U.S. LNG project developer NextDecade and Chinese utility Guangdong Energy have executed a 20-year sale and purchase agreement (SPA) for the supply of LNG from NextDecade’s Rio Grande LNG export project.
On 6 July, NextDecade announced the execution of a 20-year SPA with Guangdong Energy for the supply of LNG from NextDecade’s Rio Grande project in Brownsville, Texas. The SPA was completed pursuant to the binding heads of agreement from March 2022.
Under the SPA, Guangdong will purchase approximately 1.0 million tonnes per annum (mtpa) of LNG indexed to Henry Hub and delivered on an ex-ship (DES) basis.
The LNG will come from Rio Grande LNG Train 1, which is to start commercial operations as early as 2026.
Moreover, Guangdong has the right to purchase an additional 0.5 mtpa of LNG from Rio Grande.
NextDecade anticipates making a positive final investment decision (FID) on up to three trains of the Rio Grande export project in the second half of 2022. FIDs of its remaining trains are to follow thereafter. This is based on the current expected demand for LNG.