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Gevo finalizes agreement with Zero6 for South Dakota H2 production

The Dakota Renewable Hydrogen Project will be an integral part of Gevo’s Net-Zero 1 renewable hydrocarbon plant that is under development.

Gevo, the Colorado-based producer of liquid hydrocarbons and renewable chemicals, has finalized a Hydrogen Development Services Agreement with Zero6 Energy (formerly Juhl Energy) for the development of a 20 MW hydrogen production facility in Lake Preston, South Dakota, according to a news release.

Cummins will supply the electrolyzer technology. The facility, known as the Dakota Renewable Hydrogen Project, will be an integral part of Gevo’s Net-Zero 1 renewable hydrocarbon plant (NZ1) that is under development.

“In addition to the utilization of the proven Cummins electrolyzer technology to produce green hydrogen, a portion of our electricity needs will be supplied by the Kingsbury County Wind Fuel wind farm,” Clay Norrbom, President of Zero6 Energy, said in the release.

More than 80% of the DRH hydrogen production capacity will be directly piped to the Gevo NZ1 plant to be used in the hydrocarbon refining process. The DRH will be located on the NZ1 plant property under a long-term lease agreement from Gevo.

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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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Nikola names new CFO

Nikola has named Anastisiya Pasterick as its new CFO. She replaces outgoing CFO Kim J. Brady, who is retiring.

Nikola Corporation, a global supplier of zero-emissions transportation and energy supply and infrastructure solutions, today announced that CFO Kim J. Brady will retire as effective April 7, 2023, according to a news release.

Anastasiya “Stasy” Pasterick, who is currently serving as Nikola’s vice president, corporate controller, will succeed Brady as the company’s new CFO. Brady will remain employed with Nikola through April 28, 2023, as a non-executive officer in an advisory capacity to support the transition.

As CFO, Pasterick will be responsible for leading Nikola’s finance and accounting team, including investor relations, strategic finance, and treasury.

Pasterick started her career at KPMG LLP where she worked in audit for seven years, serving a diverse portfolio of clients in the automotive and technology sectors from pre-revenue start-ups to global multi-billion-dollar corporations, according to the release. Prior to joining Nikola in 2019, Pasterick held several financial leadership positions at OEM manufacturing firms including Director of Accounting Operations at Erickson, Inc., and Corporate Controller at nLIGHT, Inc., where she led all financial aspects of the company’s IPO.

At Nikola, Pasterick was key in executing the organization’s SPAC merger in 2020 and has been responsible for the overall financial operations of the company including accounting, reporting, transactional finance, and manufacturing finance. She has established Nikola’s accounting and reporting infrastructure as a new public company and has been instrumental in scaling the organization’s financial operations through entering commercial production.

“Stasy’s proven financial acumen and attention to detail are the capabilities the company needs now as we build on the momentum surrounding the unveiling of our new energy brand, HYLA, the commercialization of our Class 8 battery-electric truck, and the pending production of our Class 8 hydrogen fuel cell vehicle,” said Michael Lohscheller, Nikola Corporation president and CEO. “We are grateful to Kim for his leadership and dedication to the company for the past five years. He led the organization’s early rounds of funding and was instrumental in taking the company public and shaping its strategy. We sincerely wish him all the very best as he embarks on a new and exciting chapter in his life.”

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JERA Americas appoints chief commercial officer

JERA Americas has appointed James Tinsley as CCO. He joins from Calpine.

ERA Americas, the Houston-based subsidiary of global energy leader JERA, has appointed James Tinsley as its new Chief Commercial Officer (CCO), according to a news release.

Tinsley joins JERA Americas from his position as vice president, Natural Gas Supply and Trading for Calpine Energy Services.

In his new role, Tinsley will be responsible for all commercial functions for the Company including overseeing commercial development opportunities for existing assets and for future asset portfolios the company may acquire.

“We are glad to have James join us at a critical point in JERA Americas’ growth trajectory. Over the past two years we have scaled up the organization to where we now have a solidly performing core asset portfolio and supporting corporate infrastructure,” said Steven Winn, JERA Americas chief executive officer. “James will spearhead the next phase of growth—expanding our commercial organization’s capabilities in order to optimize our current portfolio and the new assets we intend to build or acquire.”

