Good morning, and welcome to the Next Decade Corporation First Quarter 2026 Investor Call and Webcast. At this time, all participants are in a listen-only mode. A question and answer session will follow management's prepared remarks. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Should anyone require operator assistance during the conference, please press star zero. As a reminder, this conference is being recorded. And now I would like to turn the call over to Megan Light, Next Decade's Vice President of Investor Relations.

Thank you, and good morning, everyone. Welcome to Next Decade's first quarter, 2026 Investor Update Call and Webcast. The slide presentation and access to the webcast for today's call are available on our website at www.next-decade.com. Today, I am joined by Matt Schottman, Next Decade's Chairman and Chief Executive Officer, and Mike Mott, Next Decade's Interim Chief Financial Officer. Before we begin, I would like to remind listeners that discussion on this call, including answers to your questions, contains forward-looking statements within the meaning of U.S. federal securities law. These statements have been based on assumptions and analysis made by Next Decade in light of current expectations, perceptions of historical trends, current conditions, and projections about future events and trends. Although Next Decade believes that the expectations reflected in these forward-looking statements are reasonable, it can give no assurance that the expectations will prove to be correct. Next Decade's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in Next Decade's periodic reports that are filed with and available from the Securities and Exchange Commission. In addition, discussion on this call includes references to certain non-GAAP financial measures such as adjusted EBITDA and distributable cash flow. A definition of and additional information regarding these measures can be found in the appendix to our presentation. And now I will turn the call over to Matt Schatzman, Next Decade's Chairman and Chief Executive Officer.

