NextDecade postpones Rio Grande LNG project FID to next year

US-based liquefied natural gas (LNG) development company NextDecade has pushed back a final investment decision (FID) by at least a year on its proposed Rio Grande LNG export plant.

The Rio Grande liquefied natural gas (RGLNG) export facility is located in Brownsville, Texas, US.

Last week, the company reportedly said that it still plans to make a FID this year on the Rio Grande LNG export plant.

Citing the coronavirus outbreak lowering demand and prices for LNG, NextDecade has now postponed making a FID on the project until next year.

The company has announced the delay along with its first-quarter (Q1 2020) earnings.

NextDecade also noted that it took several steps to preserve liquidity, including an 18% decrease in full-time headcount, furloughing 14% of staff and issuing a voluntary reduction of 10% in pay for its CEO and other members of the executive team until this year-end.

NextDecade chairman and CEO Matt Schatzman said: “Our balance sheet is strong, we have no debt outstanding, and the long-term fundamentals for our Rio Grande LNG project remain firmly intact.

“This solid foundation, together with our sustained regulatory, engineering and commercial progress, positions the company and our Rio Grande LNG project extremely well for when global market conditions improve.”

NextDecade expects to start commercial operations of the LNG plant in 2023.

The project will comprise three liquefaction trains, two 180,000m³ storage tanks, and two marine berths.

In February this year, NextDecade and energy transportation firm Enbridge signed an agreement to jointly develop the Rio Bravo Pipeline in Texas.

In May last year, NextDecade awarded an engineering, procurement, and construction (EPC) contract valued at over $9.5bn to Bechtel for the first phase of the Rio Grande LNG project.