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Plug Power raises $150m in equity, in talks for debt deal

Plug Power raised $150m in at-the-market equity transactions during 1Q24, and is in conversations with two potential providers of debt for a transaction that would shore up its liquidity.

New York-based Plug Power raised approximately $150m in at-the-market equity funding in the first quarter of 2024 in an effort to shore up its liquidity.

The cash-burning green hydrogen firm is also in talks with two potential providers of debt that would help extend its runway amid a broader focus on cost reduction.

Plug previously said it would tap the at-the-market equity program to avoid having to issue going concern language, and CFO Paul Middleton said today that they have issued $150m through the program.

But the company’s primary focus is on debt solutions, he said.

“We’ve got a couple parties that we’re closer to that than we’ve ever been under terms that are things that, you know, our biggest challenge today has just been in finding terms that we feel like are meaningful and helpful for us and where we’re going,” Middleton said.

“But these are two parties that we feel extremely well about and have done a lot of diligence to know them very well,” he added, “and we’ll see whether that manifests into conclusion.”

ReSource reported last year that Plug is working with Goldman Sachs to raise debt financing.

Executives said that the company is still awaiting a conditional commitment from the DOE for a project loan, though did not provide additional color on timing.

“This program is expected to bolster the buildout of Plug’s liquid hydrogen facilities throughout the United States,” President and CEO Andrew Marsh said on the call.

Marsh added that the company is working with advisors to raise debt and equity that will complement the DOE funding for certain projects.

Plug is reviewing six projects in addition to plants in Georgia, New York, and Texas that are further advanced. The Georgia plant began operations earlier this year, and should help to alleviate Plug’s dependence on more expensive third-party hydrogen sourcing provided to customers.

The company is evaluating locations on the West Coast where it could source hydro power; the middle of the country where it could access low-cost nuclear power; a site further West with solar and wind development; and potentially two more sites in Texas.

“We can obviously always expand our existing footprint and the presence in Georgia as well,” Plug’s Sanjay Shrestha said on the call.

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8 Rivers appoints new CEO

8 Rivers Capital appoints Christopher Richardson to CEO position from law firm White & Case.

8 Rivers Capital, LLC, a decarbonization technology developer, has appointed Christopher F. Richardson as the firm’s new Chief Executive Officer, according to a news release.

He succeeds Dharmesh Patel, who has served for six months as interim CEO and previously served as Vice President and Financial Controller. Patel will ascend to the new position of Senior Vice President of Finance, effective immediately.

Richardson joins 8 Rivers with over 20 years of experience in energy and infrastructure transactions and projects and previously served as the head of the Americas energy and infrastructure projects section at the global law firm White & Case. He was based in the firm’s Houston office, which he established in 2018 as a founding partner.

In this role, Richardson led and managed a team of over 100 lawyers across eight offices in the Americas. Richardson’s expertise on developing, financing, and executing large-scale energy and infrastructure projects and related transactions spans the U.S. and more than 50 countries worldwide.

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Exclusive: Green ammonia firm in capital raise for flagship Texas project

A green ammonia firm is working with a bulge-bracket bank and undergoing a capital raise for its flagship project in Texas.

Green ammonia firm First Ammonia is undergoing a capital raise for its first project at the Port of Victoria, in Texas.

The New York-based company is aiming to take a final investment decision on the construction of the facility by mid-2024, Co-founder and CEO Joel Moser said in an interview.

The project is expected to be just the first in a global pipeline of green ammonia facilities that will eventually add up to 5 million MTPA of green ammonia production within a ten-year time horizon, Moser added.

The Port of Victoria project entails an up to 300 MW facility under an offtake arrangement with Germany’s Uniper, with First Ammonia evaluating building a first phase of 100 MW or building all under one financing, Moser said. Each 100 MW module will initially produce up to 100,000 MTPA of green ammonia. 