Thank you, Megan, and good morning, everyone. Thank you for joining us today. First quarter was productive across the next decade organization. We're making solid progress on the key 2026 priorities that we introduced. First, one of our highest priorities continues to be progressing construction at the Rio Grande LNG facility, safely, on budget, and ahead of schedule. Safety is ingrained in our culture and our work, and in the first quarter, we achieve a low total recordable incident rate, or TRIR, of less than 0.1. I'm proud of both our team and the Bechtel team for continuing to progress construction at a rapid pace while maintaining high safety standards. We also continue to be within budget across all five trains under construction. Train 1 early electrical commissioning is underway. Phase 1 continues to track ahead of the guaranteed substantial completion dates per the EPC contracts, and we're making excellent early progress on trains four and five. Based on our current progress, phase one is tracking ahead of the schedule reflected in our early volume guidance, providing a buffer to achieve the numbers we have provided. Our second key priority for 2026 is continuing to prepare our organization for commissioning, first LNG, and the transition to operations. We've been advancing hiring, system implementations, and process development ahead of FIRST LNG. We've been rapidly hiring and expanding our team, and we currently have over 400 employees, with the majority based in Brownsville. As part of our enterprise readiness efforts, we've made significant progress building the digital and operational foundation required for FIRST LNG. Core enterprise platforms are starting to go live, and we've created robust in-house integration capability that allows systems to exchange data and supports end-to-end business processes this work positions us to scale efficiently reduce operational risk and enter operations with strong governance visibility and control across the enterprise we're laser focused on ensuring that the organization is prepared for introducing first gas into the facility in the second half of this year and producing the first lng from train one in the first half of next year our third key priority is to manage near-term exposure to LNG market margins through the sale of projected early LNG cargos. As we mentioned on the fourth quarter call, early this year, we began marketing early cargos that we expect to produce in phase one prior to the commencement of our long-term SPAs from train three. In February, we sold over 175 TBTU on a free onboard or FOB basis with fixed liquefaction fees that are expected to achieve margins calculated as the FOB sales price, lesser expected cost of natural gas feedstock and fuel of over $3 per MBTU. These sales reduced the phase one early LNG production exposed to LNG market price fluctuations by 33%. Market margins have increased since the Iran conflict began, and as we increase our visibility into expected early LNG production, gain additional assurance on the timing from Bechtel later this year and early next year, we expect to sell additional early volumes to further reduce our market exposure during our ramp-up period. Final key priority for this year is advancing the development and permitting of trains six through eight. Bechtel is in the process of performing a front-end engineering and design, or FEED, study for the train six and third berth, and we expect to follow the formal FERC application for train six before the end of this quarter. Additionally, we've begun early commercialization efforts for train six, and we're seeing strong demand for potential customers for long-term volumes. I'd like to remind everyone that additional LNG supplies were needed in the early 2030s before the Iran conflict began, and demand for long-term SPAs is even stronger today. Construction at the Rio Grande LNG facility continues to progress safely on budget and ahead of schedule. As of March 2026, trains one and two are 67.8% complete, 0.2% complete, and trains four and five are 10.6% and 6.8% complete respectively. Within these overall completion numbers, trains one and two are functionally complete on the engineering and procurement front, with the engineering of trains one and two just over 98% complete and the procurement just over 94% complete. Train three is not far behind trains one and two with engineering over 90% complete and procurement over 80%. Since our last update, Bechtel has continued to make strong progress in construction of phase one with work on train one focused on piping equipment installation cable the main cryogenic heat exchanger for train one has also been successfully installed trains two and three made noble progress on civil works piping structural steel and equipment installation and placement of the train to compressor packages is underway for tanks one and two welding of the inner tanks is progressing and concrete roof placement has been completed for both tanks Early civil works are progressing for train four, site preparation activities are underway for train five, and production piling is commenced for tank three. Across the site, construction of permanent buildings is advancing, construction activities of the gas inland area are ongoing, dredging activities for the burst and the turning basin are substantially complete, and channel deepening is nearing completion. Dayrunner pipeline has been under construction since last fall and is expected to reach in-service in the third quarter of this year. Bayrunner is being constructed by Whistler LLC, a joint venture between Whitewater Midstream, Enbridge, and MPLX, and will be our primary pipeline capacity into the terminal for trains one through three. Train one continues, and we continue to expect first gas into the facility in the second half of this year, and first LNG production from train one in the first half of 2027. to a 24-7 construction schedule at the site, a transition that has been contemplated in the EPC contracts and will not increase our EPC or total project costs. 