ConocoPhillips to buy LNG from NextDecade's Rio Grande Train 5 project

Sept 8 (Reuters) - U.S. oil and gas producer ConocoPhillips COP.N will purchase 1.0 million tonnes per annum of liquefied natural gas from NextDecade's NEXT.O Rio Grande export facility in Texas for 20 years, the companies said on Monday.

NextDecade will supply the superchilled fuel from its fifth liquefaction facility, also known as a train, at Rio Grande.

Shares of the LNG producer rose 2.3% in extended trading.

The U.S. LNG sector has seen a surge in commercial activity since President Donald Trump lifted a pause on new export permits in January. The freeze, originally imposed by the previous administration in 2024 for a review of the public interest criteria, was reversed shortly after Trump took office.

With new projects now under construction and others expected to receive financial approval this year, the U.S. - the world's largest LNG exporter - could triple its export capacity by 2030.

NextDecade has been building its Rio Grande LNG facility with a capacity of 17.6 mtpa and is also developing its Train 4 and 5 with a combined additional capacity of 10.8 mtpa.

Its agreement with ConocoPhillips will be on a free-on-board basis at a price indexed to Henry Hub, subject to a positive final investment decision on Train 5, which is expected in the fourth quarter.

NextDecade said it has announced a total of 4.5 mtpa of LNG from Train 5 sold under 20-year agreements. That, according to the company, is sufficient to support a positive FID on Train 5. It has completed the commercialization of Train 5.

LNG developers typically reach an FID on projects once they have secured enough supply deals to obtain the necessary financing for construction.

NextDecade has signed similar deals with top oil producer Saudi Aramco 2222.SE, TotalEnergies TTEF.PA, Japan's biggest power generator JERA, and EQT EQT.N.