Gevo to Sell Renewable Natural Gas to bp
09 August 2021 - 11:00PM
Gevo, Inc. (NASDAQ: GEVO), is extremely pleased to announce today
that its wholly-owned dairy manure-based renewable natural gas
(“RNG”) project company located in northwest Iowa, Gevo NW Iowa
RNG, LLC (“NW Iowa RNG”), has signed binding, definitive agreements
with BP Canada Energy Marketing Corp. and BP Products North America
Inc. (collectively, “bp” ) for the sale of NW Iowa RNG’s production
(the “bp Agreements”).
The NW Iowa RNG project is currently being constructed and is
expected to commence production in early 2022. Upon project
completion, NW Iowa RNG is estimated to produce approximately
355,000 MMBtu of RNG per year. The RNG is expected to be sold into
the California market under dispensing agreements bp has in place
with Clean Energy Fuels Corp., the largest fueling infrastructure
in the U.S. for RNG.
RNG-fueled vehicles are estimated to result in up to 95 percent
lower emissions than those fueled by gasoline or diesel on a
lifecycle basis, according to a US Department of Energy
study.
It is anticipated that NW Iowa RNG will benefit from
environmental product revenues under California’s Low Carbon Fuel
Standard program and the U.S. Environmental Protection Agency’s
Renewable Identification Number program.
Beginning in late 2022 upon stabilized operations and pathway
certifications of its environmental products, NW Iowa RNG is
expected to generate cash distributions to Gevo of approximately $9
to $16 million per year. Starting in 2024, Gevo will have the right
to use a portion of NW Iowa RNG’s production as process energy at
its Net-Zero 1 Project or other production facilities, including
future Net-Zero projects.
“RNG is proving to be a key fuel in the energy transition. bp
has a value chain that allows RNG to reach the transportation
market, and it’s a pleasure to work with a company that shares our
vision of a low-carbon future,” said Dr. Patrick R. Gruber, Chief
Executive Officer of Gevo. “This is an excellent opportunity to
meet the growing demand for RNG and to expand our RNG business. We
are glad to be working with bp.”
For more information and details about the terms of the bp
Agreements, please see the Current Report on Form 8-K that Gevo has
filed with the U.S. Securities and Exchange Commission on August 9,
2021.
About GevoGevo’s mission is to transform
renewable energy and carbon into energy-dense liquid hydrocarbons.
These liquid hydrocarbons can be used for drop-in transportation
fuels such as gasoline, jet fuel and diesel fuel, that when burned
have potential to yield net-zero greenhouse gas emissions when
measured across the full life cycle of the products. Gevo uses
low-carbon renewable resource-based carbohydrates as raw materials,
and is in an advanced state of developing renewable electricity and
renewable natural gas for use in production processes, resulting in
low-carbon fuels with substantially reduced carbon intensity (the
level of greenhouse gas emissions compared to standard petroleum
fossil-based fuels across their life cycle). Gevo’s products
perform as well or better than traditional fossil-based fuels in
infrastructure and engines, but with substantially reduced
greenhouse gas emissions. In addition to addressing the problems of
fuels, Gevo’s technology also enables certain plastics, such as
polyester, to be made with more sustainable ingredients. Gevo’s
ability to penetrate the growing low-carbon fuels market depends on
the price of oil and the value of abating carbon emissions that
would otherwise increase greenhouse gas emissions. Gevo believes
that its proven, patented technology enabling the use of a variety
of low-carbon sustainable feedstocks to produce price-competitive
low-carbon products such as gasoline components, jet fuel and
diesel fuel yields the potential to generate project and corporate
returns that justify the build-out of a multi-billion-dollar
business.
Gevo believes that the Argonne National Laboratory GREET model
is the best available standard of scientific-based measurement for
life cycle inventory or LCI.
Learn more at Gevo’s website: www.gevo.com
Forward-Looking StatementsCertain statements in
this press release may constitute “forward-looking statements”
within the meaning of the Private Securities Litigation Reform Act
of 1995. These forward-looking statements relate to a variety of
matters including, without limitation, the development and
construction of the the NW Iowa RNG project, the bp Agreements, the
ability of Gevo to realize production of RNG with NW Iowa RNG,
Gevo’s ability to generate cash from NW Iowa RNG, and other
statements that are not purely statements of historical fact. These
forward-looking statements are made on the basis of the current
beliefs, expectations and assumptions of the management of Gevo and
are subject to significant risks and uncertainty. Investors are
cautioned not to place undue reliance on any such forward-looking
statements. All such forward-looking statements speak only as of
the date they are made, and Gevo undertakes no obligation to update
or revise these statements, whether as a result of new information,
future events or otherwise. Although Gevo believes that the
expectations reflected in these forward-looking statements are
reasonable, these statements involve many risks and uncertainties
that may cause actual results to differ materially from what may be
expressed or implied in these forward-looking statements. For a
further discussion of risks and uncertainties that could cause
actual results to differ from those expressed in these
forward-looking statements, as well as risks relating to the
business of Gevo in general, see the risk disclosures in the Annual
Report on Form 10-K of Gevo for the year ended December 31, 2020,
and in subsequent reports on Forms 10-Q and 8-K and other filings
made with the U.S. Securities and Exchange Commission by Gevo.
Investor and Media Contact+1
720-647-9605IR@gevo.com
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