The United Arab Emirates’ state-run oil and gas company ADNOC announced on September 25 that its investment vehicle XRG has closed its acquisition of an equity stake in NextDecade’s Rio Grande LNG project located in Brownsville, Texas.
The deal was originally agreed to in May 2024. With the acquisition now officially closed, XRG has become an 11.7% stake owner of Phase 1 of the Rio Grande LNG project, purchasing the stake from Global Infrastructure Partner (GIP), which is a part of US investment management firm BlackRock. GIP continues to hold a stake in the project.
Phase 1 of the project includes liquefaction trains 1 to 3, which are currently under construction and expected to be finished in 2029. NextDecade announced in September that it has taken a final investment decision (FID) on Train 4.
Also in September, NextDecade announced a 20-year offtake agreement with ConocoPhillips for 1mn tonnes per year (tpy) of LNG sold on a free on board (FOB) basis at a price indexed to Henry Hub from the facility’s Train 5.
NextDecade is expected to take FID by mid-November on the project’s liquefaction Train 5. ADNOC maintains the option of buying equity from GIP in Rio Grande’s trains 4 and 5. It also has an offtake agreement for 1.9mn tpy from Train 4.
The Rio Grande LNG project could potentially be expanded to as many as ten liquefaction trains, which would give it a nameplate capacity of about 48mn tpy, which would make it one of the largest LNG plants in the world.
ADNOC’s acquisition of the interest is part of the Gulf company’s attempt to expand its global footprint and become a larger player in the global LNG market. The UAE company is seeking to increase its LNG capacity to 15mn tpy by 2028.
