Abu Dhabi National Oil Co. (Adnoc) has invested in the first phase of Rio Grande LNG and secured offtake from a future expansion as it looks to boost its international natural gas portfolio.
Adnoc disclosed Monday it has acquired an 11.7% stake in the first three trains of NextDecade Corp.’s 17.6 million metric tons/year (mmty) export terminal currently under construction in South Texas. It also signed a 20-year liquefied natural gas supply agreement for 1.9 mmty from the proposed Train 4 project on a free-on-board basis indexed to Henry Hub.
“As global energy demand continues to increase, Adnoc is growing our diversified energy portfolio to ensure a secure, reliable and responsible supply of energy to our customers while driving innovation and greater value,” Adnoc’s Musabbeh Al Kaabi, executive director for low carbon solutions and international growth, said.
Adnoc secured its stake from Global Infrastructure Partners (GIP), which along with TotalEnergies SE and other joint venture equity partners, backed the first phase of Rio Grande LNG with a combined $5.9 billion in financial commitments.
As a part of its agreement with GIP, Adnoc also has the option of taking equity in Train 4 and Train 5 if the partners and NextDecade progress the projects to a final investment decision (FID).
NextDecade has shifted a possible FID on Train 4 from the first six months of 2024 to sometime in the second half of the year. The Houston-based firm and its partners also are finalizing an engineering, procurement and construction contract with Bechtel Corp.
NextDecade has estimated it could have at least 3 mmty in combined offtake covered from Trains 4 and 5 if TotalEnergies chooses to pull the trigger on its equity options.
Adnoc, which launched an initial public offering for its gas and LNG business earlier last year, plans to spend $150 billion through 2027 to boost oil and gas production capacity. It has also been looking for opportunities to grow its footprint in the global LNG market.
The nationalized company issued a limited notice to proceed in March for work on its Ruwais LNG export project. The project would consist of two 4.8 mmty liquefaction trains that would more than double Adnoc’s LNG production capacity to about 15 mmty.
BP plc and Adnoc also formed a joint venture earlier this year to focus on Egyptian natural gas production.
