Nextdecade Corporation · NASDAQ:NEXT
Nextdecade — Investor Presentation (September 2017)
38 slides from Nextdecade's investor presentation, September 2017
Slide 1: NextDecade Corporation Presentation, September 2017
S EPTEMBER 2017 Developing Low-Cost LNG Export Solutions from the Permian Basin and Eagle Ford Shale in South Texas NEXTDECADE CORPORATION NASDAQ: NEXT PRESENTATION STRICTLY CONFIDENTIAL
Slide 2: Disclaimer and Forward Looking Statements
Disclaimer and Forward Looking Statements This Presentation includes forward-looking statements within the meaning of Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact contained in this Presentation, including statements regarding the future re
Slide 3: Contents
Contents 01 Summary 3 02 Overview 7 03 Management Team and Partners 12 04 LNG Market Overview 17 05 Project Overview 26 06 Contact Information 36
Slide 4: Summary
oy NEXTDECADE @ LV *Portioio ING Company Summary
Slide 5: Introduction
Introduction NextDecade is a liquefied natural gas (“LNG”) development company focused on LNG export projects and associated pipelines in the State of Texas. The management team is comprised of industry leaders with experience across the global LNG value chain. NextDecade’s first proposed LNG export
Slide 6: Highlights (1 of 2)
Highlights (1 of 2) Merger and Public Listing • On July 24, 2017, NextDecade completed a business combination with Harmony Merger Corp., resulting in NextDecade becoming a publicly traded company (NASDAQ: NEXT) Capital Cost, Liquefaction Technology, Engineering • Selected proven and widely utilized
Slide 7: Highlights (2 of 2)
Highlights (2 of 2) Commercial • Executed non-binding Heads of Agreement (“HOAs”) with prospective customers; sale and purchase agreement (“SPA”) discussions ongoing with customers in Asian, European, and other global markets • Choice of flexible offtake contracting models such as tolling, free on b
Slide 8: Overview
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Slide 9: NextDecade: Overview
NextDecade: Overview NextDecade is a LNG development company focused on LNG export projects and associated pipelines in the State of Texas. NextDecade’s first proposed LNG export facility, RGLNG in Brownsville, Texas, along with the associated RBPL originating in the Agua Dulce market area, are well
Slide 10: NextDecade: Company Highlights
NextDecade: Company Highlights • The RGLNG project is a planned LNG export facility to be located in the Port of Brownsville, Texas. The associated 137-mile RBPL is to originate in the Agua Dulce market area. Together, the projects are positioned to monetize gas reserves of West and South Texas, ben
Slide 11: Portfolio Growth: Opportunities & Differentiators
Portfolio Growth: Opportunities & Differentiators NextDecade is a portfolio company that has significant prospects for growth through various incremental opportunities and differentiators. While the management team remains focused on advancement and development of NextDecade’s Rio Grande LNG facilit
Slide 12: NextDecade: Summary Projections
NextDecade: Summary Projections Shown below are summary projections for NextDecade including anticipated operations at its RGLNG and RBPL facilities. NextDecade Summary Projections ($ Millions) 2017E 2018E 2019E 2020E 2021E 2022E 2023E 2024E 2025E 2026E 2027E (1) Revenue $ - $ - $ - $ - $ - $ 593 $
Slide 13: Management Team and Partners
3 Management Team and Partners
Slide 14: NextDecade: Management
NextDecade: Management NextDecade is supported by a management team that has experience developing some of the most successful projects across the global LNG value chain. Kathleen Eisbrenner oversees development and execution of NextDecade’s liquefaction and pipeline strategies. She was formerly exe
Slide 15: NextDecade: Management
NextDecade: Management NextDecade is supported by a management team that has experience developing some of the most successful projects across the global LNG value chain. Shaun Davison leads NextDecade’s commercial project development efforts in North America. Davison has spent more than 20 years in
Slide 16: NextDecade: Management LNG Experience
NextDecade: Management LNG Experience The management team at NextDecade possesses extensive LNG experience and, at prior projects, has successfully executed numerous long-term LNG contracts. Projects and companies associated with the management team’s industry experience are detailed below. Regasifi
Slide 17: World-Class Partners
World-Class Partners EPC Contractor • One of the world’s premier LNG EPC firms, CB&I has been involved in the development of LNG projects for over 50 years • NextDecade is in the process of finalizing detailed negotiations for a LSTK EPC contract with CB&I, including performance, time, and cost guar
Slide 18: LNG Market Overview
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Slide 19: Global LNG Market: Highlights
Global LNG Market: Highlights LNG demand is projected to rise for the foreseeable future, driven by a number of factors. While currently oversupplied, the LNG market is expected to enter a prolonged period of shortage in the early 2020s, according to an array of industry consultants. • Strengthening
Slide 20: LNG Demand: Powerful Forces Support Growth
LNG Demand: Powerful Forces Support Growth Global environmental considerations in addition to burgeoning technologies and market applications are further anticipated to increase LNG demand. Ø Environmental and Political Drivers. Many countries have implemented clean energy policies, aimed at lowerin
Slide 21: U.S. Gulf Coast LNG: Highlights
