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M2X partners on gas-to-methanol-to-hydrogen pathway

M2X and Element 1 are pursuing a joint research and development program on the use of M2X's low-carbon methanol as a feedstock for point-of-use hydrogen production.

M2X Energy, a startup company with a proprietary process technology that converts stranded gas into low-carbon methanol, and Element 1 Corp, a global leader in advanced hydrogen generation systems for the fuel cell industry, are conducting a joint research and development program to explore the use of M2X low-carbon methanol as a feedstock for point-of-use hydrogen production.

Element 1 is demonstrating the viability of low-carbon methanol produced by M2X’s gas-to-methanol unit as a feedstock for its hydrogen generation unit, and subsequent conversion to electricity, according to a news release.

The process technologies developed by the two companies can unlock the potential for clean energy production in demanding locations, where power grids are overloaded, and operating conditions require adaptability and grid independence. After confirming that M2X’s low-carbon methanol is a suitable feedstock for Element 1’s methanol-to-hydrogen systems, methane-rich stranded gases that today are often flared or vented, may instead be harnessed for downstream stationary power applications, hydrogen refueling stations, and on-board generation for hydrogen-fueled road vehicles, trains, and maritime vessels.

Early testing of methanol produced by M2X Energy shows promising results for unlocking hydrogen as a cost-competitive and low-carbon chemical sourced from stranded gases. “M2X is excited about this collaboration with Element 1. Serving as a supplier of low-carbon methanol for Element 1’s process equipment demonstrates our product market fit and the value of M2X low-carbon methanol as an attractive, low-cost hydrogen carrier, especially during the energy transition,” commented Paul Yelvington, Chief Science Officer at M2X.

With details emerging on the implementation of production credits for hydrogen and clean fuels in the U.S.’s Inflation Reduction Act (e.g., 45V and 45Z), M2X Energy and Element 1 are well-positioned to provide an integrated pathway to cost-competitive, low-carbon hydrogen with greatly simplified logistics for production, transportation, and storage.

Dave Edlund, co-founder and CEO of Element 1 Corp, said, “Low-carbon methanol, such as that produced by the M2X process, offers the most economical and practical pathway to widespread adoption of grid-independent electricity production while maintaining a low-carbon footprint. We are pleased to be partnering with M2X Energy on this important demonstration.”

This cross-industry collaboration aligns with the strategic priorities announced at COP28 for reducing methane emissions and expanding the role of hydrogen as an alternative energy carrier. It lays the groundwork for future commercial partnerships for the supply of M2X Energy’s low-carbon methanol in deployed hydrogen generation equipment using the Element 1 technology.

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New Fortress Energy executives detail hydrogen project progress

New Fortress Energy executives detailed the amount of EBITDA they expect to generate — once fully operational — from three US green hydrogen projects under development.

Executives from New Fortress Energy believe the company will generate $150m of EBITDA from three green hydrogen projects when fully operational.

NFE’s ZeroPark I facility in Beaumont, Texas is the most advanced, having broken ground on construction after securing offtake for green hydrogen from OCI Global and contracting with Electric Hydrogen to install electrolyzers at the site.

The original design for the facility called for 100 MW of capacity or up to 50 tons per day of hydrogen production. The company is now increasing the scope of the facility to 200 MW or 100 tons per day, and expects to have the ability to turn on the facility next year with full operations entering 2025, NFE Managing Director Ken Nicholson said on an earnings call.

The company is pursuing two additional green hydrogen project developments, one in the Pacific Northwest and one in the Northeast that will start construction in the next six months.

“We have a fourth facility also on the Gulf Coast that we think is very interesting and we’re in advanced negotiations to secure that site,” Nicholson said.

The business segment, known as ZeroParks, will provide green hydrogen and hydrogen logistics terminals to customers in the energy, industrial and transportation sectors, he said. The terminals are focused on regional North American demand but are also on waterfront, allowing for expansion into exports to international markets.

“If all we do is build three parks in the Pacific Northwest, Northeast and down in Beaumont, this is a business that will generate $150m of EBITDA annually,” he said.

Meanwhile, the cost to build the facilities comes largely from debt financing with a borrowing rate under 5%, Nicholson said.

The company has said previously — and continues to stress in investor materials — that it will soon spin out ZeroParks into a pure-play green hydrogen business.

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Canada’s Charbone Hydrogen appoints CFO

Charbone Hydrogen Corporation has appointed Benoit Veilleux as chief financial officer.

Charbone Hydrogen Corporation has appointed Benoit Veilleux as chief financial officer, effective 15 August.

This position was previously filled by Stéphane Dallaire, who will be promoted to executive vice president, according to a news release.

Veilleux began his professional career at KPMG LLP in 2003, where he managed and coordinated audit teams for public companies until 2010. From 2010 to 2013, he took the role of information analyst for the Autorité des marchés financiers du Québec where he was involved in the continuous disclosure review program applicable to public companies. From 2013 to 2021, he acted as finance manager of special projects, then as a corporate controller for Air Liquide Canada. In 2021, he became senior director of corporate finance at Hypertec Group where he was responsible for the company’s corporate finance and accounting departments.

