Bechtel wins contract from NextDecade for LNG project in Texas

WCN Editorial Team 29 May 2019 NORTH AMERICA ENERGY & UTILITIES

Virginia-based project management services provider Bechtel has won an engineering procurement, and construction (EPC) contract from NextDecade for the first phase of Rio Grande liquefied natural gas (LNG) project.

The LNG project will be located in Brownsville, Texas, and will include three liquefaction trains, two 180,000m³ storage tanks and two marine berths. There is a chance to build an additional storage tank and LNG truck loading facilities.

Bechtel LNG general manager Darren Mort said: “Our LNG team is building on a proven track record of delivering world-class projects that help our customers bring an important energy source to the global economy.

“Our milestones are a testament to what the industry can accomplish with innovative approaches to technical challenges, and collaboration between owners, contractors, suppliers, and local communities.”

The EPC contract is for the first phase of the project and is valued at $9.5bn (£7.5bn). Each liquefaction train could have a capacity of up to 5.87mtpa of LNG, generating an EPC cost of about $543 (£430) per tonne for the first three trains.

The contract includes full site preparation activities, which could reduce the cost per tonne of the remaining trains to below the first phase of $543 per tonne. Additionally, the EPC contracts allow Bechtel to begin construction on the first phase at the project with either two or three trains.

Bechtel will perform limited notice to begin activities from June 2019 until January 2019 and has agreed to accept up to $15m (£11.9m) in common stock of NextDecade as consideration for certain activities.

NextDecade president and CEO Matt Schatzman said: “We are pleased to be working with Bechtel, who is responsible for constructing about 30 percent of the world’s LNG capacity.

“Bechtel’s extensive experience developing LNG projects on the U.S. Gulf Coast, along with our advantaged site and technology choices, including Air Products C3MR and Baker Hughes GE rotating equipment, is expected to enable NextDecade – in just the first three trains – to have the lowest cost per ton greenfield LNG project built on the U.S. Gulf Coast under a fully wrapped lump-sum turnkey EPC contract.”

Pending achievement of commercial milestones and receipt of final regulatory approvals, NextDecade expects to make a positive final investment decision on up to three trains of the Rio Grande LNG project as early as the end of the third quarter and begin operations in 2023.

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Image: Bechtel wins EPC contract to build LNG project in Texas. Photo: Courtesy ofolafpictures/Pixabay.

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