NextDecade(NEXT) - 2024 Q3 - Quarterly Report

Project Overview - 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]. - The Rio Grande LNG Facility is authorized to export up to 27 MTPA of LNG from up to five liquefaction trains, with Phase 1 expected to have a nameplate capacity of approximately 17.6 MTPA[52]. - The total expected capital costs for Phase 1 are estimated at approximately $18.0 billion, which includes EPC costs, owner's costs, contingencies, and financing costs[58]. - Future phases of development at the Rio Grande LNG Facility will require significant capital deployment, predominantly financed through future debt and equity offerings[71]. Construction and Engineering - As of September 2024, the overall project completion percentage for Trains 1 and 2 was 30.5%, with engineering at 76.1% complete and procurement at 57.6% complete[47]. - The construction of the Rio Grande LNG Facility is being managed under fully wrapped, lump-sum turnkey engineering, procurement, and construction contracts with Bechtel Energy Inc.[46]. - As of September 2024, Bechtel has issued approximately 96% of the total purchase orders for Trains 1 and 2, and approximately 98% for Train 3[52]. - The company has finalized an EPC contract with Bechtel for Train 4, with price validity extending through December 31, 2024[60]. Financing Activities - 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[49]. - The company issued $190 million of senior secured notes in February 2024 to finance a portion of Phase 1, with a fixed interest rate of 6.85%[68]. - The company expects to finance construction of Train 4 through a combination of debt and equity funding, with equity partners potentially providing approximately 60% of the equity funding required[62]. - Rio Grande LNG Facility Phase 1 financing includes 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[70]. Sales and Agreements - 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)[49]. - Rio Grande has entered into long-term LNG Sale and Purchase Agreements (SPAs) with nine counterparties for a total of approximately 16.2 MTPA, representing over 90% of Phase 1's expected production capacity, with a weighted average term of 19.2 years[53][55]. - The Company has entered into long-term SPAs for over 90% of the expected Phase 1 LNG production capacity, providing stable cash flows[46]. - An LNG SPA with ADNOC for the sale of 1.9 MTPA of LNG from Train 4 has been entered into, along with a non-binding HoA with Aramco for 1.2 MTPA[61]. Operational Performance - Operating cash outflows for the nine months ended September 30, 2024, were $86.7 million, an increase from $52.6 million in the same period of 2023, primarily due to higher employee costs and professional fees[74]. - Investing cash outflows for the nine months ended September 30, 2024, amounted to $1,879.6 million, compared to $1,010.4 million for the same period in 2023, driven by increased construction activity[75]. - Financing cash inflows for the nine months ended September 30, 2024, totaled $1,937.6 million, up from $1,446.1 million in the same period of 2023, primarily due to increased debt and equity commitment proceeds[76]. - Net loss attributable to common stockholders for the three months ended September 30, 2024, was $123.2 million, compared to a net income of $107.6 million for the same period in 2023, reflecting a decrease of $230.8 million[79]. - General and administrative expenses for the nine months ended September 30, 2024, increased by approximately $24.8 million compared to the same period in 2023, mainly due to higher professional fees and employee costs[80]. - The company reported a cash balance of $265.8 million at the end of the period, down from $445.9 million at the beginning of the period[73]. Regulatory and Legal Matters - The U.S. Court of Appeals vacated the FERC reauthorization of the Rio Grande LNG Facility, but construction on Phase 1 continues while the appeals process is ongoing[49]. - The company has substantial doubt about its ability to continue as a going concern within one year, based on cash and cash equivalents of $38.2 million as of September 30, 2024[71]. Sustainability Initiatives - The company is developing carbon capture and storage (CCS) projects alongside the LNG facility to enhance its sustainability efforts[45]. - The company is in the process of executing a diversified natural gas feedstock sourcing strategy to mitigate risk across multiple contracts and pricing hubs[60]. Future Outlook - The commercial operation date for the first train of Phase 1 is expected in late 2027, indicating a significant timeline for cash flow generation[71]. - The Company expects to receive approximately 20.8% of distributions from Phase 1 operations, contingent on equity partners receiving their agreed distribution threshold[46].