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PE-backed biomass-to-energy operator on the block

A biomass-to-energy firm with four operational assets in the US and Canada has launched a sale process. The company is also developing 110 MW of co-located BESS projects, with additional revenue streams expected from organic waste diversion, gasification and carbon capture, and heavy-duty vehicle charging stations, according to a sale teaser.

Biomass-to-energy firm Greenleaf Power is for sale.

Denham Capital, the company’s private equity owner, has mandated BNP Paribas to run the process, which launched last week, according to two sources familiar with the process.

California-based Greenleaf is a biomass generation platform with 135.5 MW of fully-contracted renewable generation capacity and remaining weighted-average PPA term length of 9.5 years, according to a sale teaser.

The company’s four operational assets are the 45 MW Desert View Power, in Mecca, California; the 30 MW Honey Lake Power in Wendel, CA; the 23 MW St Felicien Cogeneration facility in Quebec; and the 37.5 MW Plainfield plant in Connecticut.

Greenleaf expects to generate $106m of biomass revenues in 2024, resulting in $24m in expected EBITDA.

According to the teaser, co-located battery energy storage projects amounting to 110 MW are also under development, with CODs expected for 2025 – 2026.

There is potential for additional revenue streams from existing infrastructure and land, including organic waste diversion, gasification and carbon capture, co-location of renewables, and heavy-duty electric vehicle charging stations, the teaser states.

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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.

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Tidewater Midstream and Tidewater Renewables appoint interim CEO

The Canadian company is facing higher estimated costs to build a renewable diesel and hydrogen plant in British Columbia.

The Boards of Directors of Tidewater Midstream and Infrastructure Ltd. and Tidewater Renewables Ltd. have appointed Robert Colcleugh as interim CEO of both companies, effective November 28, 2022, according to a news release.

Colcleugh, who currently serves as a director of Tidewater Midstream, succeeds Joel MacLeod, who is stepping down from his management and board roles to pursue other opportunities.

Tidewater executives including MacLeod said on a recent earnings call that costs would climb an estimated 10% for a renewable diesel and hydrogen plant that’s under construction in British Columbia.

Colcleugh brings significant oil and gas management expertise as well as broad business and capital markets experience to the leadership roles. Thomas Dea will serve as chairman at Tidewater Midstream and Colcleugh will serve as chairman of Tidewater Renewables with Brett Gellner continuing to serve as lead independent director of Tidewater Renewables following Macleod’s departure.

“The business outlook remains strong and both companies are well positioned for continued success,” said Mr. Dea, chairman at Tidewater Midstream. “Under Colcleugh’s leadership, the companies will continue to execute their respective business plans while ensuring they maintain a strong culture of safety, further strengthen their balance sheets, and create value for all constituents. With his significant industry experience and knowledge of the Tidewater business, we have the utmost confidence in his ability to lead the teams and generate shareholder value.”

“We will continue to focus on building a profitable, diversified midstream and infrastructure company at Tidewater Midstream,” said Colcleugh. “At Tidewater Renewables, we will continue to deliver on our commitment to supply North America with low carbon intensity fuel solutions at scale. I look forward to delivering for our valued customers, partners, and shareholders.”

Colcleugh has been a director of Tidewater Midstream since 2017. Over the last 25 years he has held a variety of operational, advisory and board roles at a broad array of domestic Canadian and international energy companies and investment banks.

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GHI assessing ABB technology for Hydrogen City

GHI has signed an MoU to assess ABB’s automation and electrification technology for deployment at the South Texas Hydrogen City green hydrogen project.

ABB is collaborating with Green Hydrogen International (GHI) on a project to develop a major green hydrogen facility in south Texas, United States.

As part of the Memorandum of Understanding ABB’s automation, electrification and digital technology will be assessed for deployment at GHI’s Hydrogen City project, according to a news release.

The Power-to-X facility will use solar and onshore wind energy to power a 2.2 GW electrolyzer plant to produce 280,000 tons of green hydrogen per year, which will be turned into one million tons of green ammonia annually.

ABB has already completed a feasibility study to develop an electrical system architecture that optimizes return on investment for the project and supports compliance with EU legislation governing Renewable Fuels of Non-Biological Origin (RFNBO)2 and the US Inflation Reduction Act (IRA). ABB plans to supply its Integrated Control Safety System with the distributed control system ABB Ability™ System 800xA® to improve efficiency, operator performance and asset utilization.

MoU scope also includes electrical motors and drives, measurement and analytics solutions, and power and process optimization solutions.

