February 2, 2021 Read More →

NextDecade cancels plans for second Texas LNG export terminal

S&P Global Market Intelligence ($):

NextDecade Corp. abandoned plans Jan. 29 for a second LNG export terminal in Texas, stating the site it was considering was not suitable for development.

The decision regarding a potential terminal in Texas City, near Galveston, has no impact on ongoing development of the proposed Rio Grande LNG export facility in Brownsville, in South Texas, NextDecade said. The company had previously targeted a final investment decision for the up to 27 million tonnes-per-year Rio Grande LNG project in 2021. The timing has been delayed several times amid challenges securing sufficient long-term supply deals to support construction.

In 2018, NextDecade pitched a second terminal on Galveston Bay, south of Houston, along with a header pipeline. The project, at that time, officially entered the pre-filing review process at the Federal Energy Regulatory Commission.

The second terminal was proposed to be built on the Texas City Ship Channel at Shoal Point. As originally conceived, it would have entailed three LNG trains of 5.5 million mt/y each, four LNG storage tanks, two marine jetties and one turning basin. It also was to include a 42-inch-diameter, 97-mile header system pipeline from the Katy Hub to the LNG terminal or an alternative straight-line route of about 82 miles.

In a statement, NextDecade said that after completing its evaluation, it determined that the site is not suitable for development of an LNG facility and related infrastructure and utilities. It said the U.S. Army Corps of Engineers has advised that a portion of the Galveston Bay LNG site is under a special navigation designation that would require a request that Congress remove the designation.

As for the Rio Grande LNG project, NextDecade has continued to face challenges, largely on the commercial front. In November 2020, France’s Engie halted talks over a potential long-term supply agreement with NextDecade amid pressure not to import LNG produced from shale gas. On Jan. 14, officials said plans for a floating storage and regasification unit, or FSRU, at the Irish port of Cork will not go ahead after a preliminary deal signed in 2017 with NextDecade expired.

[Harry Weber]

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