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NextDecade’s Rio Grande enters $356 million senior loans
By Marisa Wong
Los Angeles, Sept. 20 – NextDecade Corp. announced that subsidiary Rio Grande LNG, LLC has entered into a credit agreement with a group of lenders for $356 million of senior loans, according to a press release.
The loans will be used to finance a portion of the first three LNG trains (Phase 1) at NextDecade’s 27 million tonnes per annum (MTPA) Rio Grande LNG export facility in Brownsville, Tex.
The senior loans were disbursed in one advance for the full amount of $356 million on Sept. 15, which resulted in a reduction in the commitments outstanding under Rio Grande’s existing term loan facilities for Phase 1, from $11.1 billion to under $10.8 billion.
These senior loans will mature in July 2033, will accrue interest at a fixed rate of 6.72% and rank pari passu to Rio Grande’s existing term loan facilities, the $500 million working capital facility and the $700 million of 10-year senior notes issued at final investment decision of Phase 1.
The company said this financing transaction aligns with its long-term balance sheet strategy for Phase 1, which includes extending and staggering debt maturities, diversifying sources of capital, reducing bank capital over time to provide potential capacity for financing future LNG expansions and mitigating interest rate exposure.
As of Sept. 20, Rio Grande’s outstanding fixed-rate debt and executed interest rate swaps have reduced its exposure to movement in interest rates for over 80% of the debt currently projected to be incurred in support of Phase 1 construction.
NextDecade is an energy company working on more sustainable LNG and carbon capture solutions.
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