NextDecade Secures Long-Term LNG Deal with TotalEnergies

NextDecade Corporation (NEXT) has finalized a significant long-term liquefied natural gas (LNG) supply agreement with TotalEnergies Gas & Power North America, a subsidiary of TotalEnergies SE (TTE). According to the agreement, TotalEnergies will purchase 1.5 million tons per annum (MTPA) of LNG for a duration of 20 years on a free-on-board basis, with pricing linked to the Henry Hub benchmark.

Recognizing TotalEnergies’ key role in the success of the Rio Grande LNG Phase 1, NEXT expresses satisfaction in expanding its collaboration with TTE through this Train 4 agreement.

Overview of the Rio Grande LNG Project

The Rio Grande LNG project is the largest privately funded LNG initiative in Texas, located on a 984-acre site at the Port of Brownsville. Its strategic location offers easy access to the Permian Basin and Eagle Ford shale, which ensures a consistent supply of natural gas, largely insulated from weather-related disruptions that often affect other Gulf Coast sites. For investors, NEXT’s increase in sale and purchase agreements is crucial as it paves the way for a positive Final Investment Decision (FID), expediting project completion. The securing of new contracts enhances the company’s near-term prospects, fostering a beneficial trajectory for both NEXT and its stakeholders.

Advancements Toward a Positive Final Investment Decision

With this recent sale and purchase agreement, NextDecade—currently rated Zacks Rank #3 (Hold)—has now obtained a total of 4.6 MTPA in long-term contracts for Train 4. This includes agreements with key industry players such as Saudi Aramco. Management believes that the commercial backing is sufficient to enable a positive Final Investment Decision for Train 4.

For a complete list of today’s Zacks #1 Rank (Strong Buy) stocks, you can see here.

Looking Ahead for TotalEnergies

TotalEnergies, which currently exports over 10 MTPA of LNG from the U.S., has set a goal to increase that to 15 MTPA by 2030. This agreement represents a significant step towards achieving that target.

Despite facing delays, with the first train projected to launch by 2027, NEXT’s commitment from TotalEnergies indicates positive momentum. With necessary commercial support now established, NextDecade is focusing on the financial and logistical preparations to activate Train 4. If successful, this phase could mark a pivotal moment for both NextDecade and the LNG sector at large.

Investment Opportunities

Investors interested in the energy sector may want to consider top-ranked stocks like Archrock, Inc. (AROC) and Delek Logistics Partners, LP (DKL).

Based in Houston, Archrock provides natural gas contract compression services and aftermarket support for compression equipment. AROC focuses on oil- and gas-producing regions in the U.S., with the Zacks Consensus Estimate forecasting a 56.19% year-over-year growth in earnings for 2025.

Delek Logistics Partners engages in the ownership, operation, acquisition, and construction of logistics and marketing assets for crude oil and refined products. DKL operates transportation and gathering systems, alongside storage solutions for crude oil. Its Zacks Consensus Estimate for 2025 earnings suggests a year-over-year growth of 34.45%.

7 Stocks to Watch for Potential Growth

Savvy investors can now access the 7 elite stocks identified by experts as the “Most Likely for Early Price Pops” from a current pool of 220 Zacks Rank #1 Strong Buys.

This select group has historically outperformed the market, with an average annual gain of +23.9% since 1988. Make sure to give these recommendations your immediate attention.

Want the latest recommendations from Zacks Investment Research? Download the 7 Best Stocks for the Next 30 Days for free.

Additional Stock Analysis Reports:

• Delek Logistics Partners, L.P. (DKL)
• Archrock, Inc. (AROC)
• NextDecade Corporation (NEXT)
• TotalEnergies SE Sponsored ADR (TTE)

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.