Personnel moves

Oberon Fuels adds executives

The renewable fuels firm has added executives from Key Capture Energy and Chevron.

December 14, 2023

Oberon Fuels, a renewable fuels firm, has hired its first Chief Financial Officer Ann Anthony and new Chief Operating Officer Derek Winkel to drive the company’s growth.

Both Anthony and Winkel will play critical roles in growing the business as it scales up the commercializations of its renewable DME and methanol, the company said in a news release.

Along with additional senior leaders, Anthony and Winkel will help Oberon scale to decarbonize the propane industry — which emits emissions equivalent to the commercial aviation market — while accelerating hydrogen infrastructure.

“Ann and Derek each bring invaluable experience to support Oberon Fuels on its journey to commercialization and deliver the full impact that renewable fuels can have on reducing carbon emissions,” said Oberon Fuels President & CEO Rebecca Boudreaux.

Anthony brings nearly 30 years of experience helping innovative energy companies scale and successfully introduced OPAL Fuels, a renewable natural gas company, to the public markets. Before OPAL Fuels, Anthony served as the chief financial officer and secretary for Key Capture Energy, a VC-backed start-up focused on stand-alone battery storage in key electricity markets, where she played an instrumental role in the company’s acquisition by SK E&S Co., Ltd. She was also responsible for leading the company’s finance and human resources function, including financial planning and analysis, corporate procurement and capitalization efforts.

Winkel has nearly two decades of experience leading and scaling operations for renewable energy innovators. He most recently served as the vice president of manufacturing development, commercial performance and services for Chevron following the company’s acquisition of Renewable Energy Group (REG) at a $3.15B valuation. Following the acquisition, Winkel played a pivotal role in the improvement and expansion of their renewable diesel production facility, which took total site production capacity from 90M gallons per year to 340M gallons per year.

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M&A

Nutrien evaluating $2bn blue ammonia project in Louisiana

Nutrien, a publicly traded company based in Canada, is evaluating Geismar, Louisiana as the site to build a clean ammonia facility.

Nutrien, a publicly traded company based in Canada, is evaluating Geismar, Louisiana as the site to build a clean ammonia facility, according to a news release.

Building on the company’s expertise in low-carbon ammonia production, the project will proceed to the front-end engineering design phase with a final investment decision expected in 2023.

If approved, construction of the approximately $2bn project would begin in 2024 with full production expected by 2027.

The new clean ammonia plant would use natural gas and high-quality carbon capture and sequestration infrastructure at its existing Geismar facility to serve agriculture, industrial and emerging energy markets.

The plant is expected to have an annual production capacity of 1.2 million metric tonnes of clean ammonia and capture at least 90 percent of CO2 emissions, permanently sequestering more than 1.8 million metric tonnes of CO2 in dedicated geological storage per annum.

Nutrien has signed a term sheet with Denbury Inc. that would allow for expansion of the existing volume of carbon sequestration capability in its Geismar facility, if selected as the final site of construction.

The company has also signed a Letter of Intent to collaborate with Mitsubishi Corporation for offtake of up to 40 percent of expected production from the plant to deliver to the Asian fuel market, including Japan, once construction is complete.

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May 18, 2022

Innovation, Raising capital

Technology in focus: Avnos’ hybrid direct air capture uses water instead of heat

By using water captured from the atmosphere to regenerate its CO2-capturing sorbents, Avnos hopes to cut the operating costs of direct air capture plants and lower barriers to deployment.

One of the challenges of direct air capture (DAC), the new technology that promises to extract carbon dioxide (CO2) directly from the air all around us, is that it needs a lot of energy, and thus costs a lot of money. Currently, different types of DAC technologies require between 6 and 10 gigajoules per ton of carbon dioxide captured, according to the International Energy Agency.

The key to making a new DAC technology successful therefore is cutting energy needs and costs. Avnos, a Los Angeles-based carbon removal company, is trying to accomplish this by developing what it calls hybrid direct air capture (HDAC), backed by $36m in Series A funding closed in February, and over $80m in strategic and investment partnerships, announced in July.

Avnos’ process is described as “hybrid” DAC because it captures both CO2 and water, as humidity, from the atmosphere at the same time.

