NextDecade, Oxy Sign Texas CO2 Storage Deal
NextDecade Corporation (NASDAQ: NEXT) and Oxy Low Carbon Ventures (OLCV) have signed a term sheet for the offtake and permanent storage of CO2 captured from NextDecade’s planned Rio Grande LNG project in the Port of Brownsville, Texas, NextDecade has revealed.
Under the terms of the deal, OLCV will offtake and transport CO2 from the Rio Grande LNG project and permanently sequester it in an underground geologic formation in the Rio Grande Valley, pursuant to a CO2 Offtake Agreement and a Sequestration and Monitoring Agreement to be negotiated by the companies.
NextDecade anticipates achieving final investment decision (FID) on a minimum of two trains at Rio Grande LNG in 2021. Earlier this month, the company announced the formation of NEXT Carbon Solutions, a wholly owned subsidiary that is expected to develop one of the largest carbon capture and storage projects in North America at Rio Grande LNG. FID on NEXT Carbon Solutions’ CCS project is expected soon after FID at Rio Grande LNG.
“We are pleased to be working with OLCV to design, construct, and operate a CO2 pipeline and permanent storage facility in South Texas,” Matt Schatzman, NextDecade’s chairman and chief executive officer, said in a company statement.
“OLCV’s expertise and reliability complement the transformative and impactful contributions our NEXT Carbon Solutions business is making to the global energy industry, and in particular the proprietary processes we are advancing to lower the cost of utilizing CCS technology,” he added.
Richard Jackson, Occidental’s President, Operations, U.S. Onshore Resources and Carbon Management, said, “we are excited to partner with NextDecade to enable the supply of low-carbon natural gas to international markets”.
“Signing this agreement is an important milestone in scaling up OLCV’s pure sequestration business and providing services to help others achieve their net zero goals,” he added.
“The CO2 sequestration facility proposed for South Texas is a great example of the many sequestration hubs that OLCV plans to develop across the United States, and eventually around the globe,” Jackson went on to say.
The Rio Grande LNG project is expected to be the largest and greenest U.S. LNG export solution linking Permian Basin and Eagle Ford Shale natural gas to the global LNG market, according to NextDecade’s website.
NextDecade describes itself as a clean energy company accelerating the path to a net zero future. OLCV is a subsidiary of Occidental (NYSE: OXY), which was formed back in 2018 to sustainably enhance Oxy’s business.
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