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Developer files for permit to construct green ammonia facility near Corpus Christi

A developer has filed for a permit to construct an 800,000-tons-per-year facility near Corpus Christi, on which it expects a final investment decision in 2Q24.

Avina Clean Hydrogen has applied for a permit to construct a green ammonia facility in Robstown, Texas, near Corpus Christi.

An Avina subsidiary, Nueces Green Ammonia, LLC, filed for the permit in late December with the Texas Commision on Environmental Quality.

Nueces Green Ammonia is a proposed world-scale anhydrous ammonia facility with a production capacity of 800,000 metric tons per year.

The total expected capital investment for the project is $2.2bn, and a final investment decision is expected for 2Q24, according to the project website.

ReSource previously reported that Avina was auditioning bankers to raise debt and equity capital in support of its projects.

Avina did not immediately respond to a request for comment.

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National Petroleum Council calls for carbon price to advance hydrogen development

In a blockbuster report on the U.S. hydrogen industry, the NPC, an advisor to the Department of Energy, called for greater government action in order to meet ambitious net zero emissions targets by 2050.

The National Petroleum Council (NPC) is calling for a robust carbon pricing mechanism among a series of new measures for advancing the U.S. hydrogen economy.

As currently stated, policies for hydrogen are severely inadequate for the U.S. to meet net zero targets by 2050, a report by the NPC finds, and industry and lawmakers must implement a series of new policies and incentives in order to spur the massive capital investment required to develop a clean hydrogen economy.

The NPC, an oil and gas advisory group to the DOE, has been calling for a carbon price since 2011, and renewed those calls in recommending an explicit long-term carbon price as a cornerstone of a future policy framework.

“A long-term, effective, durable, and transparent price on carbon could phase in as shorter-term low-carbon energy funding and tax incentives are phased out to enable a smoother and more efficient market transition,” the report states. “Explicit carbon pricing in the form of a carbon tax or a GHG cap-and-trade program provide the most economically efficient climate policy.”

The NPC has some 200 members from the oil and gas industry, as well as electric companies, research groups and academic institutions. Industry participants that led individual chapters of the report include Chevron, McKinsey & Company, Air Liquide, Southern California Gas, ExxonMobil, and bp.

Phase in, phase out

The report recommends that the administration work with Congress to phase in an economy-wide price on carbon “well before the current incentives, such as 45V, expire.”

Additionally, the council recommends that, once the carbon price is established, “current implicit pricing incentives (e.g., 45V PTC, 45Q PTC) be phased out in such a way as to allow a long-term explicit pricing policy to be phased in to facilitate a smoother market transition and provide a more stable investment environment for low-carbon energy and hydrogen industry growth.”

Alongside carbon pricing, the report makes an additional 102 recommendations. Among them, the council advocates for increased federal and state policy support. This includes expanding incentives such as tax credits and grants, with particular emphasis on leveraging the 45V hydrogen production tax credit and the 45Q carbon capture tax credit to spur technological adoption and infrastructure development.

The NPC calls for the simplification of regulatory processes to speed up the deployment of hydrogen technologies. This recommendation focuses on harmonizing safety standards and expediting permitting processes to facilitate a smoother rollout of hydrogen infrastructure.

The report also highlights the need for enhanced RD&D efforts across the hydrogen value chain to drive technological advancements and reduce costs. It advocates for stronger collaboration between government and the private sector to foster innovation in hydrogen technologies.

Without these actions, significant differences in the projected capital investment required under two pivotal scenarios for hydrogen development would emerge, according to the study. Under the Stated Policies scenario, assuming existing policy frameworks, only $290m of investment is deployed into both blue and green hydrogen by 2050 in the U.S. In contrast, under a net zero scenario, capital investment is projected at approximately $1.9 trillion by 2050, $124bn for blue hydrogen and $1.78 trillion for green hydrogen.

source: National Petroleum Council
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Hydrogen tech firm looking for distribution partners with eye on Series B

A Florida-based hydrogen technology company is hoping to find strategic partners with distribution networks as part of its impending Series A capital raise, with an eye on a much larger Series B later.

