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HOUSTON - NextDecade Corporation (NASDAQ:NEXT), whose stock has surged over 110% in the past year according to InvestingPro data, announced Tuesday it has made a positive final investment decision (FID) on Train 4 at its Rio Grande LNG facility and issued full notice to proceed to Bechtel Energy Inc. for construction.
The company has closed financial transactions totaling approximately $6.7 billion to fully fund Train 4 and related infrastructure. The financing includes a $3.85 billion term loan facility, $1.13 billion in equity commitments from NextDecade, and $1.7 billion from investment partners including Global Infrastructure Partners, GIC, Mubadala Investment Company, and TotalEnergies. InvestingPro data shows NextDecade operates with a significant debt burden, with total debt reaching $5.3 billion and a debt-to-equity ratio of 20.4x.
Train 4 has an expected LNG production capacity of approximately 6 million tonnes per annum (MTPA), bringing the total expected capacity under construction at Rio Grande LNG to approximately 24 MTPA. The project is commercially supported by 4.6 MTPA of 20-year LNG Sale and Purchase Agreements with ADNOC, TotalEnergies, and Aramco.
NextDecade funded its equity commitment through $1.33 billion in term loans without impacting its common shares outstanding. The company will maintain an initial 40% economic interest in Train 4, which will increase to 60% after financial investors achieve certain returns.
"The global call for additional natural gas infrastructure continues to be strong, and we are well positioned to meet this growing demand for cleaner energy," said Matt Schatzman, NextDecade’s Chairman and Chief Executive Officer, in the press release. While the company’s market capitalization stands at $2.62 billion, InvestingPro analysis indicates the stock may be slightly overvalued at current levels. Subscribers can access 13 additional ProTips and comprehensive financial metrics to better evaluate NextDecade’s investment potential.
The guaranteed substantial completion date for Train 4 is anticipated in the second half of 2030.
NextDecade also stated it expects to make a positive FID on Train 5 in the fourth quarter of 2025. Train 5 is commercially supported by 4.5 MTPA of 20-year LNG SPAs with JERA, EQT Corporation, and ConocoPhillips. The company has extended the pricing validity period under the Train 5 EPC contract through November 15, 2025.
In other recent news, NextDecade Corporation announced the resignation of Mr. Timothy Wyatt from its Board of Directors. The departure was detailed in an SEC filing, and Mr. Wyatt clarified that his resignation was not due to any disagreements with the company. Instead, it was related to his decision to leave his employment with the Hanwha Group to pursue other opportunities. Mr. Wyatt had been appointed to the Board in January 2024 under the Purchaser Rights Agreement with HGC NEXT INV LLC, an affiliate of the Hanwha Group. The Hanwha Group has communicated its intention to appoint a new director to the Board, although no specific timeline has been provided for this appointment. These developments are part of the company’s recent updates.
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