24-7 formats to facilitate Bechtel making continued progress ahead of schedule. We're currently tracking ahead of the schedule reflected in our early volumes and cash flow guidance, giving us some buffer for the unexpected events during commissioning and startup of the trains while still achieving the production guidance we have provided. Supporting our goal of increasing our capacity at the Rio Grande Energy Facility up to 60 million tons per annum by advancing the development and permitting of trains 6 through 8. As we mentioned on our highlight slide, the feed study for train 6 is underway with Bechtel. Train 6 will have the same design as trains 1 through 5, and the feed study will support our regulatory filings with FERC and give us a general idea of where we expect to land on cost for train six. We currently expect train six to look a lot like train five from a project cost perspective, adjusted for inflation. A formal application was worked for train six and a third berth before the end of the second quarter of this year. The current administration's emphasis on U.S. energy dominance as a national security issue, including last week's determination that expanding LNG capacity is necessary under the Defense Production Act, is expected to be helpful for the development of U.S. LNG, and we expect permitting new capacity to be smoother and faster under the current administration than prior ones. Additionally, the D.C. Circuit Court's reversal, in our case in March 2025, and the Supreme Court seven-county case later last year, have set precedents that will go a long way in limiting the ability of certain groups to tie up permits in court over matters that have been appropriately analyzed by FERC in its environmental reviews. The permitting and regulatory framework for LNG infrastructure during the current administration appears to be taking less time, which is very encouraging. It gives us confidence that our future trains will receive approval faster than our first five trains. We believe it is possible that we could receive our permit for train six as early as mid-2027, which could set us up for an FID in the second half of 27, if we can also sufficiently commercialize and finance train six during that time frame. We expect that FID in the second half of 2027 would result in TRAIN-6 coming online as early as 2032. As I mentioned earlier, we've begun commercializing efforts for TRAIN-6, and we're seeing very strong demand from potential SPA counterparties. I believe that one of the main outcomes of the Iran conflict will be increased attractiveness of long-term US LNG volumes, and we'll discuss that more in a few minutes. The potential demand we are currently seeing for train six provides us with a sales pipeline that is larger than the capacity of train six and places us in a strong position for the subsequent commercialization of train seven and eight we're advancing the development of train seven and eight with a focus on determining the supporting infrastructure they will they will require and finalizing their location on the site train seven and eight will need a flood control mechanism such as a levee or wall as they'll be outside the main levee around the site and we're also evaluating potential tank and birth requirements We continue to have the goals of permitting these trains during the current administration and commercializing them while they are in the permitting process. We currently have full ownership of Trains 6-8, and we believe these trains could contribute significantly to future next-decade distributable cash flow across a wide range of financing scenarios. This year, as we advance permitting and commercialization of Trains 6, we're working on potential financing options with the goal of maximizing distributable cash flow on a per-share basis. Since our last call, global LNG market dynamics have shifted significantly as a result of the Iran conflict. Closure of the Strait of Hormuz during March and April pulled approximately 14 million tons of LNG supply out of the market, with capacity at Ras Lofan and Das Island shut-in. Each month of continued shut-in will result in the loss of an additional approximately 7 million tons, and we expect the production ramp-up at Ras Lofan will take weeks, if not months. Based on public announcements, the two damaged trains at Ross-Lafon totaling almost 13 million tons per annum of capacity are estimated to require between three and five years to repair. Also, it's estimated that expansion capacity in Qatar could be delayed by up to a year due to recent events. In total, a significant amount of LNG supply has been pulled out of the market between now and 2030, which we expect will tighten global balances. There's a lot we don't know today, including the full extent of the damage at Ross LaFont, exact timing for production to return to the market, and the ultimate impact of short-term demand destruction in price-sensitive markets, particularly in South and Southeast Asia. Before the conflict began, we expected the impending supply weight of LNG to spur extra-normal gas demand growth and additional gas infrastructure investments in developing markets over the next few years. Clearly, with less supply in the market currently, this will slow down. Longer term, we do not see a slowdown in demand for natural gas, and in particular, LNG. One very effective way for buyers around the world to acquire LNG at attractive prices is through long-term supply and U.S. LNG SPAs indexed to Henry Hub are particularly attractive due to the diversified prolific natural gas resource base in the U.S., which effectively shelters buyers from the spikes in the price of LNG and natural gas in other parts of the world. Henry Hub pricing has decreased since the Iranian conflict began, and customers with long-term contracts out of the U.S. that are indexed to Henry Hub are currently able to deliver into Europe and Asia at levels below $8 per MMVTU. Long-term LNG supplies out of the U.S. have been a buffer against market price shocks, not only during the current conflict, but also during the prior market spikes associated with the Russia-Ukraine war and weather-related seasonal demand spikes. Long-term U.S. LNG supplies have also been attractively priced relative to short-term supplies in tight market conditions like we have seen in the past two to three years. Since 2021, an example U.S. long-term SPA calculated at 115% of Henry Hub plus a fixed fee of $2.50 and shipping costs of approximately $2 would have delivered into Asia at an average of $8.83 per METU. The JKM spot price over the same period was over $17.50, around double the long-term price. Excluding the market spikes related to Russia-Ukraine in 2022, from 2023 to present, the example U.S. long-term SPA price averaged approximately $5 per MMBTU lower than the short-term LNG price. Long-term Henry Hub linked SPAs have also compared favorably to long-term LNG contracts linked to oil. Since 2021, long-term LNG contracts linked to Brent would have needed slopes below 11%, inclusive of any fixed adder, to beat the pricing of the most recent wave of long-term and rehab-linked LNG contracts. Historically, these Brent-linked LNG contracts have had slopes between 11% and 15%, plus a fixed adder. Before the conflict began, we received strong indications of demand for long-term supplies out of train six, and demand for long-term contracts is even higher today. With a prolific and diversified natural gas resource in the U.S. and the favorable geopolitical environment, buyers can have confidence in U.S. supplies from reliability, energy security, and economic standpoints. We expect buyers to increasingly value long-term contracts out of the U.S., which will spur additional capacity growth in the market, and with train six through eight under development, we're in a very good position to provide a meaningful amount of additional capacity to meet that demand. Now I'd like to turn it over to Mike to talk about our financial priorities. Mike?

