NextDecade(NEXT) - 2024 Q2 - Quarterly Report

Project Development and Construction - The Rio Grande LNG Facility is authorized to export up to 27 million tonnes per annum (MTPA) from five liquefaction trains, with three trains currently under construction[45]. - As of June 2024, the overall project completion percentage for Trains 1 and 2 was 24.1%, with engineering at 66.4% complete and procurement at 45.4% complete[47]. - The overall project completion percentage for Train 3 was 7.8% as of June 2024, indicating progress in line with the EPC contract schedule[47]. - The EPC contract for Train 4 and related infrastructure is valued at approximately $4.3 billion, with price validity extending through December 31, 2024[48]. - The Rio Bravo Pipeline will provide access to natural gas supplies and is expected to be completed before commissioning of Train 1[6]. - The commercial operation date for the first train of Phase 1 is expected in late 2027, indicating a long-term capital requirement for future phases of development[70]. Financial Performance and Capital Structure - In June 2024, the Company issued $1.115 billion of senior secured notes to reduce outstanding borrowings, with a fixed interest rate of 6.58% and a final maturity in September 2047[47]. - The Company has refinanced over $1.85 billion of the original $11.1 billion Rio Grande term loan facilities since the positive FID on Phase 1 in July 2023[48]. - The average fixed fees under the Phase 1 SPAs are expected to total approximately $1.8 billion annually, unadjusted for inflation[4]. - Rio Grande LNG Facility Phase 1 has secured approximately $6.2 billion in equity capital commitments and $11.6 billion in senior secured non-recourse bank credit facilities, with total estimated costs of $18.0 billion[69]. - Financing cash inflows for the six months ended June 30, 2024, were $1,305.7 million, significantly higher than $74.9 million in the same period of 2023, driven by proceeds from borrowings and equity commitments[75]. Sales Agreements and Contracts - The Company entered into a 20-year LNG Sale and Purchase Agreement (SPA) with ADNOC for 1.9 MTPA of LNG from Train 4, subject to a positive final investment decision (FID)[48]. - Rio Grande has signed long-term LNG SPAs with nine counterparties for a total of approximately 16.2 MTPA, representing over 90% of Phase 1's expected production capacity[3]. - A positive final investment decision for Train 4 is anticipated, with an LNG SPA for 1.9 MTPA already signed with ADNOC[7]. Cash Flow and Expenses - Operating cash outflows for the six months ended June 30, 2024, were $22.8 million, a decrease from $41.2 million in the same period of 2023, primarily due to cash received from derivative settlements[73]. - Investing cash outflows surged to $1,374.3 million for the six months ended June 30, 2024, compared to $56.5 million in the same period of 2023, mainly due to construction costs for Phase 1 of the Rio Grande LNG Facility[74]. - General and administrative expenses increased by approximately $7.1 million for the three months ended June 30, 2024, compared to the same period in 2023, mainly due to higher professional fees and employee costs[77]. Net Loss and Derivative Gains - Net loss attributable to common stockholders for the three months ended June 30, 2024, was $32.6 million, or $(0.13) per share, compared to a net loss of $127.0 million, or $(0.84) per share, for the same period in 2023[77]. - The company reported a net loss attributable to common stockholders of $4.2 million, or $(0.02) per share, for the six months ended June 30, 2024, compared to a net loss of $161.1 million, or $(1.08) per share, for the same period in 2023[77]. - Derivative gain for the three months ended June 30, 2024, was $109.1 million, primarily due to an increase in forward SOFR rates and cash received from derivative settlements[77]. Sustainability Initiatives - The company is developing a carbon capture and storage (CCS) project at the Rio Grande LNG Facility to enhance sustainability and reduce greenhouse gas emissions[45]. - The company is developing a diversified natural gas feedstock sourcing strategy to mitigate risk across multiple contracts and pricing hubs[10]. Regulatory and Legal Matters - The U.S. Court of Appeals for the D.C. Circuit vacated the FERC remand authorization for the Rio Grande LNG Facility, but construction continues while the Company assesses its options[48]. Going Concern - The company has substantial doubt about its ability to continue as a going concern within one year, with cash and cash equivalents of $38.1 million and available commitments under a revolving loan facility of $26.2 million as of June 30, 2024[70].