Shares of energy company NextDecade (NASDAQ:NEXT) are up nearly 28% at the time of writing today after it entered into key framework agreements with Global Energy Partners (GIP) and Total Energies regarding the Rio Grande Project.
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Under the agreements, GIP will become a majority investor in Phase 1 of the project and Total will own 16.67%. The move is anticipated to also provide options to invest in Train 4 and 5 as well as the planned carbon capture and sequestration (CCS) project for GIP as well as Total.
Further, Total will buy 5.4 MTPA of LNG from Phase 1 for a period of 20 years. It has also agreed to acquire a 17.5% stake in NextDecade for about $219.4 million. NextDecade anticipates selling a total of 45.1 million shares at an average of $4.86 per share under the deal.
Importantly, the deal is a major boost for NexttDecade in a world moving towards sustainable energy. Patrick Pouyanne, the Chairman and CEO of TotalEnergies commented, “Our involvement in this project will enhance our LNG capacity by 5.4 MTPA strengthening our ability to ensure Europe’s gas supply security and to provide Asian customers with an alternative fuel that emits half as much as coal.”
Today’s price gains come on top of a nearly 10% rise in NextDecade shares so far this year.
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