Thanks, Matt, and thanks to everyone for joining us today through key construction, operational, and strategic priorities for 2026. Now, I will spend a few minutes on our financial priorities for the year, actively managing debt at the project level. Specifically, we plan to continue opportunistically refinancing portions of our project-level credit facilities in the debt capital markets. Today, we have over $9 billion of credit facility commitments for Phase 1, about $3.8 billion for Train 4, and roughly $3.6 billion for Train 5. Over time, we expect to refinance each of these bank facilities into a mix of bullet and amortizing debt securities. We expect to refinance the full-term loan balances before the commercial operation dates for trains 3, 4, and 5, respectively. Since Phase 1 FID, we have refinanced more than $1.85 billion of Phase 1 bank debt, and we expect to continue taking advantage of market opportunities this year. Importantly, this approach allows us to better manage project-level maturities by spreading them out over time and thoughtfully balancing bullet and amortizing structures. Our second financial priority is evaluating equity financing options for TRAIN 6. As Matt mentioned, we are targeting an FID in the second half of 2027, subject to achieving permitting, commercialization, and financing prerequisites. This timing comes before we expect to be generating meaningful operating cash flows that could fund our equity requirements for TRAIN 6, requiring us to look to other financing alternatives for this capital. We expect to contract a high percentage of TRAIN-6 capacity, which could support project-level bank facilities covering up to approximately 75% of total project costs. Maximizing project-level debt lowers the overall cost of capital and meaningfully reduces our equity requirements. based on current spa pricing early estimates of train six costs and the current interest rate environment we expect the project to be highly accretive to next decade's distributable cash flow as a result all else equal we will seek to both preserve our high economic interest in train six and select the equity funding options that are most accretive to our distributable cad flow on a per share basis to maximize value for our shareholders The FEMCO bank facility that will be used to fund a portion of our equity commitments for trains 4 and 5 remains a very attractive source of capital. It is priced at only about 150 basis points over our project-level bank facilities and provides significant flexibility through delayed draws and penalty-free prepayments. We believe additional FEMCO capacity will be available to help fund a portion of train 6's equity needs. Beyond that, we are actively evaluating a range of alternatives to fund the remaining TRAIN-6 equity requirements. We will continue working through these alternatives over the course of the year with a focus on finding the most accretive outcomes, and we expect to share more detail with you later this year as these options take shape. Today, we are reaffirming our early volume and cash flow guidance along with our steady state outlook. This slide provides a high level summary highlighting the key points. You can find more detailed assumptions and supporting slides in the investor presentation we posted earlier today. Let me start with a discussion of early volumes. We continue to project total LNG production of Roxyling 3,800 TBTU from early cargoes, beginning with startup of train one in 2027 and extending through first commercial delivery to our long-term SPA customers under train 5. Importantly, that total includes about 1,275 TBTU of LMG production in excess of what's currently contracted under long-term SPAs. As we discussed on our fourth quarter call, earlier this year, we sold forward more than 175 TBTU of those early volumes on an FOB basis. These sales carry fixed liquefaction fees and are expected to achieve cargo margins of more than $3 per room in BTU, calculated as the FOB LNG sales price less our expected feed gas and fuel costs. As a result, we have reduced our exposure to LNG market pricing on early Phase I volumes by roughly one-third. As Matt mentioned earlier, we expect Bechtel to deliver our trains ahead of the guaranteed substantial completion dates. As a result, the majority of the uncontracted volumes reflected in our early production guidance are expected to be produced after substantial completion and prior to DFCD under the SPAs for each train. As construction continues to progress, our confidence in these projections remains very strong. In fact, Bechtel is currently tracking modestly ahead of the schedule assumed in our guidance, which provides additional buffer and creates potential upside for early volumes that are not currently reflected in our projections. We expect the cash flow generated from sales of these early volumes to be used primarily to pay down a portion of FinCo and Super FinCo loans that support our equity commitments for trains 4 and 5. But our early cash flow outlook guidance remains unchanged. Under an assumed margin of $5 per MBTU on volumes in excess of our contracted SPAs, we project early production could generate approximately $2 billion in next decade's share of distributable cash flow at the Rio Grande LMG project level. At a $3 per MMBTU margin, we project approximately $1.2 billion of distributable cash flow. There is potential upside to both scenarios, driven by continued schedule strength, the pace of ramp-up to full production, the potential for production above nameplate capacity, and possible additional market price upside. Turning to leverage and capital structure, on our last call, we introduced a steady-state leverage target of three to three-and-a-half times next-decade-level debt-to-adjusted-eva We believe this target is appropriate given the long-dated, highly visible cash flows created by our highly contracted portfolio with high-quality, credit-worthy customers. In the $5 per MNVTU early volume margins scenario, we expect next decade level debt to fall within that target range as we move into steady state operations. In the $3 per MNVTU scenario, we would expect to pursue additional balance sheet optimization. In that case, we would consider contracting approximately an additional 2 million tons per annum under long-term SPAs across trains four, five. That would increase our five-train portfolio to roughly 90% contracted, allow us to maximize project-level debt, reduce overall equity requirements for both next decade and our partners, and ultimately reduce the amount we expect to draw under the FENCO loan, bringing next-decade-level debt back into our target range for steady state operations. Because we contributed the net proceeds from the super FNCO term loan into trains four and five at FID, we do not expect any additional next decade equity funding obligations through draws on the FNCO loan for those trains for at least the next two to three years. This gives us a long runway to determine the optimal level of long-term contracting, and as Matt mentioned, we are seeing very strong demand in the long-term contracting market today. Moving our discussion to steady-state operations, we are also reaffirming our steady-state guidance today. In our base case scenario, assuming $5 per MNBTU market margins, both for early volumes and during steady-state, we project annual next-decade distributable cash flow of approximately $500 million following DFCD for the Train 5 SPAs and prior to our economic interest flip for Trains 4 and 5 in the mid-2030s. After the flip, beginning in the mid-2030s, we project annual distributable cash flow of approximately $800 million. In our additional pricing scenario, assuming $3 per MNBTU margins on early volumes, $5 per MMBTU margins on steady state volumes, and an incremental 2MTPA of long-term SPAs across Trains 4 and 5, we project annual distributable cash flow of approximately $400 million prior to the economic interest flip for Trains 4 and 5, which we would expect to occur a couple of years later than in our base case. In this scenario, we project post-flip distributable cash flow of $500 million annually. As with our early volume outlook, there are potential upsides to our steady state guidance, including continued schedule improvement, ramp up timing, production above nameplate capacity, and ongoing operational efficiencies. Thank you again for joining us today.

