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CleanBay Renewables signs LOI for SPAC takeover

The proposed transaction values CleanBay, a producer of RNG, green hydrogen and controlled-release fertilizer, at $330m.

CleanBay Renewables, a producer of RNG, green hydrogen and controlled-release fertilizer, has signed a letter of intent for a potential business combination with NASDAQ-listed SPAC BurTech Acquisition Corp., according to a news release.

Under the terms of the letter, CleanBay’s existing equity holders would convert 100% of their equity into the combined public company. The proposed transaction values CleanBay at $330m. The BurTech trust account currently holds approximately $294m in cash.

“BurTech expects to announce additional details regarding the proposed business combination when a definitive merger agreement is executed in the second quarter of 2023,” the release states.

CleanBay’s process converts agricultural byproducts into fertilizer. CleanBay’s Chief Executive Officer Donal Buckley said in the release that the company is pursuing new facility developments for that purpose.

“We are excited to partner with CleanBay and believe that access to capital markets will enable CleanBay to commercialize and scale its proprietary and patented processes,” BurTech Chairman and CEO Shahal Khan said in the release. “CleanBay’s ‘shovel-ready projects’ present an attractive investment opportunity for existing and future shareholders.”

The release also highlights Maryland and California state policies to assist in financing such plants and produce RNG, hydrogen and natural fertilizer on an industrial scale.

“With nine identified facilities and eight potential future facilities in the pipeline, we believe that CleanBay will become a significant player in the North American RNG and natural fertilizer market,” Khan said.

According to CleanBay’s management, at full capacity, each CleanBay bioconversion facility can recycle more than 150,000 tons of poultry litter annually. By repurposing a potential source of excess nutrients, each facility can generate more than 750,000 MMBtus of sustainable RNG, 100,000 tons of natural, controlled-release fertilizer, and up to an estimated 1,000,000 tons of CO2 equivalent carbon credits that can be available for monetization in global carbon markets.

As an alternative to renewable natural gas, the facilities can also produce clean hydrogen at an estimated rate of 20,000 tons per year. CleanBay has accumulated proprietary intellectual property covering its conversion process to include trade secrets, a U.S. patent and pending patent applications in the U.S. and Europe.

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Green hydrogen developer raises $250m from Generate Capital

Green hydrogen developer Ambient Fuels completed the capital raise to support its pipeline of projects.

Generate Capital, a leading sustainable infrastructure investment and operating company, has made an investment in Ambient Fuels, a pioneering developer that builds green hydrogen projects to support the decarbonization of heavy industries and transportation, according to a news release.

The agreement includes a commitment to fund up to $250m of green hydrogen infrastructure. The funding supports Ambient Fuels’ fast-growing pipeline of projects.

CEO Jacob Susman said in an interview earlier this year with ReSource that the company was in exclusivity with an investor.

Susman declined to name the private equity provider but said the backing will allow Ambient to develop several projects, as well as acquire projects from other developers. The deal was proceeding without the help of a financial advisor, he said at the time.

Ambient Fuels offers custom-engineered green hydrogen solutions, overseeing every step of execution—from project development and design to financing and construction—of its renewable hydrogen centers. The company’s technology-agnostic approach works with any renewable energy source to support decarbonization at scale. With experience across both conventional and renewable energy as well as industrial and chemical processes, the Ambient Fuels team offers deep development and technical expertise.

“Joining forces with a global sustainability leader such as Generate gives us access not only to the capital we need to grow our business but also to a trusted and strategic partner who is committed to our long-term success,” said Jacob Susman, chief executive officer of Ambient Fuels. “Our collaboration with Generate Capital supercharges our ability to meet the unique needs of our customers by delivering the green hydrogen facilities they require for their decarbonization efforts.”

“For the last decade, Generate Capital has been partnering with leading project developers and technology companies to de-risk, accelerate and scale innovative, sustainable infrastructure,” said Scott Jacobs, co-founder and chief executive officer of Generate Capital. “We are excited to work with the team at Ambient Fuels to deliver effective and cost-competitive solutions to emission-intensive sectors that have traditionally been considered hard to decarbonize.”

“Since SJF Ventures led the seed financing for Ambient Fuels in late 2021, the firm has developed a strong pipeline of green hydrogen projects,” said Dave Kirkpatrick, co-founder and managing director of SJF. “Generate has been extremely successful at scaling critical, sustainable infrastructure so we are delighted to partner with them to get all these projects built.”

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Phoenix Motor enters hydrogen fuel cell market

Phoenix Motor Inc has acquired hydrogen fuel cell manufacturing assets from Altergy Systems.

Phoenix Motor Inc. a manufacturer of all-electric, medium-duty vehicles, has acquired hydrogen fuel cell manufacturing assets, including an automated, robotic fuel cell assembly line, from Altergy Systems.

