NextDecade adds funding for LNG facility
22 September 2023
Site will also offer carbon capture and storage
NextDecade Corp. said it has received $356 million in loans to finance a portion of the first three LNG trains (Phase 1) at its subsidiary NextDecade’s 27 million tonnes per annum (MTPA) Rio Grande LNG export facility in Brownsville, Texas.
The senior loans were disbursed in one advance for the full amount of $356 million, which resulted in a reduction in the commitments outstanding under RGLNG’s existing term loan facilities for Phase 1 from $11.1 billion to under $10.8 billion. These senior loans will mature in July 2033, will accrue interest at a fixed rate of 6.72%, and rank pari passu to RGLNG’s existing term loan facilities, the $500 million working capital facility, and the $700 million of 10-year senior notes issued at FID of Phase 1.
Rio Grande LNG is situated on a 984-acre site on the banks of an uncongested deepwater channel and will be the largest privately funded infrastructure project in Texas.
At full scale, Rio Grande LNG will deliver enough energy to heat and cool the equivalent of nearly 34 million U.S. households annually.
Rio Grande LNG is the first U.S. LNG project offering CO2 emissions reduction of more than 90% via planned carbon capture and storage – capturing and permanently storing more than 5 million metric tonnes of CO2 per year, the companies said.
This financing transaction aligns with NextDecade’s long-term balance sheet strategy for Phase 1, which includes extending and staggering debt maturities, diversifying sources of capital, reducing bank capital over time to provide potential capacity for financing future LNG expansions, and mitigating interest rate exposure. As of the date hereof, RGLNG’s outstanding fixed-rate debt and executed interest rate swaps have reduced its exposure to movement in interest rates for over 80% of the debt currently projected to be incurred in support of Phase 1 construction.
NextDecade Corp., through its wholly owned subsidiaries Rio Grande LNG and NEXT Carbon Solutions, is developing a 27 MTPA LNG export facility in South Texas along with one of the largest carbon capture and storage projects in North America. The companies are also working with third-party customers around the world to deploy proprietary processes to lower the cost of carbon capture and storage and reduce CO2 emissions at their industrial-scale facilities.