U.S. Gulf Coast LNG: Highlights NextDecade’s commercial progress to date indicates strong market interest and, more specifically, interest in feed gas sourced from West and South Texas, which benefits from low-cost associated gas as production in key basins (Permian Basin and Eagle Ford Shale) is ex
Slide 22: LNG Market Overview: Demand
LNG Market Overview: Demand NextDecade believes the LNG market is headed towards a shortage, likely to occur between 2022-2024, driven by growing demand and certain supply challenges. In 2015, the global LNG trade topped 244 million tons, and is poised to grow at a 5.5-7.5% CAGR through 2024. 1 Next
Slide 23: LNG Contract Roll-Off
LNG Contract Roll-Off Through 2023, 80 mtpa of demand (and 190 mtpa through 2030) is expected to free up as legacy contracts expire and customers look to switch to U.S. LNG providers; we believe ND is well positioned to capitalize on these anticipated roll-off volumes. Contract Roll-Off Volume by Ye
Slide 24: FSRU Growth: Ideally Placed to Capitalize
FSRU Growth: Ideally Placed to Capitalize FSRUs present a valuable opportunity for NextDecade to access developing and/or underserved LNG markets, including those seeking to replace declining gas reserves with LNG. Members of NextDecade’s management team’s experience with FSRUs is a source of compet
Slide 25: LNG Market Overview: Supply
LNG Market Overview: Supply While the quantum of proposed projects around the world indicates a much larger surplus than projected, many proposed projects are unlikely to take FID and contribute to global supply for a number of reasons, including feed gas issues, regulatory challenges, environmental
Slide 26: U.S. Production: Significant Cost Advantages
U.S. Production: Significant Cost Advantages U.S. LNG has emerged as a new source of low-cost supply by bringing new technologies to market, lowering capital requirements, breaking industry orthodoxy of oil-linked contracts, and utilizing its well-established regulatory process. Shown below, U.S. Gu
Slide 27: Project Overview
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Slide 28: Rio Grande LNG: Commercial
Rio Grande LNG: Commercial NextDecade has made substantial progress with prospective customers to date. NextDecade is in the midst of advanced negotiations with prospective customers in key Asian, European, and other global markets that comprise portfolio buyers, traders, and utilities in these juri
Slide 29: Gas Supply: Permian Basin and Eagle Ford Shale
Gas Supply: Permian Basin and Eagle Ford Shale Both capital spending and production are expected to rise precipitously in the coming years. Permian Gas Production (Bcf/d) Eagle Ford Gas Production (Bcf/d) 10 9 $80 WTI 8 $50 WTI 7 6 5 4 $30 WTI 3 2 Natural 1 Decline 0 2010 2012 2014 2016 2018 2020 •
Slide 30: Comparison: U.S. Reserve Basins
Comparison: U.S. Reserve Basins Permian production costs are among the lowest across U.S. basins, providing ample scope to absorb transport costs from Waha to Agua Dulce. Gas Breakeven* Rank Play $/mmbtu 1 Permian - Midland $(6.31) 2 Permian - Delaware (2.69) 3 Eagle Ford (0.31) 13 4 Permian - Alpin
Slide 31: Permian Basin: A World-Class Reserve Base
Permian Basin: A World-Class Reserve Base The Permian Basin saw nearly $30 billion of M&A activity in 2016, approximately half of all U.S. upstream M&A activity showcasing elevated interest among producers. Drilling and Completion (D&C) spending in the Basin is expected to more than double (YoY) by
Slide 32: Next Wave of LNG: Texas Stranded Gas
Next Wave of LNG: Texas Stranded Gas Historically, most international LNG projects were constructed on the premise of necessity to move “stranded gas” (supply push) to large demand markets such as Asia and Europe. Recently, US LNG capacity expansions have been driven by a “demand pull” and a price a
Slide 33: Rio Grande LNG: Engineering
Rio Grande LNG: Engineering RGLNG’s EPC liquefaction costs are expected to be among the most competitive in the world due to NextDecade’s close collaboration with its EPC contractor (Chicago Bridge & Iron) and equipment providers (GE Oil & Gas), as well as its use of proven technology (AP-C3MR™). Ca
Slide 34: CB&I: LNG EPC Expert
CB&I: LNG EPC Expert CB&I is a preeminent LNG EPC contractor with over fifty years of experience on some of the largest projects in the world, an exceptional training and safety record, and a deep relationship with the Rio Grande Valley workforce. • CB&I has deep experience with the LNG industry, ha
Slide 35: Rio Grande LNG: Regulatory
Rio Grande LNG: Regulatory NextDecade filed its formal FERC application in May 2016 and has allocated significant time and resources to advance the regulatory processes with FERC and other agencies. Regulatory Highlights • NextDecade commenced pre-filing with FERC in March 2015 and filed its formal
Slide 36: Rio Bravo Pipeline: Overview
Rio Bravo Pipeline: Overview 8 Interconnects Compressor Station #1 • At full build-out, the RBPL will comprise two, parallel 137-mile long, 42- Interconnect Booster inch natural gas pipelines Stations (2) • Each of the two pipelines is expected to have a capacity of up to 2.25 Bcf/d (up to 4.5 Bcf/d
Slide 37: Contact
Contact COMMUNICATIONS Ward CC (for NextDecade) 5959 West Loop South, Suite 510 Bellaire, Texas 77401 USA Molly LeCronier, Vice President T: + 1 (713) 869 0707 | E: mlecronier@wardcc.com INVESTORS AND CORPORATIONS NextDecade Corporation 3 Waterway Square Place, Suite 400 The Woodlands, Texas 77380 U
Slide 38: ü Experienced team ü Extensive commercial relationships
ü Experienced team ü Extensive commercial relationships ü Strategic partners ü Expertise along the value chain ü Proven technology ü Substantial de-risking accomplished ü Favorable site ü Key development milestones completed ü Strong regional political support Artist rendering of NextDecade’s propos