(From left): NextDecade chairman and CEO Matthew Schatzman, Aramco upstream president Nasir Al-Naimi and Aramco executive vice-president of gas Abdulkarim Al-Ghamdi. Credit: Saudi Arabian Oil Co.

Saudi Aramco has signed a non-binding heads of agreement (HOA) with NextDecade for a 20-year supply of LNG.  

This deal will involve NextDecade supplying LNG from its proposed train 4 at the Rio Grande LNG Facility, located at the Port of Brownsville in the US state of Texas. 

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Under the terms of the agreement, Saudi Aramco will purchase 1.2 million tonnes per annum (mtpa) of LNG on a free-on-board basis.  

The pricing will be indexed to the Henry Hub, a benchmark for natural gas prices in North America.  

Both companies are actively negotiating a binding agreement, which will be contingent upon a positive final investment decision on train 4 of the Rio Grande facility. 

Aramco upstream president Nasir Al-Naimi said: “We look forward to finalising the terms of a long-term LNG offtake agreement with NextDecade, as we explore opportunities to expand our presence in international energy markets. We expect LNG to play an important role in meeting the rising demand for secure and efficient energy.” 

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NextDecade chairman and CEO Matt Schatzman said: “We are pleased to have reached a heads of agreement with Aramco for LNG from train 4, as Aramco seeks to expand its LNG portfolio.  

“We look forward to finalising the LNG SPA [sale and purchase agreement] with Aramco and to pursuing other opportunities together.” 

The announcement of this potential deal follows reports of discussions between Aramco and US-based Tellurian.  

As per the reports, Aramco was considering acquiring a stake in Tellurian’s Driftwood LNG plant, which boasts a capacity of 27.6mtpa and is situated near Lake Charles, Louisiana.  

Tellurian has made substantial investments to finance and construct the Driftwood plant. 

Despite these efforts, Tellurian has encountered financial difficulties, issuing warnings to investors about the risk of insolvency before mid-2025.