Gevo, Inc. (NASDAQ: GEVO) (“Gevo” or the “Company”), a renewable
fuels company focused on the production of sustainable aviation
fuel (“SAF”), today provides an update on the Company and projects
currently in process.
Addition of New DirectorGevo recently announced
that its Board of Directors has appointed Carol Battershell as a
new independent director. Carol is a seasoned executive with nearly
40 years in the energy sector in the United States and
internationally. She is currently the Chief Executive Officer at
Battersea Energy LLC, an energy consulting company, and she
previously served as Principal Deputy Director in the Office of
Policy at the U.S. Department of Energy (“DOE”). In her ten years
with the DOE, Carol led multi-billion-dollar technical programs;
ran the Energy Efficiency and Renewable Energy field operations
office and was a key contributor to two multi-Agency energy policy
reviews. Prior to the DOE, Carol worked for 25 years in the energy
industry for BP where she held roles in operations management,
strategy development, financial management, and policy
development.
Net-Zero 1 StatusFollowing Gevo’s
groundbreaking ceremony in September 2022, progress continues at
the Lake Preston, South Dakota, Net-Zero 1 (“NZ1”) location. FEED
work is substantially complete and detailed engineering continues.
Equipment procurement is expected to begin soon and detailed
planning for this year’s construction ramp up has commenced. The
project remains on schedule for a 2025 operational startup.
Gevo recently selected a partner as its engineering,
procurement, and construction (“EPC”) contractor for NZ1. That firm
provides the expertise required for the Net-Zero plant design and
construction. This firm also offers deep experience in the energy
industry and a collaborative nature to work with the Gevo
engineering team in the design and buildout of the net-zero
production facility. Gevo is currently negotiating an EPC agreement
with this firm and will disclose more details when the contract is
finalized.
We are in discussions with multiple strategic and financial
entities that are interested in providing equity funding for a
portion of the NZ1 project. The progression of these discussions
and the debt raise process will guide the timing for financial
close and Final Investment Decision (“FID”) for NZ1, which we
expect to occur in the second half of 2023. Until financial close,
we will use our balance sheet to fund EPC activities. At the
invitation of the Department of Energy (“DOE”), we have submitted a
Part II application to the DOE’s Title 17 loan guarantee program
and have begun the DOE’s loan guarantee process. This process could
take several months as the DOE Loan Programs Office performs due
diligence on the project, structures the potential loan and
negotiates terms with Gevo prior to the loan closing process. The
timeline for this process is not within Gevo’s control; however,
the more favorable terms of these loans warrant pursuing a DOE loan
guarantee simultaneous with Gevo’s pursuit of non-recourse debt
with commercial debt fund lenders.
Progress on Key Development
MilestonesAccomplished Through year-end 2022:
- Close the purchase of the land for NZ1 in Lake Preston, South
Dakota
- Execute NZ1 Carbon Capture and Sequestration agreement
- Reach indicative terms on DBOOM development agreements for:
- NZ1 Wind energy
- Green hydrogen
- Select NZ1 engineering, procurement, and construction (“EPC”)
contractor
- Select NZ1 fabricator for hydrocarbon plant modules
- Substantial Completion of NZ1 Front-End Engineering Design
- Break ground and begin site preparation for NZ1 at Lake
Preston
Through year-end 2023:
- Begin ordering long lead equipment for NZ1
- Execute NZ1 lump-sum turnkey EPC contract
- Complete final negotiations with U.S. Department of Agriculture
and initiate Gevo’s Climate-Smart Farm-to-Flight grant with an
award ceiling of up to $30MM
- Begin receiving Low Carbon Fuel Standard (“LCFS”) credits for
renewable natural gas (“RNG”) production
- Close NZ1 construction financing, including non-recourse debt
and equity participation from one or more third parties
- FID for NZ1
- Finalize Net-Zero 2 location and partners
Throughout 2023, Gevo expects to update stockholders about
certain key milestones related to the development, financing, and
construction of NZ1 as well as subsequent Net-Zero plants. Updates
to those milestones will be found in the Company’s press releases
and investor presentations in the Investor Relations section of
Gevo’s website.