With that, we'll open the call up for questions.

Thank you. We will now be conducting a question and answer session. Please limit yourselves to one question and one follow-up. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please while we poll for questions.

The first question is from Sunil Sibal from CPART Global Securities. please go ahead yeah hi good morning everybody and thanks for all the color so i wanted to start off on your request for additional work hours at the site uh i was curious you know is that kind of based or baked into your base construction schedule or does that kind of accelerate that from the base schedule yeah hi good morning thanks for the question the 24-7 contemplated in the original EPC.

It was an option, something that Bechtel could call on if they wanted to use it, and I think that's what they're doing. They want to maintain the current schedule, and they want the flexibility to utilize 24-7, and that's what we requested at FERC. How they end up utilizing and how many people they actually use is up to them, but I wanted to make sure it was clear to the market that this is not an incremental cost to us, this is something that was already baked into the EPC, and I think it's a positive sign that shows we have, you know, although we are already ahead of schedule, we hadn't even utilized all the potential capabilities of a 24-7 schedule to further accelerate. I'm very optimistic that that goal is going to remain ahead of schedule at this point, and I think by adding the 24-7 optionality, that gives us even more confidence.

Okay, thanks for that. And I think you mentioned DPA in your prepared comments. So I was curious, you know, what seems like, you know, that's primarily related to accelerated permitting or there are other kind of potential levers it gives you or other LNG developers in your view?

Sorry, I missed the first part of that, referencing what?

The Defense Production Act invocation.