BoMax Hydrogen, the Florida-based hydrogen production technology firm, is searching for strategic partners with distribution networks as part of its soon-to-launch Series A capital raise, CEO Chris Simuro said in an interview.

BoMax, founded in 2014 and headquartered in Orlando, will launch a $15m Series A on November 1, Simuro said. The company has hired Taylor DeJongh to run the process, as recently reported by ReSource.

Greenberg Traurig is the company’s law firm, Simuro said. They use a regional accountant in Florida.

Taylor DeJongh is looking for three to five investors to put in between $3m and $5m each. BoMax is in discussions with French container shipping company CMA-CGM as a potential investor, he said.

“We are truly searching for distribution partners,” Simuro said, adding that company doesn’t envision itself touching the end-use customer.

The Series A funds should provide up to 24 months of runway and expand the company’s manufacturing capacity, Simuro said. A follow-on Series B capital raise will likely be $100m or more.

BoMax has raised some $5m to date, including from state government aerospace economic development agency Space Florida.

Funds from the Series A will be used to make a beta prototype, scale operations at the company’s labs in Orlando and prepare for commercial production.

No electrolysis

The company touts a novel technology making hydrogen from visible light without the need for solar electrolysis, according to a pre-teaser marketing document seen by ReSource. An alpha prototype has been awarded by the US Department of Energy.

Requiring a larger footprint, electrolysis can ultimately produce 38 liters of hydrogen per hour per square meter, Simuro said. BoMax believes it can reach 50 liters per hour in six months time.

“It replicates how hydrogen is made in the natural world,” Simuro said. “In order to do this globally, we are going to need partners.”

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NET Power and Rice Acquisition garner additional $275m PIPE commitments

The original transaction in December concerns NET Power’s 300 MW Serial Number 1 project near Odessa, Texas.

ET Power and Rice Acquisition Corp. II have announced an additional $275m of PIPE commitments in connection with their proposed business combination, according to a news release.

Occidental has increased its commitment to the PIPE by $250m, bringing its total investment to $350m, while the Rice family has committed an additional $25m, bringing their total investment to $125m.

“We believe NET Power’s technology can accelerate emissions reductions in our existing operations and ultimately supply emissions-free power to the Direct Air Capture facilities and sequestration hubs we are developing, the release states.”

The new commitments bring the expected gross proceeds of the business combination to $845m for NET Power, consisting of approximately $345m from RONI’s trust account (assuming no redemptions), and approximately $500m from the PIPE raised entirely at $10 per share of common stock.

Assuming no RONI shareholders exercise their redemption rights, the combined company is expected to have a market capitalization in excess of $2bn.

“Since announcing the transaction in December 2022, NET Power has continued to make excellent progress towards commercialization of its utility-scale power plant, including FEED commencement on the Occidental-hosted Serial Number 1 (“SN1”) project near Odessa, Texas,” the release states. “In support of the plant, NET Power expects Occidental will be a key offtaker of the clean power generated by SN1.”

It is anticipated that Occidental will manage the transportation, storage, and utilization of the captured CO2 from SN1.

“We believe NET Power’s technology can accelerate emissions reductions in our existing operations and ultimately supply emissions-free power to the Direct Air Capture facilities and sequestration hubs we are developing,” Vicki Hollub, president and CEO of Occidental, said in the release.

Following this additional commitment, Occidental’s ownership stake in the combined company will increase to approximately 39%, assuming no redemptions.

NET Power expects $200m of net proceeds from the business combination and the PIPE to fully fund corporate operations through commercialization of SN1, which is expected to be operational in 2026.

The net proceeds above $200m are expected to support SN1 capital needs and future commercial origination efforts.

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Denbury to transport CO2 for Louisiana blue methanol project

A subsidiary of Denbury Inc. will transport and store CO2 for a planned blue methanol plant in Lake Charles, Louisiana.