Additional Plant SitesGevo continues to make
steady progress on securing future SAF production locations beyond
NZ1. These future sites must offer an appealing mix of attributes
that enable the Company to produce low-cost fuels with the lowest
carbon footprint possible. Gevo has signed agreements and letters
of intent with multiple parties to secure access to several sites.
In addition to greenfield sites, we believe that there are several
existing ethanol plants that could be attractive for an
alcohol-to-jet (ATJ) plant that would be largely copied from
NZ1.
Renewable Natural Gas Project StatusGevo’s RNG
project in Northwest Iowa (the “RNG Project”) continues to ramp up
and stabilize production. Gevo will recognize a full quarter of
revenue for RNG sales in the fourth quarter of 2022; however, this
revenue will be limited to the value of the commodity sales for
much of the period. Revenue from Renewable Identification Number
(“RIN”) environmental benefits for a small portion of the quarter’s
gas production are expected as well. The full extent of the
available RIN and LCFS credits will begin contributing to revenue
at mid-year in 2023 due to timing of the approval and documentation
process for the LCFS credits.
Management CommentDr. Patrick Gruber, CEO of
Gevo commented, “We remain on track with our projects, and I am
very optimistic about the future of Gevo’s one billion gallons per
year goal of Net-Zero fuels. We have multiple attractive sites that
we are considering for Net-Zero 2 and beyond. Our process to raise
project financing is underway and going well. I believe that
momentum is going our way. For example, support for SAF is growing
not only at the federal level, but also at the state level. The
Illinois House and Senate recently passed SB 2951 which contains a
SAF incentive of $1.50 per gallon for airlines that purchase SAF.
The term of this incentive is for ten years beginning in June of
2023. This bill allows for the use of Argonne GREET inclusive of
agricultural practices and CCS to measure carbon intensity
score.”
Upcoming Investor ConferencesPresentations
provided in conjunction with these events will be available on
Gevo's website at www.gevo.com in the Investor Relations section on
the morning of the respective presentation. Members of Gevo’s
senior management will participate in the following hosted investor
events:
Credit-Suisse 28th
Annual Vail Summit– February 27 &
28, 2023, in Vail, Colorado
About Gevo Inc.
Gevo’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 lifecycle 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 lifecycle). 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 it possesses the
technology and know-how to convert various carbohydrate feedstocks
through a fermentation process into alcohols and then transform the
alcohols into renewable fuels and materials, through a combination
of its own technology, know-how, engineering, and licensing of
technology and engineering from Axens North America, Inc., which
yields the potential to generate project and corporate returns that
justify the build-out of a multi-billion-dollar business.
Gevo believes that Argonne National Laboratory GREET model is
the best available standard of scientific based measurement for
life cycle inventory or LCI.
Important Cautions Regarding Forward Looking
Statements
Certain 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, Gevo’s NZ1 project, including the timing of financing,
FID and other milestones for NZ1, Gevo’s other potential Net-Zero
projects, Gevo’s application to the DOE and the timing of the DOE
process, the RNG Project, including the timing of revenue and LCFS
credits for the project, Gevo’s business development activities,
Gevo’s ability to successfully develop, construct and finance its
projects, the finalization of an EPC contract, Gevo’s ability to
achieve cash flow from its planned projects, the Illinois SAF
incentive program, and other statements that are not purely
statements of historical fact. These forward-looking statements are
made based on 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, 2021, 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.
Company Contact:John Richardson (Director of
Investor Relations)Gevo, Inc.Tel: 720-360-7794E-mail:
jrichardson@gevo.com
Gevo (NASDAQ:GEVO)
Historical Stock Chart
From Jun 2024 to Jul 2024
Gevo (NASDAQ:GEVO)
Historical Stock Chart
From Jul 2023 to Jul 2024