Enbridge to Purchase Rio Bravo Pipeline from NextDecade
(P&GJ) — NextDecade Corporation and Enbridge announced that they have entered into a definitive agreement whereby Enbridge will acquire Rio Bravo Pipeline Company, LLC from NextDecade.
The agreement includes a cash purchase price not to exceed $25 million, with $15 million paid at closing and the balance paid upon NextDecade’s reaching a positive final investment decision on its Rio Grande LNG export facility in the Port of Brownsville, Texas.
Upon closing of the transaction, Enbridge will own 100% of RBPL and assume all responsibility for the development, financing, construction, and operations of the Rio Bravo Pipeline. NextDecade will continue to be responsible for the development, financing, construction, and operations of its Rio Grande LNG export facility.
In addition, Enbridge and NextDecade have negotiated a precedent agreement, to be executed at closing, whereby NextDecade will retain its rights to the natural gas firm transportation capacity on the Rio Bravo Pipeline for a term of at least 20 years to supply NextDecade’s Rio Grande LNG export facility.
“As one of North America’s leading energy infrastructure companies, Enbridge brings extensive natural gas pipeline experience to execute the Rio Bravo Pipeline, and we are delighted to have them involved in supporting the delivery of our Rio Grande LNG project,” said Matt Schatzman, NextDecade’s Chairman and Chief Executive Officer.
The Rio Bravo Pipeline is designed to transport up to 4.5 billion cubic feet per day of natural gas from the Agua Dulce supply area to NextDecade’s Rio Grande LNG project in Brownsville, Texas.
In November 2019, the Federal Energy Regulatory Commission (FERC) issued an order authorizing the siting, construction, and operation of NextDecade’s Rio Grande LNG project and the Rio Bravo Pipeline.
In January 2020, FERC issued a final order on rehearing for the Rio Grande LNG project and the Rio Bravo Pipeline.
The agreement has been approved by the Boards of Directors of both companies and is scheduled to close in the first quarter of 2020.
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