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HomeFundingUAE-Based ADNOC Acquires Stake in NextDecade’s Rio Grande LNG Project

UAE-Based ADNOC Acquires Stake in NextDecade’s Rio Grande LNG Project

Abu Dhabi National Oil Company (ADNOC) bought 11.7% of NextDecade's Rio Grande LNG export facility in Texas and signed a 20-year supply deal for the fourth liquefaction train, pending final investment approval.

Abu Dhabi National Oil Company (ADNOC) bought 11.7% of NextDecade’s Rio Grande LNG export facility in Texas and signed a 20-year supply deal for the fourth liquefaction train, pending final investment approval.

ADNOC sees gas and LNG as essential development pillars along with renewable energy and petrochemicals, aiming to increase its LNG capacity from 6 to 15 mtpa by 2028. Multiple delays have plagued the $18 billion Rio Grande LNG project, which has five 5.4-mtpa liquefaction trains and is projected to finish phase 1 by early 2029.

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Abu Dhabi National Oil Company (ADNOC) made its first major US investment by buying 11.7% of NextDecade’s Rio Grande LNG export project in Texas and signing a supply deal.

ADNOC bought a stake in phase 1, which includes the first three liquefaction trains, and committed to a 20-year supply deal for the fourth train awaiting a final investment decision. ADNOC considers gas and LNG, renewable energy, and petrochemicals important to its expansion and plans to increase its capacity from 6 to 15 million metric tonnes per year (mtpa) by 2028.

ADNOC and Saudi Aramco are exploring potential in the US, the world’s largest LNG exporter, which supplies record volumes to Europe. Global LNG consumption is forecast to climb by 50% by 2030.

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ADNOC executive director for low carbon solutions and international growth Musabbeh Al Kaabi said the transaction “marks a significant milestone in ADNOC’s international growth strategy and provides us access to one of the world’s top LNG export markets.”

Demand from supply problems and sanctions associated to Russia’s war in Ukraine made the US the world’s top LNG supplier in 2023, surpassing Australia and Qatar.

After the FID, NextDecade will build the fourth liquefaction train in the second half of 2024. After multiple delays, the Rio Grande LNG export plant is expected to finish phase 1 by early 2029 for $18 billion. The project has five 5.4-mtpa liquefaction trains that can process 3.6 billion cubic feet of natural gas daily.

About ADNOC

ADNOC is a significant diversified energy group owned by Abu Dhabi.

About Rio Grande

Rio Grande LNG, situated on a 984-acre site near Brownsville, Texas, is the first US LNG project offering expected emissions reduction of more than 90% through its innovative proposed carbon capture and storage (CCS) project, which is expected to capture and permanently store more than 5 million metric tons per annum of carbon dioxide (CO2) – equivalent to removing 1 million vehicles from the road annually.

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