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Navigator CO2 cancels pipeline project

The BlackRock-backed Navigator CO2 pipeline encountered pushback from residents and local authorities across its proposed footprint.

BlackRock-backed Navigator CO2 has cancelled its $3.4bn pipeline project known as Heartland Greenway.

In a press release, the company said it had decided to cancel the project “given the unpredictable nature of the regulatory and government processes involved, particularly in South Dakota and Iowa.”

The Navigator CO2 pipeline has faced pushback from residents and local authorities across its footprint. South Dakota denied a permit for the pipeline in September. And proponents were forced to re-file applications for eminent domain powers in Illinois after state regulators said the filing was incomplete.

The proposed pipeline was contracted with industrial producers to capture, transport, and store up to 10 million metric tons of CO2 annually. When fully expanded, the system would have been able to transport up to 15 MMT of CO2 annually, according to documentation.

Navigator had also reached an agreement with e-fuels developer Infinium to deliver 600,000 tons per annum (TPA) of biogenic carbon dioxide (CO2) from its Heartland Greenway system to a future Infinium facility for the production of fuels.

Matt Vining, CEO of Navigator CO2 said, “As good stewards of capital and responsible managers of people, we have made the difficult decision to cancel the Heartland Greenway project. We are disappointed that we will not be able to provide services to our customers and thank them for their continued support.”

Vining continued, “I am proud that throughout this endeavor, our team maintained a collaborative, high integrity, and safety-first approach and we thank them for their tireless efforts. We also thank all the individuals, trade associations, labor organizations, landowners, and elected officials who supported us and carbon capture in the Midwest.”

 

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CAD $20m awarded to 18 Alberta hydrogen projects

The total value of the funded projects, including matching investments for project partners, is more than CAD $200m.

The Alberta Hydrogen Centre of Excellence is awarding CAD $20m to 18 projects to advance innovations in hydrogen through its first funding competition, according to a press release.

A full list of the projects can be seen here.

One of the projects is the proposed Bremner 100% Hydrogen Community in Strathcona County, Alberta. ATCO and Qualico are studying the logistics, technology requirements and other considerations involved in developing 100% pure hydrogen communities – an step toward eliminating carbon emissions produced by hot water use.

“Other successful projects in the competition will examine the safe and effective use of pipelines for hydrogen transmission,” the release states. “Another project will look at how to convert heavy-duty long-haul trucks to dual-fuel machines. In all, projects will examine everything from production, transmission, distribution, and storage, to end-uses of hydrogen.”

A total of 68 project proposals were received. The HCOE will fund up to 50 per cent of eligible costs for the successful projects, or up to 75 per cent of eligible costs for projects led by post-secondary institutions, or those with a significant Indigenous component.

The total value of the funded projects, including matching investments for project partners, is more than CAD $200m. Projects have 24 months to complete their proposed work.

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Williams and Daroga sign MoU to find offtake options

The companies will identify long-term end-use customers for clean hydrogen and offtake options for environmental attributes generated by hydrogen production in Wyoming.

Williams has signed a memorandum of understanding (MOU) with Daroga Power to identify long-term end-use customers for clean hydrogen and offtake options for environmental attributes generated by hydrogen production in Wyoming.

Williams plans to leverage its nationwide assets for the blending, storage and transportation of clean hydrogen to local and regional markets, including the Pacific Northwest via the company’s 4,000-mile bi-directional Northwest Pipeline transmission system that passes through Wyoming.

Deliveries of hydrogen could begin as soon as 2025.

The company is currently working with the University of Wyoming’s School of Energy Resources to evaluate hydrogen production and the impacts of hydrogen blending on existing energy infrastructure in Wyoming. The research is funded by a grant from the Wyoming Energy Authority and is expected to be complete in 2023.

Daroga is a New York-based investor and developer of distributed generation energy assets, including hydrogen fuel cells and solar power generation.

Beyond Wyoming, Williams has joined several recently launched industry-led regional alliances including Appalachian Energy Future (AEF) and Appalachian Regional Clean Hydrogen Hub, or Arch2. Williams is also engaged with the New York State Energy Research and Development Authority (NYSERDA).. Williams has identified two potential projects to deliver hydrogen in New York and New Jersey using the company’s existing infrastructure.

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Calumet subsidiary Montana Renewables inks supply and offtake agreement with Macquarie

Montana Renewables is developing a renewable hydrogen facility that will supply hydrogen to a plant producing renewable fuels.

Calumet Specialty Products Partners has closed two transactions that together fund the working capital needs of Montana Renewables LLC (MRL), including a supply and offtake agreement with Macquarie Commodities and Global Markets, according to a news release.

The Macquarie supply and offtake agreement provides inventory monetization for renewable feedstocks and products, as well as intermediation services connected with the purchase of renewable feedstocks.

