Shares of NextDecade (NASDAQ: NEXT) rallied more than 18% by 1:30 p.m. EDT on Friday. Fueling the LNG stock was an agreement with Occidental Petroleum (NYSE: OXY) on a potential carbon dioxide transportation and storage project associated with its Rio Grande development.
NextDecade has signed a term sheet with a subsidiary of Occidental for the offtake and permanent geological storage of carbon dioxide from its planned Rio Grande project in Texas. Under the terms, Occidental’s Oxy Low Carbon Ventures will receive carbon dioxide from the site and transport it to an underground geologic formation in the Rio Grande Valley where there’s ample storage capacity for carbon dioxide. This agreement will support NextDecade’s proposed carbon capture and storage project associated with the Rio Grande liquified natural gas (LNG) development. It would enable the company to capture and store more than five million tonnes of carbon dioxide per year.