TotalEnergies SE and its partners have made the final investment decision to develop the first phase of the Rio Grande LNG natural gas liquefaction project in South Texas, the company said in a press release.
The first phase of the Rio Grande LNG project includes three liquefaction trains with a total capacity of 17.5 million tonnes per annum (mtpa) and a capital expenditure of $14.8 billion, according to the press release. Commissioning of the plant is scheduled for 2027 and TotalEnergies will take 5.4 Mtpa of LNG from the production of this phase over 20 years.
The French energy company is partnering with Global Infrastructure Partners, NextDecade, GIC and Mubadala for the project. The project will be financed by equity contributions from partners and a debt contribution from an undisclosed “consortium of international banks,” according to the statement. Bechtel has been awarded the engineering, procurement and construction contract.
TotalEnergies will acquire a 16.67% stake in the joint venture in charge of the first phase of the project and will allocate $1.1 billion in capital contributions. The company will also hold a 17.5 percent stake in NextDecade for a total of $219 million. TotalEnergies acquired the first tranche of 5.06 percent in June and plans to increase the stake to 12.47 percent “in the coming days,” according to the statement. It will acquire the third tranche of 5.03 percent before the end of 2023.
“We are delighted with this final investment decision that allows us to start the construction of this new LNG liquefaction plant in the United States, to which TotalEnergies will bring its experience in the development of large LNG projects,” he said Patrick Pouyanne, president and CEO of TotalEnergies. . “This project gives TotalEnergies access to competitive LNG thanks to its low production costs. The LNG from this first phase will increase TotalEnergies’ US LNG export capacity to more than 15 mtpa by 2030 and thus our ability to contribute to European gas security and provide customers with Asia a form of alternative energy that is half as emissive as coal. “
“Working together with TotalEnergies, we will be able to fulfill our mission of delivering low-carbon LNG to customers around the world, and we look forward to working together as Rio Grande LNG Phase 1 construction begins,” Matt, President and CEO of NextDecade. Schatzman said.
According to the company’s website, TotalEnergies is the world’s third-largest LNG player with a market share of around 12 percent and a global portfolio of around 50 million tonnes per year. It aims to increase the share of natural gas in its sales mix to nearly 50 percent by 2030.
In a separate press release, TotalEnergies said it started production at the first phase of Azerbaijan’s Absheron gas and condensate field in the Caspian Sea. The company is partnering with the State Oil Company of the Republic of Azerbaijan (SOCAR) for the project.
The first phase connects a subsea production well to a new gas processing platform, which is linked to SOCAR’s existing facilities at Oil Rocks. It has a production capacity of 141.3 million cubic feet (4.0 million cubic meters of gas) per day and 12,000 barrels per day of condensate. The gas will be sold on the domestic market in Azerbaijan, according to the statement.
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