Enerkem closes CAD$255 million financing round, gains Repsol as shareholder

Canadian firm Enerkem Inc. announced April 6 that it has closed a new round of financing totaling CAD$255 million (USD$203 million) to help drive growth and deployment of its gasification technology. Madrid, Spain-based energy company Repsol has invested CAD$170 million, of which CAD$75 million is in Enerkem’s equity and CAD$95 million in convertible debt. As a result, Repsol joins existing shareholder Suncor Energy as a strategic shareholder to accelerate the adoption and deployment of Enerkem's technology, and to develop new projects on the Iberian Peninsula.

In addition, Monarch Alternative Capital, a new investor, is contributing CAD$30 million to the round while Avenue Capital Group is reinvesting CAD$30 million, both in convertible debt. Finally, there is CAD$25 million reinvested in equity by some existing shareholders.

Since last year, Repsol has partnered with Enerkem and Agbar to build Ecoplanta Molecular Solutions in El Morrell, near Tarragona, Spain. The plant, scheduled to be operational in 2026, will use Enerkem's technology to process some 400,000 metric tons of nonrecyclable solid waste per year and produce 80 million gallons of methanol per year. Among more than 300 projects submitted by major European industrial groups last year, Ecoplanta Molecular Solutions was one of seven projects selected for financial support from the European Commission, with a confirmed grant of up to 106 million euros (USD$116 million).

“We are pleased to welcome Repsol as a shareholder,” said Dominique Boies, CEO of Enerkem. “Repsol is a global multi-energy supplier that will greatly assist in accelerating the deployment of our technology in new markets. Repsol’s equity investment in Enerkem strengthens our position as a leader in the renewable fuels and chemicals sectors and in building a circular economy.”

Juan Abascal with Repsol added, “At Repsol, we are truly proud to become a shareholder in Enerkem thus supporting its development to consolidate as a leader in waste gasification technology to produce renewable fuels and chemicals. We anticipate that its cutting-edge technology, recently recognized by the EU Innovation Fund, will be key to the decarbonization and circularity of the chemical and fuel industry. Enerkem has several projects in different stages of development that will help Repsol accelerate its circular economy initiatives and open new paths for production of low-carbon fuels, synthetic fuels, and renewable chemical products.”

On Monarch Alternative Capital’s new investment, Joseph Citarrella, managing principal, said, “We believe Enerkem’s team and technology are uniquely positioned to provide a compelling, scalable solution to some of the world’s hardest to decarbonize sectors. Through our experience in and focus on reducing the carbon footprint of fuels and chemicals, we are delighted to partner with Enerkem and its investors to advance its important strategic objectives.”

As an investor in Enerkem since 2020, Avenue Capital Group, through the Avenue Sustainable Solutions Fund, is reinvesting more than CAD$30 million. “Enerkem continues to be a natural fit with our mission to drive measurable environmental impact,” said John Larkin with Avenue Capital Group. “We are excited to continue to back Enerkem’s vision of decarbonizing industrial chemicals while offering a solution to municipal solid waste. Both are critical solutions in a sustainable future.”

These new investors complement the support of existing Enerkem investors such as Rho Ventures, Braemar Energy Ventures, Investissement Québec, Cycle Capital, Fonds de solidarité FTQ, Fondaction and Suncor Energy.

“We are privileged to have high-caliber international investors supporting our vision and the deployment of our disruptive technology,” Boies said. “These endorsements confirm the added value of our technology in the efficient and sustainable management of residual waste and forest biomass, transforming them into circular chemicals and advanced biofuels for road, air and sea transportation. In this way, we will contribute to decarbonizing sectors of activity that have a large environmental footprint. The geographic expansion of our investor base will help position Enerkem as a leading provider of technology to improve the global environment. We hope that this financing round will have a significant ripple effect on other Quebec and Canadian investors to stimulate innovative clean technologies.”

J.P. Morgan Securities LLC served as exclusive placement agent to Enerkem in connection with the financing.