Simultaneously, a $90m asset backed loan revolving credit facility was executed with Wells Fargo Bank, NA, secured by accounts receivables and open blenders tax credit refunds.

“Now that Montana Renewables has commenced operations, these transactions ensure that our working capital needs are met going forward,” said Bruce Fleming, EVP Montana Renewables. “Third party inventory financing has been in the MRL plan since day one, and we are pleased to execute on the plan as we launch operations.”

Once fully operational, Montana Renewables, based in Great Falls, Montana, will use waste feedstocks to produce low-emission alternatives that directly replace fossil fuel products including Renewable Hydrogen, Renewable Diesel (RD) and Sustainable Aviation Fuel (SAF).

Montana Renewables is developing a renewable hydrogen facility that will supply hydrogen to the plant’s hydrocracker.

In August, 2022, Warburg Pincus agreed to invest $250m in MRL in the form of a participating preferred equity security, which values MRL at a pre-commissioning enterprise value of $2.25bn. Stonebriar Commercial Finance has invested an additional $350m through a pair of sale and leaseback contracts on top of its existing $50m commitment to MRL. The sale and leaseback transactions carry an approximate 12.3% cost of capital and offer certain strategic early termination options. Concurrent with these transactions, the $300m convertible investment from Oaktree Capital Management L.P. in MRL has been retired.

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Exclusive: Geologic hydrogen startup raising Series A

A US geologic hydrogen startup that employs electric fracking with a pilot presence on the Arabian Peninsula is raising a $40m Series A and has identified a region in the midwestern US for its first de-risked project.

Eden GeoPower, a Boston-based geologic hydrogen technology provider, is engaged in raising a Series A and has a timeline on developing a project in Minnesota, CEO and co-founder Paris Smalls told ReSource.

The Series A target is $40m, with $10m being supplied by existing investors, Smalls said. This round, the company is looking for stronger financial investors to join its strategic backers.

The company has two subsidiaries wholly owned by the parent: one oil and gas-focused and one climate-focused. The Series A is topco equity at the parent level.

Eden was one of 16 US Department of Energy-selected projects to receive funding to explore geologic hydrogen; the majority of the others are academic lab projects. Eden has raised some $13m in equity and $12m in grant funding to date.

Beyond geothermal

Eden started as a geothermal resource developer, using abandoned oil and gas wells for production via electric fracking.

“We started seeing there were applications way beyond geothermal,” Smalls said. Early grant providers recommended using the electric fracking technology to go after geologic hydrogen reservoirs, replacing the less environmentally friendly hydraulic fracking process typically used.

A test site in Oman, where exposed iron-rich rock makes the country a potential future geologic hydrogen superpower, will de-risk Eden’s technology, Smalls said. Last year the US DOE convened the first Bilateral Engagement on Geologic Hydrogen in Oman.

Early developments are underway on a demonstration project in Tamarack, Minnesota, Smalls said. That location has the hollow-vein rocks that can produce geologic hydrogen.

“We likely won’t do anything there until after we have sufficiently de-risked the technology in Oman, and that should be happening in the next 8 months,” Smalls said. “There’s a good chance we’ll be the first people in the world to demonstrate this.”

Eden is not going after natural geologic hydrogen, but rather stimulating reactions to change the reservoir properties to make hydrogen underground, Small said.

The University of Minnesota is working with Eden on a carbon mineralization project, Smalls said. The company is also engaged with Minnesota-based mining company Talon Metals.

Revenue from mining, oil and gas

Eden has existing revenue streams from oil and gas customers in Texas and abroad, Smalls said, and has an office in Houston with an expanding team.

“People are paying us to go and stimulate a reservoir,” he said. “We’re using those opportunities to help us de-rick the technology.”

The technology has applications in geothermal development and mining, Smalls said. Those contracts have been paying for equipment.

Mining operations often include or are adjacent to rock that can be used to produce geologic hydrogen, thereby decarbonizing mining operations using both geothermal energy and geologic hydrogen, Smalls said.

“On our cap table right now we have one of the largest mining companies in the world, Anglo American,” Smalls said. “We do projects with BHP and other big mining companies as well; we see a lot of potential overlap with the mining industry because they are right on top of these rocks.

Anti-fracking

Eden is currently going through the process of permitting for a mining project in Idaho, in collaboration with Idaho National Labs, Smalls said.

In doing so the company had to submit a public letter explaining the project and addressing environmental concerns.

“We’re employing a new technology that can mitigate all the issues [typically associated with fracking],” Small said.

With electric fracturing of rocks, there is no groundwater contamination or high-pressure water injection that cause the kind of seismic and water quality issues that anger people.

“This isn’t fracking, this is anti-fracking,” Smalls said.
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exclusive

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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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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