Denbury Carbon Solutions has executed a 20-year definitive agreement to provide CO2 transportation and storage services to Lake Charles Methanol in association with that company’s planned 3.6 MMPTA blue methanol project, according to a press release.

LCM’s facility will be located along the Calcasieu River near Lake Charles, Louisiana, approximately 10 miles from Denbury’s Green Pipeline.

The facility is designed to utilize Topsoe’s SynCORTM technology to convert natural gas into hydrogen which will be synthesized into methanol while incorporating carbon capture and sequestration.

The process is anticipated to deliver more than 500 million kilograms of hydrogen per year as a feedstock to produce the 3.6 MMTPA of blue methanol.

LCM is finalizing its major permits to begin construction. The project is expected to reach a Final Investment Decision in 2023 with first production anticipated in 2027.

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Cutting the electricity out of electrolysis

Milwaukee-based start-up Advanced Ionics is seeking to commercialize an electrolyzer that cuts electricity needs for hydrogen production to as low as 30 kWh per kilogram.

Advanced Ionics is seeking to ramp manufacturing capacity and raise capital as it begins to commercialize an electrolyzer promising to reduce electricity needs, CEO Chad Mason said in an interview.

The Milwaukee-based company is working to demonstrate its low-cost electrolyzer technology through a partnership with the Repsol Foundation.

The technology will be tested locally, but could grow to include additional tests and, eventually, a commercial relationship with the Spain-based energy and petrochemical company.

Advanced Ionics is looking to move into a larger facility in Milwaukee to advance early-stage production of the electrolyzer, which uses steam from process and waste heat to reduce the amount of electricity required in electrolysis.

The company last year raised $4.2m in a seed round led by Clean Energy Ventures, with participation from SWAN Impact Network. It has also received financial support from Repsol and $500,000 from the DOE.

As it scales, Mason said, the company will also need to raise additional capital, but he declined further comment.

Going to market

The Repsol arrangement is part of the company’s early access program allowing potential end users to take a first look at the technology.

“Repsol is just the tip of the iceberg here,” Mason said. “We’re talking to some really amazing partners at some of the largest energy companies in the world. People who use hydrogen today and want to make it green immediately understand what we’re doing.”

Given the concentration of hydrogen use in petrochemicals and ammonia, Advanced Ionics is targeting these sectors for deployment of its electrolyzers to produce clean hydrogen, Mason added.

Mason noted that, as the traditional petrochemical industry dies off over time, it will be replaced by green materials and green fuels like sustainable aviation fuel and biofuels that require hydrogenation to be useable.

“You’ll see a bit of a replacement happening on the petrochemical side, towards a green chemical,” he said, adding that a third potential key market is green steel production using hydrogen.

Thermodynamically favored

The company’s Symbiotic electrolyzers use steam by tapping into excess heat from industrial settings, thereby lowering electricity needs for water splitting to 35 kWh per kg, with 30 kWh per kg possible. That compares to industry averages over 50 kWh per kg.

Advanced Ionics’ water vapor electrolyzer

“We set out to build an electrolyzer specifically that would operate at intermediate temperatures,” he said. “And that allows you to have the synergy with those processes, and the downstream effect is the most cost-effective hydrogen you can get.”

The resulting hydrogen could be available for less than $1 per kg – but, Mason notes, the underlying power price math assumes an abundance of cheap, clean power. The models are usually pricing in two cents per kWh, the availability of which, Mason added, is “extremely geographically dependent.”

“If you’re in Texas, you have a system with wind, solar, and some amount of clean energy grid back-up, it’s pretty attractive,” he said. “Or if you hook up to a hydroelectric facility in the Northwest or in the Quebec area.”

Mason added, “Electrolysis rides on the coattails of cheap, clean electricity. What we have under our control is to make sure we’re using as little electricity as possible.”

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Carbon capture OEM eyeing US for manufacturing plant

A Vancouver-based maker of carbon capture equipment is considering building a manufacturing plant in the US. Its number one target market: gray hydrogen producers.