“I would like to thank Stéphane for assuming the role of CFO at a critical stage of Charbone’s corporate history and look forward to his future contribution to our growth initiatives. With our inaugural financing and listing transaction behind us, I welcome the opportunity to have Benoit join our team. The unique combination of energy and finance experience that he brings will prove invaluable to Charbone, as we seize on the green hydrogen opportunity and execute on our ambitious growth plan,” said Dave B. Gagnon, CEO and chairperson of the board of Charbone.

Charbone is a Canadian green hydrogen group. The company’s strategy is to develop modular and expandable hydrogen facilities and regional hubs. With the acquisition of hydroelectric power plants in the United States and Canada, Charbone will be able to produce green dihydrogen molecules using reliable and sustainable energy in order to distinguish itself as a supplier of an ecological solution for industrial and commercial companies.

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Global Clean Energy takes USDA grant for feedstock project

A $30m pilot project is meant to accelerate the market for camelina sativa as a feedstock for sustainable fuels, as demonstrated in a biofuels refinery in southern California.

Global Clean Energy Holdings and the United States Department of Agriculture (USDA) have signed a contract for the Partnerships for Climate-Smart Commodities Grant for their Climate-Smart Camelina Project, according to a news release.

With the signing, work can officially begin on their $30m pilot project to measure and validate the advantages of Camelina sativa (camelina) as an ultra-low carbon nonfood renewable fuel feedstock.

Climate-Smart Camelina is a large-scale pilot project to implement, measure, and validate the climate advantages of camelina in both rotational (fallow acres) and winter crop (e.g., in a double-crop rotation) production systems.

The project is meant to accelerate farmers’ adoption of camelina grown to produce feedstock for renewable biofuels and chemicals without causing land-use change and while increasing carbon capture in the soil.

Further, the project is meant to support market development to provide additional revenue streams to growers and provide a premium for this low carbon intensity crop.

Global Clean Energy’s wholly owned subsidiary, Sustainable Oils, Inc., contracts directly with farmers to grow camelina currently in Colorado, Idaho, Kansas, Montana, Nebraska, North Dakota, Oklahoma, Oregon, and Washington.

Camelina grain is refined in the company’s Bakersfield Renewable Fuels refinery in California.

The USDA Climate-Smart Commodities announcement can be accessed here.

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AGDC seeks $150m in development capital for Alaska LNG project

The Alaska corporation is raising capital to reach FID on a $44bn LNG project that includes the construction of a natural gas pipeline and carbon capture infrastructure.

The Alaska Gasline Development Corporation (AGDC) is actively working to raise $150m in development capital for the Alaska LNG project, with Goldman Sachs providing advisory services.

This capital will cover third-party Front End Engineering Design (FEED) costs, project management, legal and commercial expenses, and overhead for 8 Star Alaska, the entity overseeing the project. Investors will receive a majority interest in both 8 Star Alaska and Alaska LNG as part of the fundraising efforts, according to a presentation​​.

AGDC, a public corporation of the state of Alaska, is hoping to finalize a deal for development capital in the next 12 months, but has not set a definitive timeline for the fundraise, AGDC’s Tim Fitzpatrick said.

The total cost of the project is estimated at $44bn, according to Fitzpatrick, and consists of three principal infrastructural components:

  1. Arctic Carbon Capture (ACC) Plant: Located in Prudhoe Bay on Alaska’s North Slope, this plant is designed to remove carbon dioxide and hydrogen sulfide before natural gas enters the pipeline.
  2. Natural Gas Pipeline: This 807-mile pipeline, with a 42-inch diameter, connects the ACC plant to the LNG facility and is capable of transporting 3.7 billion ft³/d of natural gas. It includes multiple offtake points for in-state residential, commercial, and industrial use.
  3. Alaska LNG Facility: Situated at tidewater in Nikiski, Alaska, this facility features three liquefaction trains, two loading berths, two 240,000 m³ LNG tanks, and a jetty. It is designed to produce 20 million tons per year of LNG​​.

Strategies to raise the necessary funds include collaborating with established LNG developers, strategic and financial investors, and possibly forming a consortium, according to the presentation. All project equity will flow through 8 Star Alaska, keeping the legal and commercial structure of the project consistent​​.

As of last year, the corporation was negotiating sales agreements for a significant portion of the Alaska LNG project’s capacity. Discussions include contracts covering 8 million tonnes per annum (MTPA) at fixed prices and market-linked charges, and equity offtake talks for up to 12 MTPA. Additionally, three traditional Asian utility customers have shown interest in a minimum of 3 MTPA, potentially increasing to 5 MTPA.

These negotiations involve traditional Asian utility buyers, LNG traders, and oil and gas companies, all credit-worthy and large-scale market participants, the company said. Some buyers are contemplating equity offtake, investing at the Final Investment Decision (FID) in exchange for LNG supplied at cost​​.