“In a generic DAC process, heat is critical to separating the captured CO2 from its ‘sponge,’ or sorbent, and regenerating that sorbent so that a plant may operate cyclically,” Avnos co-founder and CEO Will Kain said in an interview. “By contrast, Avnos uses a reaction enabled by the water it sources from the atmosphere to regenerate its sorbents. The impact of this use of water in the place of heat lowers the operating costs of an Avnos plant and lowers the barriers to deployment.”

Less heat means less energy, which means companies using Avnos’ technology will have to compete less than regular DAC to access carbon-free energy sources and will have more flexibility in terms of where to put their facilities.

“Unlike peer DAC companies who build and operate their hardware, our product is designed to be licensed and operated by any company committed to decarbonization and allows them to upgrade, modularly, as the tech advances over the long term,” Kain told ReSource.

Avnos has an active pilot plant in Bakersfield, California, funded by the Department Of Energy and SoCal Gas. The plant began operating in November 2023, and it can capture 30 tons of CO2 and produce 150 tons of water annually.

The company is also in the process of building a second pilot plant with the U.S. Office of Naval Research to pilot CO2 capture and e-fuels production – Avnos does not currently produce e-fuels, but sustainable aviation fuels producers could use its technology to source water and CO2, and it partners with sustainable aviation investors like JetBlue Ventures and Safran.

Additionally, it is going to use money from its recently announced round of funding to open a research and development facility outside New York City, and it says it’s involved in four of the developing DAC hubs that were selected for funding awards by the DOE: the California Direct Air Capture Hub, the Western Regional DAC Hub, the Pelican-Gulf Coast Carbon Removal, and a fourth undisclosed one.

February 27, 2024

M&A, Project news

Gulf Coast ammonia plant trades at 9.3x

Australia-based Incitec Pivot Limited sold the Louisiana plant to CF Industries for an EV-to-EBITDA multiple of 9.3x.

Global hydrogen and nitrogen manufacturer CF Industries purchased the Waggaman ammonia production complex in Louisiana at an EV multiple of 9.3x, executives from the seller, Incitec Pivot, said on a call today.

The multiple is over the through-the-cycle EBITDA generated at the plant, and compares to a five-year EV-to-EBITDA multiple for IPL of 7.3x, the company’s CFO, Paul Victor, said. The facility has a nameplate capacity of 880,000 tons of ammonia annually.

IPL considered several proposals in a competitive sale process, and was similarly focused on securing a long-term supply agreement from the plant for its Dyno Nobel subsidiary, which manufactures commercial explosives.

JP Morgan served as sellside financial advisor while Latham & Watkins was legal counsel. Goldman Sachs is serving as the financial advisor to CF Industries on the transaction. Skadden, Arps, Slate, Meagher & Flom LLP is acting as legal advisor to the buyer.

Under the terms of the agreement, CF Industries will purchase the Waggaman ammonia plant and related assets for $1.675bn. The companies will allocate approximately $425m of the purchase price to a long-term ammonia offtake agreement under which CF Industries will supply up to 200,000 tons of ammonia per year to Dyno Nobel.

CF Industries expects to fund the remaining $1.25bn of the purchase price with cash on hand.

The buyer also anticipates implementing CCS at the site on an accelerated timeline, according to the deal announcement. Incitec executives declined to say on today’s call whether there would be pricing adjustments in the offtake contract once the low-carbon blue ammonia comes online.

March 21, 2023

Project news, Raising capital

Exclusive: Emissions reduction technology firm in Series A capital raise

A technology start-up that uses plasma to reduce emissions from natural gas and methane flaring is seeking an additional $15m to top off its Series A capital raise. One of its principal products converts natural gas into hydrogen and usable graphene with no CO2 emissions.

Rimere, a climate solutions company with proprietary plasma technology, is seeking to raise an additional $15m as part of its ongoing Series A capital raise.

The start-up recently announced an anchor investment of $10m from Clean Energy Fuels Corp, a publicly listed renewable natural gas firm, and is pursuing further investments from strategics and financial players, with an eye on closing the round in 2Q24, CEO Mitchell Pratt said in an interview.

