ExxonMobil to invest $125 million in renewable diesel firm GCEH with 25% equity-stake option
Updated: Feb 15, 2022
Global Clean Energy Holdings Inc. is advancing its renewable diesel production through an agreement with ExxonMobil, which will invest $125 million with an option to acquire up to a 25 percent equity stake in the company. The investment, outlined in filings with the Securities and Exchange Commission, will help Global Clean Energy Holdings grow its proprietary camelina business in key farming regions in the U.S. and accelerate expansion into Europe and South America.
“This strategic investment by ExxonMobil is transformational for GCEH and will enable the rapid expansion of our proprietary camelina business,” said Richard Palmer, CEO of Global Clean Energy Holdings. “It also demonstrates the long-term commitment of both organizations to develop ultra-low carbon, nonfood-based feedstocks and advanced biofuels. Throughout our four years working together, ExxonMobil has actively supported our feedstock-deployment efforts in multiple U.S. growth regions.”
GCEH’s Sustainable Oils subsidiary is the leading global producer of camelina, a fast-growing, nonfood oilseed crop planted during fallow rotations by farmers without impact to their primary crops. Based on analysis of California Air Resources Board data, renewable diesel from various nonpetroleum feedstocks can reduce life-cycle greenhouse gas emissions by approximately 40 to 80 percent compared to petroleum-based diesel used in engines on the road today.
“We are investing in a number of technologies and initiatives that can reduce greenhouse gas emissions from vital sectors of the global economy, and are progressing lower-emission fuels to help industries like heavy transportation, marine and aviation,” said Ian Carr, president of ExxonMobil Fuels and Lubricants Co. “Our agreement with GCEH is an example of how we are leveraging our significant resources, technology and capabilities to deliver more renewable fuels to help customers reduce their emissions.”
GCE has an existing commercial agreement with ExxonMobil for more than 4 million barrels (168 million gallons) of drop-in renewable diesel from GCEH’s California biorefinery, which is on track to begin production later this year.
GCEH was represented by investment banks Stifel and Raymond James; financial advisor Ocean Park, and King & Spalding LLP acted as outside counsel. The investment was executed Feb. 2, with an expected financial closing by the end of February. The investment includes an additional $40 million in equity and debt by GCEH’s existing lenders led by Orion Infrastructure Capital for a total investment of $165 million.