During his seven years with Calpine, Tinsley led a natural gas supply and trading team of more than 20 people, responsible for natural gas trading, scheduling, and supply for the largest fleet of natural gas power facilities in the United States. He also grew the company’s natural gas commercial activities through the acquisition of new transportation and storage assets in addition to negotiating LNG imports.

Tinsley’s tenure at Calpine built on his leadership roles in the Natural Gas Trading and Supply businesses of Hess Energy Marketing (later acquired by Direct Energy) and helped build the largest commercial/industrial natural gas marketer in the country. He also oversaw development and construction activities of two power projects. Tinsley started his career in natural gas and electricity with Pace Global Energy where he helped large industrial companies manage commodity risk, negotiate contracts and lower energy costs.

“JERA Americas is catalyzing the clean energy transition—bringing clean energy projects such as wind and solar in Texas, hydrogen blending to reduce CO2 emissions at natural gas plants and looking to repurpose existing infrastructure into clean energy centers that will maintain a reliable supply of energy as well as facilitating the integration of new offshore wind farms and battery storage in the northeast,” said Tinsley. “I am looking forward to joining the Company and helping to accelerate the rollout of these technologies.”

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Exclusive: Northeastern offshore wind sale kicks off

A major European energy firm has retained a banker and launched a process to sell a large portfolio of offshore wind developments in the northeastern US.

Ocean Wind I & II, Orsted’s offshore wind developments in New Jersey amounting to 2.5 GW of capacity, are for sale via an auction, according to two sources familiar with the matter.

Jefferies is the exclusive financial advisor on the sale, which is codenamed Project Hummer, the sources said. The process launched this month.

Denmark-based Orsted had previously halted development of Ocean Wind I and II as impairments on the projects climbed above $5bn. And the sale process comes amid the firm’s broader pullback from the offshore wind sector.

In an earnings call this month, Orsted CEO Mads Nipper said the company had plans to sell up to DKK 115bn (USD 16.6bn) in assets by 2030 as it accelerates divestments to boost its balance sheet.

Orsted also said it would withdraw from offshore wind markets in Norway, Spain and Portugal and cut its target for 2030 installed renewable capacity from 50 GW to 35 – 38 GW.

The company has a preference for a new owner acquiring 100% of both Ocean Wind leases and all associated development assets, the sources said.

Targeted COD for the two developments is 2029 and 2031, while estimated capex for each is USD 7.1bn (98 turbines) and USD 7.7bn (82 turbines), respectively.

New Jersey has accelerated offshore wind solicitation schedules and has recently awarded two contracts for 2.4 GW at $112.50/MWh and 1.3 GW at $131.00/MWh compared to the $98.10/MWh for Ocean Wind I and $84.03/MWh for Ocean Wind II awarded back in 2019 and 2021.

Orsted and Jefferies did not respond to requests for comment.

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California Resources pursuing pipeline of blue molecule projects

Through a subsidiary called Carbon TerraVault, the upstream oil and gas producer will approach carbon capture and blue molecule production investments on a project-level basis to help meet California’s lofty decarbonization goals.

Through its subsidiary Carbon TerraVault, California Resources Corporation will approach carbon capture and blue molecule production investments on a project-level basis to help meet California’s lofty decarbonization goals, Chief Sustainability Officer Chris Gould said in an interview.

Carbon TerraVault is differentiated by its nature as a CCS-as-a-service company, Gould said, as most CCS projects are owned by emitters themselves.

“We are bringing to market a solution to decarbonize other parts of the California economy,” Gould said, noting that hydrogen producers, power plants and steel and cement makers are among potential clients. “We are out across the state, working with emitters.”

Carbon TerraVault is self-mandated to return one billion tons of carbon back into the ground, first as a gas and then pressurized into liquid. Revenue comes from the federal 45Q incentive and the California LCFS and related tradeable market.

The company has a JV with Brookfield Renewable for the first 200 million tons. That JV recently formed a separate JV with Lone Cypress Energy Services for a planned blue hydrogen plant at the Elk Hills Field in Kern County.

Carbon TerraVault will provide permanent sequestration for 100,000 MTPA at the facility, and will receive an injection fee on a per ton basis, according to a December 7 presentation.

In hiring Carbon TerraVault to provide CCS as a service, LoneCypress also invited the company to invest in the production, Gould said. The JV has the right to participate in the blue hydrogen facility up to and including a majority equity stake, the presentation shows.

