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Chilean renewables firm permitting two massive hydrogen export projects

A Chilean renewables developer plans to take on its first equity partners following permitting for two large hydrogen projects in southern Peru and northern Chile and anticipates needing strategic advice to do so.

Large capital requirements in the hydrogen space will likely compel Verano Energy to take on the first equity partner, or partners, in its 11-year history, CEO Dylan Rudney said on the sidelines of the World Hydrogen Summit in Rotterdam.

To date the company, based in Santiago, has connected more than 45 renewable energy plants to the grid and has a pipeline of 3,000 MW of new pv solar. The hydrogen projects are in the permitting stage with land secured.

A 5 GW project is planned in southern Peru and the company is eyeing another location in northern Chile to produce up to 20 GW, Rudney said.

“We’re just starting,” Rudney said, noting that the company is owned entirely by himself and his co-founding partner. They plan to invest in the projects themselves up to FID but will have to take on strategic equity investment along with project finance to build the facilities.

“The capital comes with the offtake,” he said, noting that the offtake environment is challenging. The vision is to produce ammonia for export to Europe.

The first phases of each project will require some $3bn of capital, he said. The first phase is the most expensive, Rudney said, as it covers most of the capex; additional phases typically focus on renewables and electrolysis buildout and upscaling output.

The Peru project should reach FID in 1Q25, Rudney said. The Chile project will come later, in 2027.

The developer has worked with Chilean firm Hudson Partners in the past and is close to mandating another advisor, Rudney said. Moving forward the company is open to establishing new relationships.

To date Verano has raised about $1bn in committed capital and deployed about half of that, Rudney said.

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Heliogen rejects cash offer from Continuum Renewables

An offer to acquire all of the outstanding shares of common stock of Heliogen for cash consideration of $0.40 per share was rejected by the company’s board of directors.

Heliogen has rejected the unsolicited, non-binding proposal it received from Continuum Renewables to acquire all its outstanding shares of common stock for $0.40 per share, according to a news release.

“After careful consideration and consultation with legal and financial advisors, the Board concluded that the non-binding proposal substantially undervalues Heliogen,” the release states. “In fact, the proposal would result in an implied equity value for Heliogen common stockholders that is materially below Heliogen’s available liquidity.”

The company’s board concluded that the proposal is subject to material contingencies, including CRI obtaining financing, the release states

“The Board remains fully committed to Heliogen’s management team and its strategic priorities of increasing sales, installing commercial projects and improving the Company’s financial position,” Julie Kane, chair of the board, said in the release. “We strongly believe that our new leadership’s execution of this dynamic plan is the best way to drive sustainable long-term value creation for all stockholders and is a superior path compared to CRI’s opportunistic proposal.”

Late last year Heliogen received notice from the New York Stock Exchange that the average closing price of its common stock over the prior consecutive 30 trading-day period was below $1.00 per share, which is the minimum average share price for continued listing on the NYSE. The company’s stock was trading at $0.29 at close of business on Monday.

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Southwest Airlines to offtake SAF from USA BioEnergy facility

Southwest plans to begin purchasing SAF from USA BioEnergy’s facility near Bon Wier, Texas, as early as 2028.

Southwest Airlines Co. has reached an offtake agreement with USA BioEnergy for up to 680 million gallons of neat sustainable aviation fuel (SAF), according to a news release.

Over the term of the 20-year agreement, once blended with conventional jet fuel, the SAF could produce the equivalent of 2.59 billion gallons of net-zero1 fuel and avoid 30 million metric tons of CO2. 

Southwest plans to begin purchasing SAF from USA BioEnergy’s facility near Bon Wier, Texas, as early as 2028. Additionally, as part of the offtake agreement, Southwest and USA BioEnergy have established a long-term strategic relationship offering Southwest the opportunity to purchase up to another projected 180 million gallons of SAF per year from future planned production facilities.

“This offtake agreement with USA BioEnergy marks important progress in the development of our SAF portfolio and furthers our goal to replace 10 percent of our total jet fuel consumption with SAF by 2030,” said Michael AuBuchon, managing director Fuel Strategy and Management at Southwest Airlines. “We look forward to the opportunity to grow our strategic relationship with USA BioEnergy and potentially purchase more SAF from them in the future.”

