NextDecade Soars 14% as Rio Grande LNG Runs “A Quarter Ahead” of Schedule

Key Takeaways

• NextDecade jumped 14% after saying Rio Grande LNG’s Train 1 should finish in the third quarter of 2027, a quarter ahead of schedule.
• NextDecade also sees margins averaging above $6 per MMBtu on its early sales, more than $1 above its base case.
• Cheniere’s raised guidance and Venture Global’s early-cargo profits suggest US LNG exporters are getting paid well.
• NextDecade keeps only up to 20.8% of Phase 1’s cash, and analysts see free cash flow negative through 2028.

NextDecade (NEXT) jumped 14% today after Chairman and CEO Matt Schatzman said Train 1 at Rio Grande LNG should reach substantial completion in the third quarter of 2027, “a quarter ahead of the guaranteed completion schedule under our EPC contract with Bechtel.”

Other US LNG exporters rose too: Cheniere Energy (LNG) rose 5.5% on a beat-and-raise, and Venture Global (VG) gained 3%. Both are already collecting what NextDecade is racing toward.

The Finish Line Moved Up

First LNG is now expected in the second quarter of 2027, the back end of the “first half of 2027” NextDecade gave in July.

Analysts already model $2.45 billion of revenue in 2027, from none today:

First LNG still lands inside the window those two analysts were working with, so I wouldn’t expect the timing to move 2027 much. The price could.

The Price Is the Bigger News

NextDecade now projects implied margins averaging more than $6 per MMBtu on its sales from Train 1’s start-up until Train 5’s long-term contracts begin, more than $1 above its base case. That blends about 175 TBtu it sold in the first quarter with uncontracted volumes priced at current forward curves. Schatzman’s reason: “Spot LNG prices remain strong due to the loss of supply from the Middle East.”

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Cheniere’s quarter backs that up. Its third-quarter net income rose to $1.17 billion from $1.05 billion, and it raised its 2026 adjusted EBITDA guidance to $8.75-$9.25 billion. But analysts see its earnings per share slipping to $20.72 in 2027, from $23.13 in 2026, just as Rio Grande starts shipping. Can NextDecade’s spot margins hold up through that?

Venture Global shows what this stretch can be worth: its second-quarter net income jumped to $1.35 billion from $368 million, mainly on Plaquemines cargoes sold while still commissioning. Its Nov. 10 report should say whether Plaquemines Phase 1 still reaches commercial operation this quarter.

NextDecade Keeps Only a Slice of Phase 1

Most of that early cash won’t reach NextDecade’s shareholders. Its stake entitles it to up to 20.8% of Phase 1’s distributions of available cash, with its partners taking the rest. Its share starts at 40% on Train 4 and 50% on Train 5, but those trains are only 22.5% and 14.0% complete.

With construction still running, the one analyst modeling free cash flow sees it deeply negative through 2028:

What NextDecade Needs to Show Before First LNG

The early finish is nice, and the better pricing is what makes today’s jump look earned. But those $6 margins rest on forward prices and on Middle East supply losses that could ease before Rio Grande’s first cargo sails, and NextDecade keeps only about a fifth of Phase 1’s cash. NextDecade still expects first gas into the plant before year-end, and Venture Global’s Nov. 10 report will be another check on early-cargo pricing.

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