“You should expect to see over time as we do more and more of these that we’re going to have multiple models,” Gould said of these partnerships and financial structures. A typical model may emerge as the industry matures.

The company could repeat that effort for “many more” blue hydrogen projects in the state, Gould said. “Green [hydrogen] is a longer-term proposition that is going to be based on renewable buildout,” he said. “Blue is kind of here now.”

Target market

Carbon TerraVault estimates that California’s total CCS market opportunity is between 150 MMTPA – 210 MMTPA, and is in discussions for 8 MMTPA of CCS, of which 1 MMTPA is in advanced discussions, the presentation shows.

Through California Resources’ Elk Hills land position of 47,000 acres and CO2 sequestration reservoirs, the company could attract additional greenfield infrastructure projects like the Lone Cypress Hydrogen Project and create a Net Zero Industrial Park, according to the presentation.

In that vein, Gould noted the huge need for decarbonized ammonia in California’s central valley agriculture, which today is imported from abroad.

“There is a need for clean hydrogen in California and it is best if it is created in California,” Gould said.

The JV with Brookfield funds Carbon TerraVault’s storage needs, Gould said. Investments in the production processes, such as the deal with Lone Cypress, will likely require additional capital.

Project level financing is a “default assumption,” Gould said, though that’s not set in stone. The company is working with a financial advisor but Gould declined to name the firm.

The scale of California’s hydrogen ambitions is far beyond what any one company can do, Gould said.

“If you’re an advisor that is working with a developer likeLone Cypress that is considering locating in California, then I would say give us a ring,” Gould said. “We’re the ones who are going to be able to do the sequestration there.”

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US clean fuels producer prepping equity and debt raises

A Texas-based clean fuels producer is close to mandating an advisor for a platform equity raise. It has already tapped Goldman Sachs to help arrange a cap stack in the billions for a project in Oregon.

NXTClean Fuels, a Houston-based developer of clean fuels projects, is preparing a $50m to $100m platform equity raise in the near term and has large debt and equity needs for a pair of projects in Oregon, CEO Chris Efird said in an interview.

The company is close to engaging a new financial advisor for the raise, which will launch late this year or early next, Efird said.

Port Westward

Meanwhile, Goldman Sachs’ post-carbon group is retained for the capital stack on NXTClean’s flagship project at Port Westward, at the Port of Columbia County, Efird said. The $3bn CapEx (including EPC) project is fully permitted by the State of Oregon and is awaiting one federal Clean Water Act permit. An Environmental Impact Statement is expected this fall.

The project is dedicated to producing a split of renewable diesel and SAF, amounting to roughly 50,000 barrels per day total permitted capacity when fully operational.

FID is expected for roughly August 2024, he said. About 30 months from FID the plant will reach COD.

“What we’re most focused on right now is the true senior debt,” Efird said. On the equity side the company is engaged with strategic partners that have indicated interest in post-FID equity.

NXTClean has conversations ongoing with the Department of Energy’s Loan Programs Office, along with commercial project finance lenders.

Red Rock

In April NXTClean acquired what was the Red Rock Biofuel facility in Lakeview, Oregon. That woody biomass-to-SAF facility foreclosed after $425m in investment, following technical and financial issues brought on by the COVID 19 pandemic. NXTClean purchased the facility for $75m in preferred stock at auction on the courthouse steps.

GLC advisors was retained by lead bondholder Foundation Credit to advise on that process, Efird said.

Red Rock is being repurposed to produce carbon-negative RNG for the adjacent Tallgrass Ruby Pipeline, Efird said. The fully-permitted project has a significant amount of equipment already installed or on skids.

A first phase will require a spend of $100m to $150m. Some $50m of equity will augment a balance of debt, raised in part through USDA programming, Efird said. Cash flow from the first phase will help with the second phase, which will bring the capital needs of the facility up to as much as $400m.

Looking forward

Geographically, NXTClean will expand in the Pacific Northwest and British Columbia, Efird said.

Each of NXTClean’s two projects are held by a separate subsidiary. The company has a third subsidiary called GoLo Biomass that focuses on feedstock aggregation, Efird said. It engages with fish processors in Vietnam and used cooking oil suppliers in South Korea to augment supply from large companies.

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