A key component of the project’s advancement is securing gas supply agreement terms, identified as a prerequisite by multiple investors. AGDC has held meetings with executives from two major producers to emphasize the need for Gas Supply Precedent Agreements to attract further investment. These discussions, highlighting the project’s importance to Alaska, were joined by key figures including the DOR Commissioner Crum, the DNR Commissioner Boyle, and representatives from Goldman Sachs​​.

The Japan Energy Summit, sponsored by AGDC, focused on the need for new LNG capacity in Asia. Japan’s Ministry of Economy Trade & Industry (METI) expressed strong support for new LNG investments and offtake, emphasizing the replacement of coal with gas in developing Asian markets​​.

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Exclusive: Seattle biomass-to-chemical firm planning equity round

A firm with plans for a biorefinery in Washington state will raise its first large equity round early next year.

Planted Materials, a Seattle-based biomass-to-chemicals company, is in early design stages for its first biorefinery in eastern Washington state and planning to raise an equity round in early 2025, co-founders Noah Belkhous and Greg Jenson said in an interview.

The company will seek to raise between $10m and $20m ahead of FID on the biorefinery, Belkhous said. The four-year-old company has raised $500k from angel investors to date and is currently raising another $1m from high net worth individuals in the Seattle region.

Planted Materials does not have a relationship with a financial advisor but is open to one, Belkhous said.

The company’s recycling model takes municipal landfill waste and converts it to chemical materials for pharmaceutical, paper, plastic and other manufacturing industries.

The proprietary recycling process is something the company would like to license to municipalities in the US and abroad, in addition to building biorefineries in the Pacific Northwest, Belkhous said. The company’s lab is currently based in the Ballard neighborhood of Seattle.

Early design work on the first biorefinery is underway. The duo expects CapEx to cap at $50m, reaching FID in 2026 and beginning construction that year.

While the majority of the company’s feedstock will likely come from the major metropolitan regions in the western PNW, refining capacity is more attractive in the east for reasons of space and existing waste management infrastructure. Jenson noted the presence of the relevant research campus of Washington State University in Pullman, as well as the Pacific Northwest National Laboratory in Richland.

Recently, the team accompanied Washington Governor Jay Inslee and members of the Washington State Department of Commerce on a trip to Sydney and Melbourne in Australia. The company has applied to a pair of $350k grants from the state.
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Exclusive: Zero-emission locomotive start-up in Series B capital raise

A locomotive start-up focused on the US market for zero-emission freight trains is undergoing a Series B capital raise, with sights on a much larger Series C raise next year.

OptiFuel Systems, a provider of zero-emission line haul locomotives and generation solutions, is conducting a $30m Series B capital raise.

The South Carolina-based firm is seeking to finalize the Series B by the end of this year, and plans to use proceeds to advance production of its zero-emission technologies for the rail industry, which represents a massive decarbonization opportunity, CEO Scott Myers said in an interview.

Meanwhile, the firm will seek to tap the market for around $150m for a Series C next year, Myers added. The company is not working with a financial adviser. 

While the Series B will focus on bringing to production some of OptiFuel’s smaller rail offerings, such as the switcher locomotives, the Series C will be mostly dedicated to progressing testing, manufacturing, and commercialization of its larger line haul locomotive.

The company is also considering making its own investments into digesters for RNG facilities, from which it would source the gas to run its RNG-fueled locomotives. As part of its offering, OptiFuel also provides refueling infrastructure, and envisions this aspect of its business to be just as profitable as selling trains.

“We anticipate that we would be the offtaker” of RNG, “and quite potentially, the producer,” Cynthia Heinz, an OptiFuel board member, said in the interview.

A systems integrator, OptiFuel offers modular locomotives for the freight industry that can run on zero-emission technology such as renewable natural gas, batteries, and hydrogen. The company recently announced that it will begin testing of its RNG line haul locomotive, which is a 1-million-mile test program that will take two years and require 10 RNG line haul locomotives.

Image: OptiFuel

The company’s target market is the 38,000 operating freight trains in the U.S., 25,000 of which are line haul locomotives run by operators like BASF, Union Pacific, and CSX. Fleet owners will be required to phase out diesel-powered trains starting next decade following passage of in-use locomotive requirements in California, which includes financial penalties for pollution and eventual restrictions on polluting locomotives. Other states are evaluating similar measures.

“The question is not will the railroads change over: they have to,” Myers said. “The question is, how fast?”

Following completion of testing, OptiFuel aims to begin full production of the line haul locomotive – which has a price tag of $5.5m per unit – in 2028, and is aiming to produce 2,000 per year as a starting point. The smaller switcher units are priced between $1.5m and $2.5m depending on horsepower.

OptiFuel has held discussions with Cummins, one of its equipment providers, to source at least 2,000 engines per year from Cummins to support its production goal. 

“That’s a $10bn-a-year market for us,” Myers added.

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