Yeah, thanks. Yeah, I think we'll have to see exactly how this impacts the timing. But clearly, what we've seen recently has handled some of the current requirements, such as the pre-filing waiver for VV, which I view is very positive. That may only apply in certain circumstances. It's something that we're currently in discussions with FERC on, and we're waiting to hear additional guidance. But clearly, Trump's memorandum regarding the importance of LNG, along with other energy infrastructure in the U.S. to energy security during this period of time, especially with LNG for our allies, I think is a very positive sign and suggests that we're going to see these things move very rapidly relative to even what we've seen the past couple years under the first couple years of the Trump administration.

Got it. And then just a clarification on some of your comments. So I think you mentioned that as far as train six is concerned, construction cost is kind of in line with train five plus inflation. And then you also commented that based on where the supply demand for long-term contracts is, that market has strengthened. So I'm kind of curious, when you think about your project, say, train six, between these two factors kind of interplaying, do you see improving returns on investment on the project versus where things were, train five, for train five last year? And then, you know, how are you seeing in terms of the demand for additional cargoes, is that primarily Europe, Asia, any color on that in terms of, you know, your discussion so far?

Yeah, on the second part, you're talking about the long-term demand, or you're talking about for the excess cargoes, you said additional cargoes, you mean for long-term SPAs, or are you talking about for the short-term cargo sales?

Actually, both.

First off, the economics for train five were extremely good, and we expect the economics for train six to track closely to the economic outcome for train five, again, adjusted for inflation. And we still have to price up the EPC contract, and we likely won't do that until we're confident that FID is within months of that. And, you know, it's all dependent on how long we can get price validity, but it's tended to be about 90 days or so at most. But inflation, you know, we have to monitor its inflation, its interest rates are the two main factors that are going to impact the project costs. Inflation on the EPC, obviously interest rates on the financing costs and interest during construction. Both of those appear to be okay right now. But we'll have to see. We've had some early discussions with equipment providers for the main equipment. I've been very pleased, you know, very optimistic that, you know, we're not currently seeing the same sort of constraints that we saw back last year as far as timing. But, you know, we're not planning to FID until second half of next year. So a lot of things can happen between now and then. But at least in the interim, what we're seeing right now, I should say, things are tracking, I think, very positively. As far as the demand for the LNG, I think it's the same group that we saw for four and five. It's Asia, Middle East, not seeing as much added long-term contracting, but still a lot of interest from major intermediaries that sell into Europe and have markets into Europe. But Asia, and I think Middle East especially, look like they're going to be players in the next phase of RGLG's expansion.

In the shorter term, it's a combination of Europe and Asia. Got it.

Thanks for that, and I'll turn it over for others.

Thank you.

The next question is from Wade Suckey from Capital One. Please go ahead.

Good morning, everyone. Appreciate y'all taking my questions. Just thought I'd maybe just dovetail a little bit to this question, maybe expand a little bit on kind of cost inflation.

We're not going to maybe get word until next year, but labor running a little hot.

Maybe you could speak a little bit to the various equipment components, electrical, kind of just thinking about other Gulf Coast projects progressing. Now we have rebuilding, reconstruction, going, well, hopefully going abroad with all these damaged facilities. Just speak to those items as you see them today.

Inflation, it appears you've seen the most recent numbers that came out. Inflation appears to be heating up a little bit, but over time has been relatively modest. Again, we would expect the EPC cost to go up by at least inflation. Again, a large part of our EPC, since we're stick-built in the U.S., is going to be labor. Labor does tend to be a little bit higher than inflation, although this past year it wasn't much above inflation. We all monitor this closely, not only for the EPC, but for, you know, every year we have to, you know, look at our own employees' costs, and we want to be fair. So I think, at least right now, it's not a worry, a major worry, but we'll see how things progress over the year. As far as equipment, again, as I said, I've been pleasantly surprised with the feedback we've received from our major suppliers as far as the expected availability for equipment for train 6, 7, and 8, and the timing of when we'll be able to receive that equipment determined once we price everything up for the EPC contract. I do expect electrical equipment to continue to be in high demand, not just for LNG, but obviously for data center build out and power generation. So we'll see how that comes in. But I would expect that any sort of cost inflation that we're going to see will likely be offset by contracting, price contracting. And again, we're not seeing any sort of, we're not seeing the same sort of price increases that we saw after the pandemic, you know, prior to phase one, which was fairly substantial. And then as you recall, between phase one and train four and five, we had about a 10% increase and there was a two year spread there so it was running closer to five five percent per annum as opposed to the current inflation but that tracked pretty closely with what we were seeing in inflation and obviously um some of the equipment stuff you know got really really hot on turbine orders etc that that became the uh the constraints as far as schedule and the color there you kind of you kind of walked right into my next question matt um just to what extent these uh might kind of