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Exclusive: Carbon conversion startup planning capital raise

A Halliburton Labs-backed startup is developing a pilot plant in the Pacific Northwestern US, while forming financial relationships for an industrial-scale carbon conversion facility in the same location.

OCOchem, a Washington state-based carbon conversion startup, will seek new capital partners to build its first commercial scale facility in 2026, CEO Todd Brix said in an interview.

Starting in late 2024 or early 2025, the company will likely go to market for new liquidity – including project debt and equity, Brix said. He declined to talk about capex, but said the first commercial plant in Richland, Washington will cost “multiple tens of millions of dollars.”

The company is working with two EPCs now and is represented legally by Miller Nash law firm in the Pacific Northwest, Brix said. The company does not have a formal relationship with an investment bank but will likely form one for a Series A and later rounds.

“We’ve been in touch with a number of private equity and project finance people,” Brix said of early-stage discussions.

OCOchem is considering land options in Richland for its first plant and is organizing to begin permitting, Brix said. There is opportunity to form relationships with industrial partners in need of an offtaker for their CO2 emissions and new incremental revenue streams, as well as customers for chloral hydrates and other formic acid products.

“We expect to build hundreds of these plants all around the planet,” Brix said, referring to the process of electrochemically converting emitted CO2 and water to formic acid, which can then be used to make a suite of products like hydrogen, carbon monoxide, and formate (methanoate) derivatives. “We are close to industrial size on our plants right now.”

CO2 is captured from steam methane reformers, natural gas processing and piping, and ammonia production, among other processes. The gas is then combined with water in a cellular, modular process producing formic acid, derivatives of which can be used in a range of industries like pharmaceuticals.

The company recently raised $5m in seed funding from lead investor TO VC, which joined backers LCY Lee Family Office, MIH Capital Management, and Halliburton Labs. An additional $8m has been raised in grant funding from the US departments of Energy (DOE) and Defense (DOD).

The company is also partnered with the Nutrien Corporation on a small scale facility in Kennewick, Washington, just upriver from Richland, Brix said. Financing for that project is largely arranged with the FEED completed.

Brix owns a majority of the company with his father.

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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.

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Exclusive: Monarch Energy targeting green hydrogen FID in 2024

Monarch is moving forward with several green hydrogen projects in the Gulf Coast region, most notably a 500 MW project near Beaumont, Texas and a 300 MW project near Geismar, Louisiana.

Green hydrogen developer Monarch Energy aims to take its first final investment decision as soon as next year, CEO Ben Alingh said in an interview.

Monarch is moving forward with several green hydrogen projects in the Gulf Coast region, most notably a 500 MW project near Beaumont, Texas and a 300 MW project near Geismar, Louisiana.

Alingh said the company is seeking to advance the projects to FID by late 2024 and early 2025. Monarch has not engaged a project finance banker yet, he said.

The company recently announced a $25m preferred equity investment and $400m project equity commitment from LS Power.

The proceeds of the preferred equity raise will fund pre-FID aspects of Monarch’s 4.5 GW green hydrogen development platform: overhead, project development, interconnection, land, permitting, and engineering.

The $400m commitment, meanwhile, is earmarked for project equity investments in Monarch’s pipeline of projects. Under the arrangement, the projects will be dropped into a new entity, Clean Hydrogen Fuels, LLC, where LS Power provides the capital and Monarch provides the project, Alingh said.

“On a project-by-project basis the projects will be transferred to Clean Hydrogen Fuels if they are selected,” he said. The Clean Hydrogen Fuels entity is jointly owned by Monarch and LS Power.

Monarch did not use a financial advisor for the capital raise. Clean Energy Counsel served as Monarch’s law firm.

For both the Beaumont and Geismar facilities, Monarch has signed MoUs with Entergy to supply long-term renewable power. Monarch is engaged with industrial users of hydrogen in each location as potential offtakers. It plans to deliver hydrogen via local Monarch-developed hydrogen pipelines that it is developing with EPC partners, he said.

“We endeavor to be as close to our end user as possible with our electrolyzer project, to limit development and execution risk on delivery,” he said. For the volumes of Monarch’s projects, trucking solutions are not on the table, he said, as it would simply require too many trucks.

The company has additional production facilities under development in Freeport, Texas, as well as four other locations in Texas, according to the ReSource project database.

Monarch is also interested in end markets for hydrogen derivatives like methanol and ammonia, but Alingh notes that every project “starts with one core focus, and that is making the cheapest green hydrogen possible.”

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