NextDecade to Appeal Court Ruling Overturning Rio Grande LNG Project Approval
(Reuters) — U.S. liquefied natural gas (LNG) developer NextDecade said on Wednesday it will appeal a court ruling that overturned federal approval for its $18 billion Rio Grande LNG project and warned loss of its permits could prevent access to its loans.
"Its ability to continue borrowing under such credit facilities could be negatively impacted," Next Decade told the market.
Background: U.S. Court Overturns FERC Approval for NextDecade’s $18 Billion Rio Grande LNG Project
The company's stock price has slumped 38% since the judgment, finishing at $4.84 on Wednesday down from its close on Aug. 5.
NextDecade said there is no guarantee how long any agency proceedings and judicial challenges will take to be resolved, if there will be delays in construction activities or if Rio Grande will ultimately succeed in maintaining the permits.
The judicial decision would not come into effect until the court issued a mandate, which was not expected to occur until the appeals process has been completed, NextDecade said.
"If the ruling stands, the precedent set impacts the viability of all federally permitted infrastructure projects because it will be difficult for developers to attract capital investments until projects receive final unappealable permits," CEO Matt Schatzman said.
Next Decade's flagship facility has been in development for several years and has already suffered repeated delays.
The first phase of the project, with a capacity of 17.61 million tons per annum (MTPA), is due to be completed by early 2029 at an expected cost of about $18 billion.
The company, backed by the likes of Global Infrastructure Partners and French energy major Total Energies, said that overall project completion of the first two liquefaction units, called trains, stands at 24.1%, as of June.
It has received purchase orders of about 92% of total capacity for the first two trains and 88% of the total for the third train.
The company was planning to start construction of the fourth train in the second half of 2024 after a final investment decision and said it is assessing the implications of the court ruling with its equity partners and lenders.
Related News
Related News
- Trump Aims to Revive 1,200-Mile Keystone XL Pipeline Despite Major Challenges
- Valero Considers All Options, Including Sale, for California Refineries Amid Regulatory Pressure
- ConocoPhillips Eyes Sale of $1 Billion Permian Assets Amid Marathon Acquisition
- ONEOK Agrees to Sell Interstate Gas Pipelines to DT Midstream for $1.2 Billion
- Energy Transfer Reaches FID on $2.7 Billion, 2.2 Bcf/d Permian Pipeline
- U.S. LNG Export Growth Faces Uncertainty as Trump’s Tariff Proposal Looms, Analysts Say
- Tullow Oil on Track to Deliver $600 Million Free Cash Flow Over Next 2 Years
- Energy Transfer Reaches FID on $2.7 Billion, 2.2 Bcf/d Permian Pipeline
- GOP Lawmakers Slam New York for Blocking $500 Million Pipeline Project
- Texas Oil Company Challenges $250 Million Insurance Collateral Demand for Pipeline, Offshore Operations
Comments