BP Buying Existing Biomethane Production Facilities,
Freeing Clean Energy to Focus on ‘Redeem’ RNG Sales
Clean Energy Fuels said this morning that BP its buying its renewable natural gas production facilities for $155 million, while “Clean Energy will continue to focus on selling its Redeem branded RNG with a secure source of fuel for its nationwide network of stations.”
The deal, which remains subject to regulatory approval, includes biomethane production capability in Canton, Mich. and North Shelby, Tenn. as well as Clean Energy’s share of facilities under construction in Oklahoma City, Okla. and Atlanta. “BP will continue to subcontract the operations of these facilities to Clean Energy,” states this morning’s release.
““We started our Redeem fueling business from scratch less than four years ago and have grown it into a significant enterprise,” Clean Energy president and CEO Andrew Littlefair says in the announcement.
“This transaction will help to take it to the next level,” he said. “BP’s investment in and focus on renewable natural gas supply will ensure that Clean Energy can meet the growing demand of our customers for low carbon, renewable fuel.”
Clean Energy will buy renewable natural gas fuel from BP and collect royalties on gas purchased from BP and sold as Redeem at it stations. This royalty payment is in addition to any payment under BP’s contractual obligation.
60 million GGEs Last Year
Clean Energy launched the Redeem brand in California in October 2013. Last year the company sold 60 million gasoline gallon equivalents of Redeem in 2016 to customers across multiple states including UPS, Republic Services, Ryder, Kroger and the City of Santa Monica’s transit agency. “Redeem is the cleanest transportation fuel commercially available for heavy duty vehicles in the U.S. today,” Clean Energy says.
“Demand for renewable natural gas is growing quickly and BP is pleased to expand our supply capability in this area,” BP supply and trading CEO Alan Haywood says in the Clean Energy announcement.
“BP,” he said, “is committed to supporting developments towards a lower carbon future and, working with Clean Energy, we believe we will be well-positioned to participate in the growth of this lower carbon fuel in the U.S.”
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Source: Clean Energy Fuels with Fleets & Fuels follow-up