The 100 MW train of the project is estimated to cost approximately $300m, while the full 300 MW will cost between $900 – $1bn, he said.

“We like to think of ourselves not as a developer but as an industrial company, and the investors that we are likely going to be engaging with are interested in not just project one but our entire business model,” he added.

The arrangement with Uniper is “more than a heads of agreement,” Moser said, declining to specify further other than to say that the announcement “reflects an advanced stage” of their work together.

The company is in talks with debt and equity investors that would project finance the facility following a 70/30 debt-to-equity split, he said.

“We are evaluating financing and construction alternatives as to doing all 300 MW under one financing and a single build-out or two separate processes and will make that call in early 2024,” he said.

The firm is working with a bulge-bracket bank as an advisor for the capital raise, Moser said. He declined to name the advisor.

A regulated investment fund has committed seed capital to First Ammonia, which includes funding development capital to the FID stage, Moser said.

Beyond Texas

First Ammonia has contracted with Haldor Topsoe for 5 GW of solid oxide electrolysis for its project portfolio, which amounts to 5 million MTPA.

In the US, the company has a second project under development in New Mexico, for which Moser believes there will be ample offtake markets.

The inland New Mexico project is close to rail transport which can be used to take product to California or to a Gulf Coast port.

“The largest demand for green ammonia right now is to replace grey ammonia for its current uses, and that is in the chemical, refrigeration, and fertilizer industries,” he said, noting RED III regulations in the EU are driving demand for green ammonia. 

He added that the shipping industry will be another major demand center, in addition to replacing coal in Japanese power plants.

“You can move ammonia into Europe by barge” to many power plants that are serviced by bodies of water, he said, noting that these plants are likely to be converted to ammonia-burning facilities. Meanwhile, plants that are not accessible by water will more likely be serviced by hydrogen pipelines, he said.

Moser believes the Port of Victoria facility and other future projects will comply with the EU’s RFNBO standards as well as strict guidelines for 45V in the US.

For its technology, First Ammonia chose solid oxide electrolysis for several reasons.

“SOEC electrolysers are the future,” he said. “They use less renewable power.”

He added that, since SOECs run at high temperatures, the wasted heat from ammonia production can be captured and fed into the electrolysis process.

“If you’re making water into ammonia as opposed to stopping at the hydrogen point, you’re much better off with an SOEC than any other product.”

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Visolis and Ginko Bioworks team up on synthetic rubber and SAF ingredient production

The two companies are leveraging each other to achieve commercial development of a monomer used in the production of synthetic rubber and SAF.

Visolis, a California-based sustainable materials company, has formed a partnership with cell programming and biosecurity firm Ginkgo Bioworks to reach commercial production of a key feedstock ingredient used to make bio-based isoprene and SAF, according to a news release.

Isoprene is a monomer used for commercial scale synthetic rubber production.

“Achieving the production of bio-based isoprene at scale represents a significant step toward decarbonizing tire manufacturing,” the release states. “Isoprene can also be used as an intermediate for high performance, lower carbon intensity sustainable aviation fuel (SAF) production.”

Achieving bio-based isoprene production at scale is difficult because the molecule is highly volatile and combustible.

“Visolis has developed a novel process by using a more stable intermediate, making isoprene through a two-step manufacturing process and enabling more efficient and reliable production,” the release states. “Through the partnership with Ginkgo, the two companies are working to further optimize the efficiency of this biomanufacturing process.”

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Houston ammonia and hydrogen terminal on the block

The owners of a recently developed Houston terminal with proximity to ammonia, hydrogen, and nitrogen pipelines are working with an advisor on a sale process.

The owners of Vopak Moda Houston, a Gulf Coast hydrogen and ammonia terminaling asset, have hired an investment bank to run a sale process, according to two sources familiar with the matter.

Intrepid Investment Bankers has been retained to run the process, the sources said.

Vopak Moda and Intrepid did not respond to requests for comment.