The company is not currently working with a financial advisor on the Series A capital raise, Pratt said. Its legal counsel is Morrison Foerster.

The anchor investment along with additional funds raised will allow Rimere to advance development and field testing of its two principal products, the Reformer and the Mitigator.

The Mitigator is a plasma thermal oxidizer that reduces the greenhouse gas potency of small-scale fugitive methane emissions, while the Reformer transforms natural gas into clean hydrogen and usable graphene without creating any CO2 emissions.

The products are meant to work in tandem to decarbonize natural gas infrastructure and deliver cleaner gas to end users in transportation, power generation, and industry.

“We believe that, overall, what the technology does is revalue natural gas reserves and the long-term viability of natural gas for global future energy,” Pratt said.

Commercial strategy

Rimere will develop a commercial strategy throughout the course of this year for the Mitigator, and plans to deploy the product in the beginning of next year.

“We have quite a bit of interest for this as a solution because of the low cost of the product and the terrific results,” Pratt said, noting that the Mitigator removes CO2 for under $5 per metric ton.

In contrast, the Inflation Reduction Act passed in 2022 introduced the Methane Emissions Reduction Program, a charge on methane emitted by oil and gas companies that report emissions under the Clean Air Act. The charge starts at $900 per metric ton of methane for calendar year 2024, increasing to $1,500 for 2026 and beyond.

To be sure, the Mitigator, as a thermal oxidizer, transforms methane, which is a much more potent greenhouse gas, into hydrogen, water, and CO2 for a net reduction of the global warming impact of 200 metric tons a year of CO2.

The Reformer, a container-style unit, is being scaled up to produce 50 kg per day of hydrogen from natural gas along with 150 kg of graphene, a marketable nano carbon where the CO2 is captured. Graphene is used in batteries, composites, medical devices, and concrete to reduce greenhouse gas emissions, among other applications.

Rimere plans to increase the scale of the Reformer to between 400 – 600 kg per day and raise additional funds next year, Pratt said. The amount of funds needed for that is not yet known, he said.

Pratt envisions an application for hydrogen blending using the two products.

“We see it as a way to decentralize hydrogen production, taking advantage of a cleaner natural gas infrastructure, because we’ve applied the Mitigator to cleaning up those fugitive methane emissions that are occurring in the normal operations of equipment,” Pratt said.

For example, Rimere can tap into a natural gas pipeline, take a slipstream of gas, extract the valuable graphene, and then re-inject hydrogen and natural gas back into the pipeline.

Additionally, the blending application can be positioned at an end-use customer’s facility, allowing the Reformer to start blending hydrogen into the gas stream, going into boilers and burners and reducing the CO2 emissions more effectively and immediately, Pratt said.

$1 per kg

Taking the average cost of delivered natural gas and power to industrial users, the company can already produce hydrogen at $1 per kilogram, Pratt said.

For every four kilograms of end-use product – one being hydrogen, the other three graphene – the energy cost allows hydrogen to be produced at or below $1 per kg.

“The last 12 months of running is less than a dollar,” he said, emphasizing that the graphene production is not subsidizing the hydrogen.

“Although the value of graphene could make hydrogen a throwaway fuel.”

February 26, 2024

Project finance, Raising capital

Exclusive: Mississippi green hydrogen developer assembling banks for debt raise

The developer of a potentially massive network of green hydrogen production, transport and salt cavern storage — estimated to cost billions — is seeking banks to support a project debt raise.

Hy Stor, the developer of hydrogen generation and salt cavern storage, is currently raising “billions” in project finance for the first phase of its home state hub in Mississippi, Chief Commercial Officer Claire Behar said in an interview.

The first phase is expected to enter commercial service in 2026, guided by customers, Behar said.

Connor Clark & Lunn are equity partners in the Mississippi hub and is helping Hy Stor with its debt raise. Hy Stor is working with King & Spalding as legal advisor.

“We are already seeking banks and lining up our needed debt,” Behar said. She declined to say a precise amount the company will raise but said it will be in the billions.

Hy Stor plans to soon announce their renewable development partner to build dedicated off grid renewables, Behar said. The same is true for offtake in non-intermittent 24-hour industries like steel, plastic and fertilizer manufacturing.

