Shell plc is moving to substantially increase its global portfolio of renewable natural gas (RNG) with a nearly $2 billion acquisition deal to acquire Europe’s largest biogas producer, Nature Energy Biogas A/S.
Nature Energy, based in Denmark, currently produces around 6.5 Bcf/y of RNG from agricultural, industrial and household waste at 14 operational plants. The firm also has a project pipeline of around 30 plants proposed in Europe and North America that could increase production to an estimated 9.2 Bcf/y by 2030.
Downstream Director Huibert Vigeveno said the acquisition could help Shell add a European production platform that could combine with its existing U.S. RNG investments as it aims to reach net-zero emissions by 2050.
“We will use this acquisition to build an integrated RNG value chain at global scale, at a time when energy transition policies and customer preferences are signaling strong growth in demand in the years ahead,” Vigeveno said.
Shell estimated the acquisition could close sometime in 1Q2023, pending regulatory approval.
Shell currently produces and markets RNG in North America, with one existing plant in Oregon and four currently under construction. Some of its largest current RNG customers are corporate trucking companies and marine industries, according to Shell.
Shell reported that the cost of the acquisition would be “absorbed within Shell’s current capital range” and its guidance for capital expenditures remains unchanged.
In a note on the deal, representatives for the company compared the acquisition and one announced in April as examples of its strategic investments in new business segments. Shell agreed to acquire Solenergi Power Private Ltd. and its renewable energy distribution companies in India for $1.55 billion.
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