They shipped 78.8 million tonnes of chilled fuel in 2021. According to china’s costumes data, 11% out of the 78.8 million tonnes were imported from the United States.

To supply more sustainable LNG to different parts of the world, NextDecade is partnered with NEXT carbon solutions for carbon capture and storage development. The Rio Grande LNG project is will be able to capture more than 90% of the emissions associated with natural gas and liquefaction. 

 Experts believe that the stocks of NextDecade corp will rise up by 43.90% over the coming twelve months as it is all set to start its production and supply chain. As of December 28, the price of the NEXT is closed at 4.94 with a 4.88% rise.