“Our agreement with Southwest Airlines is a perfect fit because it aligns Southwest’s goal of reaching net zero carbon emissions by 2050 and USA BioEnergy’s goal of becoming the leading producer of carbon-negative fuel,” said David Prom, chairman of the board, co-founder of USA BioEnergy. “USA BioEnergy is excited to work with Southwest on this initial project and, potentially, future sites we may add in our pipeline.”

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RNG, SAF and biomass projects backed by Canadian government

Public funding to three companies is meant to aid development of six separate RNG, SAF and woody biomass-to-electricity projects across the country, including two in the Niagara region.

The federal government of Canada will invest CAD $15m to support six clean fuels projects across the country, including CAD $10m for two projects in the Niagara region, according to a news release

The federal investments include:

  • $4.6 million to StormFisher Hydrogen to support a front-end engineering (FEED) study for a renewable natural gas (RNG) production facility at BMI’s Multimodal Hub in Thorold, Ontario.
    • Upon the completion of the FEED study in the summer of 2025 and construction of the planned CAD $200m production facility in 2027, StormFisher Hydrogen will combine renewable electricity from Ontario’s clean grid along with biogenic CO2 emissions from local industry to produce 1.25m gigajoules of RNG.
    • The project will support the decarbonization of the Canadian natural gas system and anchor a hydrogen hub in Thorold that will help attract other clean energy and technology businesses to the Niagara region.
  • More than CAD $5m to CHAR Technologies to support FEED studies that will enable CHAR to replicate their first-of-its-kind woody-biomass-to-renewable-energy facility in Thorold, Ontario in other parts of Canada.
    • Supported by an existing investment of $5 million from NRCan, CHAR is finalizing its construction of its clean fuels production facility at BMI’s Multimodal Hub in Thorold, which will convert woody biomass to renewable energy like RNG and biocarbon. The new NRCan funding announced today will enable CHAR Technologies to replicate this work at four new facilities in Kirkland Lake, Ontario; Drayton Valley, Alberta; and Saint Félicien and La Salle, Quebec and create a distributed network of low-carbon fuels production facilities across three provinces in Canada.
    • Taken together, the Thorold, Ontario, project — which is expected to reach commercial production this year — and the four other clean fuel production facilities in Kirkland Lake, Ontario, Quebec; and Alberta – which are expected to come online in the following two years — will maximize the value of underutilized waste wood resources and help decarbonize Canada’s steel and mining industries, and Canadian gas utilities.
  • CAD $5m to support Azure Sustainable Fuels Corp. in delivering a FEED study to support the construction and operation of a sustainable aviation fuels (SAF) production facility in Port Colborne, Ontario.
    • If the project reaches a positive Final Investment Decision (FID), following the completion of the FEED study, it is expected that the Azure’s SAF project would support approximately 1,500 construction jobs and 150 full time jobs during operations in Port Colborne, Ontario.
    • The FEED study is expected to be completed in by the end of 2024 and the construction of the planned facility would be commenced immediately following a positive FID.  The proposed project will be located on the north end of Port Colborne, Ontario, along the Welland Canal — a strategic location that will provide immediate access to local and global markets.
    • The planned processing facility in Port Colborne will leverage Canada’s agricultural sector to produce SAF that will meet the growing demand to help reduce emissions from the aviation sector.  Azure’s proposed project in Port Colbourne is one of three projects that Azure is progressing in Canada, with support from the federal government.

“We are leveraging Canada’s innovative clean tech companies and abundant range of feedstocks — including forest byproducts, agricultural crops and our low-emitting electricity grid — to grow Canada’s domestic production of clean fuels across the economy,” the release states.

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NanoScent seeking new investor to complete blended funding round

NanoScent is seeking a new investor to satisfy the contingencies of a combined EUR 8m investment from existing investors and the European Innovation Council.

NanoScent, an Israel-based technology firm, is seeking a new investor to help solidify an equity investment from the European Innovation Council, CEO Oren Gavriely said in an interview.

