Back to the news list

Saudi Aramco to buy LNG from U.S. Rio Grande Project

Source

Saudi Aramco expects to buy liquefied natural gas from NextDecade Corporation’s planned train 4 at the Rio Grande LNG export facility in Texas under a 20-year agreement, the companies said on June 13.

Illustrative image

The Saudi state oil giant and the U.S. LNG developer signed a non-binding Heads of Agreement (HoA) for a 20-year LNG offtake deal, under which Aramco expects to purchase 1.2 million tonnes per annum (MTPA) of LNG for 20 years on a free on board basis, at a price indexed to the U.S. benchmark, Henry Hub.

Aramco and NextDecade are currently in the process of negotiating a binding agreement, the effectiveness of which will be subject to a positive Final Investment Decision on Train 4.

NextDecade targets to take the FID of Train 4 in the second half of 2024, subject to finalizing and entering into an engineering, procurement and construction (EPC) contract, gaining appropriate commercial support, and obtaining adequate financing to construct Train 4 and related infrastructure.

Earlier this month, reports emerged that Saudi Aramco is in discussions with U.S. LNG developers to buy a stake in one planned project and sign a long-term LNG offtake deal from another proposed export facility, namely Train 4 at Rio Grande LNG. Aramco is in talks with U.S. company Tellurian to buy a stake in its Driftwood LNG export facility near Lake Charles, Louisiana, Reuters reported last week, citing sources close to the talks.

Aramco, the world’s top crude exporter and the world’s biggest oil firm, has been seeking a greater role on the global LNG market as it plans to ramp up its natural gas production and trading business.

Last autumn, Saudi Aramco entered the global LNG business by signing a deal to buy a minority stake in LNG company MidOcean Energy, which was in the process of acquiring interests in four Australian LNG projects.

Going into LNG trading would be another lucrative business for the Saudi oil giant, considering that LNG demand is only set to grow in the coming years as Europe ditches Russian gas and Asia looks to use more natural gas instead of coal.

Is this article helpful to you?
Share it now with your partners or friends

Featured content

Không thể sao chép