Formed in 2016, Vopak Moda Houston is a 50/50 joint venture between Royal Vopak and Moda Midstream. Moda Midstream is a portfolio company of EnCap Flatrock Midstream, which did not respond to a request for comment.

In 2021 the JV commissioned its deepwater dock at the Port of Houston. It has constructed storage and terminal infrastructure for industrial gas product lines, with the stated intention of becoming a premier hydrogen and low-carbon ammonia terminaling hub in the Gulf Coast.

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Exclusive: Ambient Fuels options land in Texas

Ambient Fuels recently entered into an option agreement to purchase land in Texas. Among only a handful of green hydrogen developers to attract equity capital last year — from Generate Capital — Ambient has not yet made public announcements about its projects or locations. 

Ambient Fuels, a green hydrogen developer backed by Generate Capital, recently signed a 24-month option to purchase a plot of land in Chambers County, Texas, according to filings made with the clerk there.

A memorandum outlines the option to purchase land in Mont Belvieu, to the east of Houston. The agreement is effective as of October 2, according to the filing.

Ambient declined to comment.

According to the ReSource project tracker, Ambient has been involved in three Gulf Coast hydrogen hub efforts: The Alliance for Renewable Clean Hydrogen Energy Systems (ARCHES) hub; the Port of Corpus Christi Green Hydrogen Hub; and the Horizons Clean Hydrogen Hub (HCH2). ARCHES was selected for DOE funding.

ReSource reported in June that Ambient Fuels had begun to evaluate potential acquisitions of hydrogen projects that are under development.

In May, 2023, Generate Capital, a sustainable infrastructure investment and operating company, made an investment into Ambient, including a commitment to fund up to $250m of green hydrogen infrastructure.

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exclusive

Low-carbon crude refinery developer lining up project cap stack

The developer of a low-carbon crude refinery is in talks with banks and strategics to line up project financing for a $5.5bn project in Oklahoma.

Texas-based Southern Rock Energy Partners is holding discussions with banks and potential strategic investors with the aim of shaping a $5.5bn capital stack to build a low-carbon crude refinery in Cushing, Oklahoma.

The project, a first-of-its-kind 250,000 barrel-per-day crude refinery, would make it the first crude facility of that size built in the United States in several decades.

The company is evaluating a project finance route with a debt and equity structure for the project, and has held talks with several major investment banks as well as “industry-leading” strategics in midstream, industrial gas, and electricity generation, Southern Rock Managing Partner Steven Ward said in an interview.

In support of the refinery, the city of Cushing and the Cushing Economic Development Foundation approved $75m in tax-exempt private activity bonds, Ward noted. He added that the company could also tap industrial revenue bonds as well as PACE equity financing.

Seed capital for project development has so far come from strategic partners, some of which are operational partners, Ward said. He declined to comment further on the capital raise, noting that engagement letters have yet to be signed.

Engineering firm KBR is conducting a feasibility study for the Cushing project, and the company is moving through land acquisition, air permit preparation, and EPC selection, Ward said.

While most crude refineries consume natural gas, off-gasses, and ambient air, Southern Rock’s proposed refinery would use oxygen along with blue hydrogen produced from the refining off-gasses and green hydrogen from electrolysis. The process would eliminate 95% of greenhouse gas emissions at the proposed refinery.

“Our furnaces and our process heating units are fed 100% hydrogen and oxygen,” Ward said, noting that this type of system does not currently exist in the market. The company is expanding on technology it licenses from Great Southern Flameless, he said.

The size of the refinery would make it the largest to be built in the US since Marathon Petroleum built a 200,000 barrels-per-day facility in 1976.

Certain other low-carbon crude projects have been in the market for several years. Meridian Energy has been seeking to build cleaner crude refineries in North Dakota. Raven Petroleum ran up against environmental concerns while seeking to build a clean refinery in Texas. And MMEX is aiming to build an “ultra clean” crude refinery in West Texas.

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