influence, if at all, long-term SBA pricing. I always appreciate your broader thoughts or insight, whatever insight you could give us on what you're seeing out there with regard to kind of leading edge rates. That'd be great. Any color would be awesome.

Yeah, look, I think the market for LNG, $250 and $3 on a fixed fee basis, 150% in rehab, that range. I think it depends on, you know, the returns you're going to receive are going to be dependent on whether or not you're running a brownfield project or a greenfield project. The greenfield projects, I think, need higher contracting prices in order to get off the ground. If they go lower and compete with the brownfields like us, they have to get their upside through expansion. If they don't have a lot of expansion capability, I think it's a challenging market from an equity return perspective. As you guys have seen for our train 4 and 5, we tend to not be on the lower end of the market. We tend to be, I think, in the mid range of the market, kind of the true market price, if you look at it from a bid offer perspective.

And that's where I expect we will be, or close to that, for trains 6, 7, and 8.

The next question is from Craig Shear from 2E Brothers. Please go ahead.

Good morning. Thanks for taking the questions. Is your NatGas sourcing team fully in place now, and you've talked about hedging out some of the initial commissioning cargoes and that you expect $3 plus netbacks, net of your feedstock costs. Could you, by the end of the year, make any more formal announcements, not just on the sales side, but on the purchase side and what you're doing there?

Yeah, that's something we'll take under consideration, we've been active on the supply side for long term and been working on that. And I expect that we should be able to give an update as to what we've done on a long-term basis. In addition, some of our customers have to give us notice before the end of the year as to their willingness to sell us gas under long-term contract prices. So either later this year into the year, maybe in the first quarter, Craig, we can provide some guidance as to what we do on a short-term basis, a year or greater. I think that would be a good update. So thanks for the steer. As far as the team, yeah, together nicely. So we already had a gas supply team in place, but we're building out the short-term, you know, what I'll call the trading and optimization team that will be managing our gas supply for us, and we expect to have them definitely in-house completed before we have to start introducing gas into the facility, which will be later this year.

And, you know, you mentioned about this 24-7 construction that Bechtel officially kind of was the one who asked for it, and it's their discretion how to use it. But maybe you could just speak to their incentives by individual train or by individual FID. They may, depending on how well things are going overall, may not necessarily make more money or incentives to accelerate further versus where they're already tracking. But when you think about a, well, now already five-train project moving on to six and more, that perhaps even if they slightly increase their costs that you don't have to pay for, that their NPV building out six to eight trains over time could be higher and that they're still incentivized to maximize this under most conditions. Could you opine on that?

I think what I'd say simply, Craig, is that without getting into the details of the commercial arrangement, which I don't believe we have disclosed, I would say a completion of each train prior to the guaranteed substantial completion and that there is value there that I think could more than compensate them for, you know, an increased labor cost if they choose to use it. I mean, we're nowhere at this point, and we've already said and guided that, you know, we're nowhere near that guaranteed substantial completion date as far as the delivery of the trains. But, you know, they want to make sure that they achieve prior to guaranteed substantial completion because if they went past it, which, again, we're nowhere in this realm, there are key pole mechanisms and damages. So there's a bunch of different incentives for them to ensure that they deliver the trains, more incentives for them to deliver them ahead of you.

The last question is from Alexander Bidwell from Weber Research. Please go ahead.

Appreciate the time. Just wanted to, I guess, piggyback off some of the prior questions around Phase I construction. With the project tracking ahead of schedule, could you walk us through the path to maintaining that momentum, as well as any avenues that could further accelerate the project schedule?