“The customers are willing to pay that twenty-to-thirty percent premium that the market would need,” Behar said. “The business case is there.”

When asked if traditionally carbon intensive industrial manufacturing interests were actively seeking to co-locate with Hy Stor in Mississippi, Behar said the company has been advancing those agreements and hopes to have announcements soon.

There is evidence of this type of activity in the state. Recently American steel manufacturer Steel Dynamics announced Columbus, Mississippi as the location of its upcoming aluminum flat rolled mill, with a focus on decarbonization. Job postings for engineering roles at a separate facility detail plans to convert biomass into a direct carbon replacement suitable for steelmaking.

Hy Stor hopes to have announcements in the coming weeks about a co-location opportunity, she added. Both domestic and international strategics are interested in the geology offering co-located salt cavern storage and geography offering river and deepwater port logistics networks, as well as highway and rail corridors.

Off-grid renewable generation means the company is not at the mercy of transmission interconnection queues. It also offers reliability because the lack of grid adage helps guarantee performance, and affordability because the company doesn’t have to pay utility rates, Behar said. Additionally, the electricity is decoupled from the grid and therefore absolutely decoupled from fossil fuels, which is important to Hy Stor’s prospective offtakers.

“This is what customers are demanding,” Behar said, adding that first movers are highly dedicated to decarbonization, needing quantitative accounting for all scope emissions, driven often by pressure from their customers.

The company has received a permit to take 11,000 gallons per minute of unpotable water from the Leaf River in Mississippi, Behar said, and is also looking at in-house wastewater treatment and water recycling.

Don’t go after gray users

Behar said the concept that users of gray hydrogen are the first targets for green hydrogen developers is misguided.

“The refineries, the petrochemicals, for them hydrogen is an end product already used within their system,” Behar said. “Those are not going to be the first users that are going to pay us a premium for that zero carbon.”

Hy Stor is instead focusing on new greenfield facilities that can co-locate.

“We’ve purposefully outsized our acreage,” she said of the 70,000 acres the company has purchased outside of Jackson, Mississippi, the Mississippi River Corridor, and the state’s southern deepwater ports in Gulfport and Port Bienville. New industrial projects can co-locate and have direct access to the salt cavern storge.

Looking forward the company’s acreage and seven salt domes mean they are not constrained by storage, Behar said. At each location, the company can develop tens and hundreds of caverns.

February 9, 2024

exclusive

M&A, Raising capital

Quantron kicks off Series B equity raise

The German and American mobility provider is seeking to raise EUR 200m in a Series B equity raise, as the company plans to become a one-stop-shop for hydrogen-powered commercial vehicles, according to a teaser.

Quantron, the Germany and US-based hydrogen trucking manufacturer, is seeking to raise EUR 200m in a Series B capital raise, and has further plans to raise money in a Series C in 2024 or 2025, followed by an anticipated IPO beyond 2025.

The company plans to use proceeds from the Series B accelerate the roll-out of existing production and make additional market entries included expanding its operations in the US, according to a sale teaser seen by The Hydrogen Source. Stifel is leading the capital raise, as previously reported.

By advancing a full-scale zero-emission ecosystem, Quantron is seeking to take part in the sourcing and distribution of green energy and hydrogen, as well as building fuel cell and battery electric vehicles and components and offering customer solutions like aftersales, the teaser notes.

Quantron, which has offices in Augsburg, Germany and Detroit, Michigan, has brought in about EUR 28m in revenues since inception and expects EUR 60m in revenue this year, fueled by a EUR 100m order book and pipeline. The company has put 150 vehicles on the road to date and has 130 employees.

Its Series A capital raise of EUR 45m, completed in September, 2022, implied a EUR 250m pre-money valuation. The ongoing EUR 200m capital raise will come in the form of the Series B financing as well as working capital facilities.

The company recently announced commitments with FirstElement Fuel and Goldstone Technologies Limited. Quantron debuted its Class 8 hydrogen fuel-cell truck in the US at the Advanced Clean Transportation Expo in Anaheim, California in April.

June 28, 2023