Phoenix will utilize the manufacturing facility to design and produce hydrogen fuel cells to power forklifts, hybrid buses, vans and trucks, and long-range, heavy-duty trucks, according to a press release.

Phoenix Motorcars CEO, Dr. Lance Zhou commented, “We are excited to further expand our operations with our entrance into the rapidly growing hydrogen fuel cell market. The acquisition of these manufacturing assets enables Phoenix to accelerate its development plans, and leverage the automated production capabilities of these facilities, as we transition to mass production of hydrogen fuel cells for the burgeoning EV market in the coming quarters. In addition, the Inflation Reduction Act, also known as the U.S. climate bill, which was signed into law this week, should provide tremendous incentives, opportunities and market stability for us to grow this important clean energy power source. We are currently integrating the acquired assets and facility into our company and look forward to providing regular updates as we achieve important milestones in the hydrogen fuel cell business.”

The acquired manufacturing facility, located in Folsom, CA, has the capability to produce a fuel cell every 30 seconds on its advanced, robotic fuel cell assembly line. With the ability to produce fuel cells in high volumes, using off-the-shelf materials, stamped and molded fabrication, and robotic automated assembly equipment, Phoenix Motorcars plans to raise production at the Folsom facility in the quarters ahead.

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HTEC to receive B.C. funding for hydrogen trucking pilot

HTEC will buy, test and demonstrate hydrogen-powered trucks for fleet operators throughout B.C.

HTEC is set to receive $16.5m in funding from British Columbia for a pilot program that uses hydrogen to power commercial trucking.

Under the pilot, B.C.-based hydrogen-energy company HTEC will procure six different heavy-duty fuel-cell trucks and complete upgrades to a hydrogen-fuelling station in Tsawwassen and a maintenance facility in Abbotsford.

The B.C. Pilot Hydrogen Truck Project aims to start the use of hydrogen in the commercial transportation sector, according to a news release.

Colin Armstrong, president and CEO of HTEC, said: “Through the Province’s significant investment in zero-emission trucks in B.C., and the simultaneous development of robust infrastructure to enhance their operations, this pilot project symbolizes a remarkable leap toward a sustainable future. It marks the first-ever deployment of heavy-duty hydrogen fuel-cell electric trucks for a diverse range of fleet operators in the province, a historic moment for the trucking industry. We applaud the provincial government for their vision and support, and we are delighted to be the wheels on the ground and driving force behind this groundbreaking project.”

HTEC designs, builds and operates hydrogen production facilities, infrastructure and supply.

HTEC will buy, test and demonstrate the hydrogen-powered trucks for fleet operators throughout B.C. The project also brings together Canada’s world-leading hydrogen and vehicle-technology companies. The Province’s funding for the pilot is being administered by the Innovative Clean Energy (ICE) Fund.

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Green hydrogen developer in active discussions for California FID this year

A green hydrogen developer is in active discussions with counterparties as it pursues a final investment decision for its first project.

Houston-based green hydrogen developer Element Resources is in active discussions to reach FID this year on its first green hydrogen project slated for Lancaster, California.

The company had engaged Houlihan Lokey in recent months to lead a capital raise for the project, according to two sources familiar with the matter. The Houlihan mandate had involved raising non-dilutive debt, a process that is believed to have been shelved, said one of the sources.

“We are steadily working our way to an FID this year and are pulling together all parts of the project,” Element CFO Avery Barnebey said via email in response to inquiries. He declined to comment further.

A Houlihan representative did not respond to an email seeking comment.

The Lancaster facility, which is targeted to begin commercial operations in early 2025, will be built on 1,165 acres and consist of 135 MW of solar-powered electrolysis capacity, according to the company’s website. At full capacity, the 18,750 mt per annum of hydrogen produced by the facility will serve the growing demand for clean mobility fuels as well as clean energy for manufacturing.

Element is led by founder and CEO Steve Meheen, an oil & gas industry veteran. Barnebey is a former director of corporate development at California Resources Corporation.

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Exclusive: Hydrogen adoption and production firm prepping capital raise

A decarbonization services provider is in development on multiple utility-owned hydrogen adoption projects in the Northeast, Texas and Georgia and is preparing to launch a capital raise in 3Q24.

Celadyne, a Chicago-based decarbonization and hydrogen solutions company, will launch a Series A this year as it continues its role in the development of several utility-owned hydrogen adoption projects in the US, founder and CEO Gary Ong told ReSource.

A $20m to $30m capital raise will likely launch in 3Q24, Ong said. The company is relying on existing investors from its recent seed round to advise, and the amount could change based on grants.

While the $4.5m seed round allowed the company to focus on transportation mobility, the Series A will be used to do more work on hydrogen production, so the company will be looking for strategics in oil and gas, renewable energy, and utilities.

DLA Piper is the company’s legal advisor, Ong said.

Celadyne has a contract signed with a utility in the Northeast for a small electrolysis demonstration and, following that, a multimillion-dollar project. Discussions on how to finance that latter project are underway.