Svante, a carbon capture original equipment manufacturer based in Vancouver, is eyeing the US as it seeks to expand its market presence across North America.

The company has raised sufficient capital to construct its first plant in Vancouver, where it will make specialized filters and contactor machines used in the carbon capture and removal processes, Svante CEO Claude Letourneau said in an interview.

Within several years, Svante is planning to build a second manufacturing facility in the United States, closer to where its customers are located and where CO2 can be monetized, Letourneau said.

Svante raised $318m last year in a series E fundraising round led by Chevron New Energies. It will spend approximately $100m to build the Vancouver facility.

Letourneau says the company’s principal target market in North America is existing gray hydrogen facilities that use steam methane reforming, of which there are around 1,000. The cost of adding carbon capture to existing SMR plants brings the cost of blue hydrogen from $1.50 per kilogram to around $2 per kilogram, according to Letourneau, compared to green hydrogen that will cost between $3 – $6 per kilogram with a similar carbon footprint.

“It’s a good solution,” he said.

Optimizing costs

As an original equipment manufacturer, Svante has partnerships with some of the largest EPC companies in the world for carbon capture projects: Kiewit in North America, Technip in Europe, and Samsung in Asia.

“When you have a technology that you want to take to market, you need to get the benefit of a close relationship with these EPC contractors if you want to deploy quickly and reduce costs,” he said.

He noted that the filters and contactors typically make up between 10% – 15% of the cost of a carbon capture plant, while the rest is in the balance of plant. Filters typically have a lifespan of three to five years, he said, allowing for additional recurring revenues for Svante after the initial installation.

Svante is working on five to six projects with Kiewit in North America that are in the pre-FEED and FEED stages, with FIDs expected by the end of next year. It is also working with Linde on a Department of Energy-sponsored pre-FEED carbon capture project for Linde’s Port Arthur gray hydrogen facility.

Additionally, Svante has a partnership with Swiss-based Climeworks for direct air carbon capture technologies.

“We want to be for carbon capture what GE Aerospace is for the jet engine industry,” he said, using an analogy to a market in which there are only several OEMs in a large, consolidated industry.

Target market

There are around 10,000 emitting plants globally that need carbon capture in order to decarbonize; meanwhile there are only 40 carbon capture facilities in operation, according to Letourneau. Svante’s Vancouver plant will be able to make equipment for around 10 plants per year, but eventually the company would like to scale up to between 50 – 100 plants per year with additional manufacturing capacity.

“This is a big problem we’re trying to solve here,” he said.

To build the second plant in the US, the company will explore using project finance debt and seek to take advantage of US government incentives for clean energy manufacturing. The recently enhanced carbon capture tax incentives – of $85 per ton of CO2 captured versus $50 previously – will also benefit Svante’s carbon-emitting customers.

In addition to gray hydrogen, the company is targeting carbon emissions from oil and gas refining as well as pulp and paper mills.

Use cases

Svante’s modular solid sorbent technology can be inserted to capture flue gas at the end of the refining process instead of inside the plant, offering fewer disruptions to existing systems. Svante then concentrates the CO2 into a pipeline grade for storage or industrial use.

“Nobody makes these filters in the world,” Letourneau continued, “so if I want to convince somebody to give Kiewit and ourselves a purchase order for $300m to build a 1 million-ton-per-year plant, they need to see that we have a manufacturing plant to make the filters, they need to see that we have the size of the contactor done at commercial size, and they need to see that we’ve done all the engineering studies to justify that this project can be monetized, economical, and the like.”

The company is sufficiently capitalized to advance the projects in its pipeline, and is focused on completing the Vancouver plant and garnering purchase orders in order to become profitable. A potential future exit could come in the form of an IPO or sale to a larger player, Letourneau said.

“We understand the market is quite buoyant and probably a few large companies are going to try to dominate, and they may decide they want to acquire a company like us, so an M&A is a possible exit in the next five years, depending on the conditions,” he said.

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