Yeah, I think it's, you know, importantly, it's execution. We don't currently have any concerns about equipment and supply chain. That appears to be going very well. um we haven't seen any major impact associated with the conflict in iran uh impacting that which is good to see we'll continue to provide you updates uh each quarter you'll see the the progress from the standpoint of the construction uh you note that where our engineering is effectively complete procurement's effectively complete um for phase one or close to it so it really boils down to execution at the site and and building it again farther out in the future but you know you should expect to start seeing steel you know foundations being finished up this year and hopefully steel erecting at the trains we've already talked about the pilings for tank three I hope to see that progress for train four as well this year but you know I think it really boils down to execution. There's really, there's not one thing that we're specifically looking for. Construction is just, you know, ongoing, continuing to do and execute what Bechtel has been able to do so far. The next phase, though, I think is of equal importance, and that is the commissioning phase. You'll see gas being introduced in the facility this year. You should expect to see that. We'll be working on the warm side of the facility there. We'll be working on the flares. We'll be working on the gas processing side of it. The cold side, you shouldn't expect to see that until next year. Start running compressor and then start hopefully producing LNG, as we've said, in the first half of 2027. We haven't provided any specificity on which month that's going to be. I hope to be able to provide some additional guidance on that later this year. as we continue to progress with Bechtel and we get a better indication of when that's going to occur. And then, of course, once we get through the commissioning process, which I think I've told the market that we're doing with Bechtel, our operations team is seconded into Bechtel for the commissioning so that we have a seamless handover at substantial completion. Our team will have already worked on operating the facility during the commissioning with Bechtel, which we think is best practice. That should happen. That will happen in substantial completion, which, again, is tracking ahead of guaranteed substantial completion, which currently I think we've guided is the fourth quarter of next year. So, those are the key components. You know, we've been very, we believe and continue to try to be conservative in our guidance to the market because this is our first train um you know we are we've been around the block on this and other projects we we know how these things work um so far everything's gone extremely well we would anticipate based on how well bettel has done building the facility uh that we would expect the commissioning and handover to go extremely well also but um we're not planning for the best hoping for the best. We're going to plan for expected disruptions, as you typically see when you're starting a facility, especially a new one. We'll learn lessons from that. And then we would expect trains two and three to go even smoother because we'll learn from train one commissioning and startup. So I think these are the key components. Again, we will continue to update the market as we can with more details on when that facility is going to – when train one is going to start up, when we expect to produce first LNG, and when we expect to load our first cargo. And then the spread of timing between train one and train two, train two, and train three.

All right. Appreciate the color.

And then just, I guess, real quick on the shipping side, I was wondering if you could provide any additional color on your plans around shipping capacity? I understand you guys have some vessels set to be chartered in, but is there any plans to expand or add additional vessels to handle the merchant book?

Yeah, we have five vessels under charter, three long-term charters that are utilized for our Guangdong DES deal. We've chartered those from DynaGas. There are three new vessels. In fact, the first one just sailed yesterday from the Hyundai shipyard. I was there on Tuesday and took a tour of the vessel. It's a phenomenal piece of kit that Hyundai has built for DynaGas and DynaGas has designed. We have two more of those coming this year. And then we have two more vessels that we've sub-chartered. All these will be used for our commissioning process for train one, and then we'll start utilizing those larger ships that we have being built for us to deliver to our long-term market in China. We will like a DES-type business for our excess cargoes. We believe that being able to do a deliberate ship business for our excess volumes provides additional flexibility and optionality and should increase the value. So we do anticipate chartering more shifts on a short-term basis for phase one volumes above the firm volumes that we've already sold. And then for train four and five, we are looking at additional capacity potentially on a longer term basis due to the fact that we currently, as you know, haven't sold all of our firm capacity out of those trains. However, as Mike mentioned in his comments, should we decide to sell more of that capacity, you know, a year or two from now, depending on how the short-term market goes, that may reduce how much capacity we would need under a longer-term basis. So, we're going to be very mindful of that and make sure that we don't over-contract capacity before we need it. But we will be chartering more shifts, you know, simply put.

All righty. Thank you. Appreciate the color and I'll turn it back over. Thank you.

That concludes our call today. Thank you for joining and for your interest in next decade.