Additional electrolysis projects in Texas and Georgia are in later discussions, while less mature deals are taking shape with a nuclear customer in Illinois and another project in Southern California, Ong said.

Fuel cell customers (typically OEMs that use hydrogen) to which Celadyne ships equipment are clustered mostly in Vancouver, Michigan and California.

Meanwhile, Celadyne has generated revenues from military contracts of about $1m, Ong said, a source of non-recurring revenue that has prodded the company to look for a fuel cell integration partner specific to the defense application.

‘Blocking hydrogen’

The company, founded in 2019, is focused on solving for the demand and supply issues for which the fledgling US hydrogen market is notorious. Thus, it is split-focused between hydrogen adoption and production.

Celadyne has developed a nanoparticle coating that can be applied to existing fuel cell and electrolyzer membranes.

On the heavy-duty side, such as diesel generators or back-up power, the company improves durability of engines between 3X and 5X, Ong said.

On the electrolysis side, the technology improves rote efficiency by 15%. In production, Celadyne is looking for pilot projects and verification studies.

“We’re very good at blocking hydrogen,” he said. “In a fuel cell or electrolyzer, when you have hydrogen on one side and oxygen on the other side, you need something to make sure the hydrogen never sees the oxygen,” noting that it improves safety, reduces side reaction chemistry and improves efficiency.

Hydrogen adoption now will lead to green proliferation later should the economics prove out, according to Ong. If not, blue hydrogen and other decarbonized sources will still pave the way to climate stability.

The only negative for that is the apparent cost-floor for blue hydrogen in fuel cell technologies, Ong said, as carbon capture can only be so cost efficient.

“So, if the price floor is say, $3.25 or $3.50 per kg, it doesn’t mean that you cannot use it for things like transportation, it just means that it might be hard to use it for things like shipping, where the fuel just has to be cheaper,” Ong said.

Three companies

Celadyne is split into three focus applications: defense, materials, and production. If only one of those wings works, Ong said he could see selling to a strategic at some point.

“If any of those things work out, we ought to become a billion-dollar company,” he said.

If all three work out, Ong will likely seek to do an IPO.

An acquisition could be driven by an acquiror that can help Celadyne commercialize its products faster, he said.

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Denver green ammonia firm prepping series C capital raise

A green ammonia developer and technology provider is laying the groundwork for a series C capital raise later this year, and still deliberating on a site for its first project.

Starfire Energy, a Denver-based green ammonia producer, is wrapping up a series B capital raise and laying the groundwork for a series C later this year, CEO Joe Beach said in an interview.

The company completed a $6.5m series A in 2021 and finished a $24m series B last year. Investors include Samsung Ventures, AP Ventures, Çalık Enerji, Chevron Technology Ventures, Fund for Sustainability and Energy, IHI Corporation, Mitsubishi Heavy Industries, Osaka Gas USA, Pavilion Capital and the Rockies Venture Club.

Beach declined to state a target figure for the upcoming raise. The firm has not used a financial advisor to date.

Starfire is currently deliberating on locations for its first production facility to come online in 2026, Beach said. Colorado is a primary contender due to ammonia demand, while the Great Plains offer abundant wind energy.

The firm’s strategy is to use renewable energy and surplus nuclear power from utilities to create ammonia from hydrogen with no storage component, eliminating the problems associated with hydrogen storage and transportation.

Targeted offtake industries include agriculture, maritime shipping and peaking power fuel consumption.

“The demand is global,” Beach said, stating that he expects about 150 leads to convert to MOUs. “We get inbound interest every week.”

For future capital raising, Beach said the company could take on purely financial investors, as it already has a long list of strategic investors.

“The expectation is we will wind up with manufacturing plants around the world,” Beach said.

The “new petroleum”

Many hydrogen production projects have been announced worldwide in the last year.

Beach said he expects many of those to transition into ammonia production projects, as ammonia is much easier to export.

Now, Starfire is working on developing its ammonia cracking technology, which converts ammonia into an ammonia/hydrogen blend at the point of use for chemical processes. The final product form in that process is 70% ammonia, 22.5% hydrogen and 7.5% nitrogen – all free of emissions.

The company is using proceeds of its series B capital raise to develop its Rapid Ramp and Prometheus Fire systems. Rapid Ramp uses a modular system design for the production of green ammonia using air, water, and renewable energy as the sole inputs. Prometheus Fire is an advanced cracking system that converts ammonia into hydrogen, operating at lower temperatures than other crackers and creating cost-effective ammonia-hydrogen blends that can replace natural gas.

The advantage to using this technology is that it makes the export of a hydrogen product financially feasible, Beach said.

“You should see ammonia becoming the new petroleum,” he said of the global industry. Ammonia can be deployed internationally like oil and provide the dependability of coal.

Eventually Starfire will undergo a financial exit, Beach said. Likely that will mean an acquisition, but an IPO is also on the table.

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