NextDecade Signs Lump-Sum Turnkey EPC Contracts with Bechtel for ~ $543 Per Ton
May 28 2019 - 8:00AM
Business Wire
NextDecade Corporation (NextDecade) (NASDAQ: NEXT) announced
today that it has signed two contracts with Bechtel Oil, Gas and
Chemicals (Bechtel) for the engineering, procurement, and
construction (EPC) of NextDecade’s Rio Grande LNG project in
Brownsville, Texas. The fully wrapped lump-sum turnkey (LSTK) EPC
contracts include cost, schedule, and performance guarantees.
The EPC contracts are for the first phase of the Rio Grande LNG
project, which consists of three liquefaction trains, two 180,000
cubic meter storage tanks and two marine berths totaling $9.565
billion. Each liquefaction train is expected to have capacity up to
5.87 million tons per annum of LNG, which would generate an EPC
cost of approximately $543 per ton for the first three trains.
“We are pleased to be working with Bechtel, who is responsible
for constructing about 30 percent of the world’s LNG capacity,”
said Matt Schatzman, NextDecade’s President and Chief Executive
Officer. “Bechtel’s extensive experience developing LNG projects on
the U.S. Gulf Coast, along with our advantaged site and technology
choices, including Air Products C3MR and Baker Hughes GE rotating
equipment, is expected to enable NextDecade – in just the first
three trains – to have the lowest cost per ton greenfield LNG
project built on the U.S. Gulf Coast under a fully wrapped lump-sum
turnkey EPC contract.”
“Throughout our competitive EPC process, Bechtel has
demonstrated a steadfast commitment to safety, reliability, and
efficiency,” said Ivan Van der Walt, NextDecade’s Senior Vice
President of Engineering and Construction. “Bechtel’s track record
building LNG projects on the U.S. Gulf Coast is unrivaled. Our
global LNG customers, feed gas suppliers, and other stakeholders
can have the utmost confidence in the on-time and on-budget
delivery of our Rio Grande LNG project.”
The EPC contracts include full site preparation activities,
which are expected to further reduce the costs per ton of the
remaining trains to below the first phase cost of $543 per ton. In
addition, the EPC contracts provide NextDecade the ability to have
Bechtel commence construction of the first phase of Rio Grande LNG
with either two or three trains. Bechtel will perform limited
notice to proceed activities from June 1, 2019 until January 1,
2020 and has agreed to accept up to $15 million in NextDecade
common stock in consideration for certain activities.
“We are honored to be selected by NextDecade to deliver their
facility using our fully integrated engineering, procurement and
direct-hire construction model,” said Alasdair Cathcart, President
of Oil, Gas and Chemicals for Bechtel. “Bechtel has a proud history
of successfully developing lump-sum turnkey LNG projects around the
world, having delivered 14 large-scale LNG Trains in just the last
four years.”
Pending the achievement of further commercial milestones and
receipt of final regulatory approvals, NextDecade anticipates
making a positive final investment decision on up to three trains
of the Rio Grande LNG project as early as the end of the third
quarter of 2019 and commencing operations in 2023.
About NextDecade Corporation
NextDecade is a liquified natural gas (LNG) development company
focused on LNG export projects and associated pipelines in Texas.
NextDecade intends to develop the largest LNG export solution
linking Permian Basin associated gas to the global LNG market,
creating value for producers, customers, and stockholders. Its
portfolio of LNG projects includes the 27 mtpa Rio Grande LNG
export facility in Brownsville, Texas and the 4.5 Bcf/d Rio Bravo
Pipeline that would transport natural gas from the Agua Dulce area
to Rio Grande LNG. NextDecade’s common stock is listed on the
Nasdaq Stock Market under the symbol “NEXT.” NextDecade is
headquartered in Houston, Texas. For more information, visit
www.next-decade.com.
CAUTIONARY INFORMATION ABOUT FORWARD-LOOKING
STATEMENTS
This press release contains forward-looking statements within
the meaning of U.S. federal securities laws. The words
“anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,”
“might,” “plan,” “potential,” “project,” “should,” “will” and
similar expressions are intended to identify forward-looking
statements, and these statements may relate to the business of
NextDecade and its subsidiaries. These statements have been based
on NextDecade’s current assumptions, expectations, and projections
about future events and involve a number of known and unknown
risks, which may cause actual results to differ materially from
expectations expressed or implied in the forward-looking
statements. These risks include uncertainties about NextDecade’s
Rio Grande LNG and Rio Bravo Pipeline projects; its ability to
secure additional debt and equity financing in the future to
complete its contemplated projects; the accuracy of the estimated
costs for the projects; governmental approval of construction and
operation of the projects; the successful completion of the
projects by third-party contractors; its ability to generate cash;
the development risks, operational hazards, regulatory approvals
applicable to the projects’ construction and operations activities;
its anticipated competitive advantage; the global demand for and
price of natural gas (versus the price of imported LNG); the
availability of LNG vessels worldwide; legislation and regulations
relating to the LNG industry; negotiations for the project site
lease and right-of-way options for the pipeline route; compliance
with environmental laws and regulations; the result of future
financing efforts and applications for customary tax incentives;
and other matters discussed in the “Risk Factors” section of
NextDecade’s Annual Report on Form 10-K for the year ended December
31, 2018 and other subsequent reports filed with the Securities and
Exchange Commission, all of which are incorporated herein by
reference.
Additionally, any development of the projects remains contingent
upon completing required commercial agreements; acquiring all
necessary permits and approvals; securing all financing commitments
and potential tax incentives; achieving other customary conditions;
and making a final investment decision to proceed. The
forward-looking statements in this press release speak as of the
date of this release. Although NextDecade believes that the
expectations reflected in these forward-looking statements are
reasonable, it can give no assurance that the expectations will
prove to be correct. NextDecade may from time to time voluntarily
update its prior forward-looking statements, however, it disclaims
any commitment to do so except as required by securities laws.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190528005165/en/
Investors: ir@next-decade.com | + 1 (832) 910
8629Media: communications@next-decade.com | + 1 (281) 249
5453
NextDecade (NASDAQ:NEXT)
Historical Stock Chart
From Mar 2024 to Apr 2024
NextDecade (NASDAQ:NEXT)
Historical Stock Chart
From Apr 2023 to Apr 2024