To satisfy the contingencies of a combined EUR 8m investment from existing investors and the EIC, NanoScent must bring on a new investor at EUR 2m, Gavriely said.

The ideal investor will have complementary capabilities that can ramp up the revenue stream, Gavriely added. Producers and suppliers of gasses and chemicals for industrial use would make sense.

The money will be used to further develop the proprietary VOCID Purity in-line sensor controller, which measures hydrogen quality by monitoring the cleanliness of gas lines. The technology is oriented towards producers and end-users like fuel cell stations, who will be responsible for the integrity of the hydrogen. The product will be rolled out at the end of 1Q23.

Gavriely said the company has several customers for the technology in the pipeline, declining to say who they are.

NanoScent, founded five years ago, has raised USD 10m in equity to date, with another USD 10m in non-dilutive funding. The company’s largest outside investor is Sumitomo Chemical, which trades on the Tokyo Stock Exchange.

Control of the company is maintained by the founders, Gavriely said.

NanoScent has 20 employees, Gavriely said. So far the company has relied on the expertise of its board, which includes one former investment banker, for financial advisory services. That could change in the future as the company grows.

NanoScent uses Pearl Cohen for law services and EY for accounting.

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Storage solutions firm in the market for strategic capital

An early-stage provider of hydrogen storage technology has hired a UK-based financial advisor to raise capital for a pilot plant.

Hydrogen carrier technology firm H2Fuel is seeking to raise approximately $25m to build a pilot project, according to sources familiar with the company’s plans.

The Dutch-based company has mandated a UK-based financial advisor to engage potential investors, with capital needs in the $12.5m range of a $25m project cost, the sources added.

In an interview, H2Fuel CEO Peter Huisman said the firm is “location agnostic” in looking for a site for a pilot project, but would prefer the US. Europe and India are also possibilities.

“We are early stage, in our view,” Huisman said. “[An investor will] need to have a long-term view of the market.”

Huisman declined to say which bank his company has hired but referred to it as a “top five” institution.

H2Fuel’s process combines hydrogen to salt, forming an energy-dense solid compound that can be transported and stored in dry conditions without complex requirements. A patented energy release process requires no extra energy, Huisman said.

The company has talked with some large strategics but has been told they are too early, Huisman said. The company views the near-term capital opportunities as one for pension funds or a venture capital.

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Waste-to-hydrogen developer to close $100m capital raise this month

Raven SR’s C-round of financing is being run by two bulge-bracket banks, and the firm has received widespread interest from private equity and corporate strategics.

Raven SR, a US waste-to-hydrogen developer, is working on a $100m capital raise that’s expected to wrap up this month, according to four sources familiar with the matter.

Raven’s C-round of financing is being run by Barclays and Bank of America. The firm has received widespread interest from private equity and corporate strategics.

Raven CEO Matt Murdock said on the sidelines of the Hydrogen Americas event in Washington D.C. that he was hoping to have the raise done by Thanksgiving.

Headquartered in Wyoming with projects in California and Spain, the company uses a steam/CO2 reforming process that transforms municipal solid waste, organic waste and methane into clean fuels.

In August, 2021, Raven closed on a $20m strategic investment from Chevron U.S.A., ITOCHU Corporation, Hyzon Motors Inc. and Ascent Hydrogen Fund. Samsung Ventures made a strategic investment earlier this year, allowing the company to expand into the Asia-Pacific market.

The company has partnered with INNIO to use its Jenbacher engines to provide renewable power and heat to Raven SR’s first waste-to-hydrogen production facility at the Republic Services West Contra Costa Sanitary Landfill in Richmond, California.

Raven SR plans to bring the plant online in the first quarter of 2023, initially processing up to 99.9 tons of organic waste per day and producing up to 2,000 metric tons per year of hydrogen.

In Aragón, Spain, Raven SR is aiming to bring a second project online in 2023 that will produce 1,600 metric tons per year of renewable hydrogen from approximately 75 tons of organic solid waste per day.

Raven SR recently announced the election of Mark Gordon of Ascent Fund and Michael Hoban of Chevron New Energies to its Board of Directors.

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