Gevo Inc (NASDAQ:GEVO) said Thursday that it has hired Citigroup Global Markets Inc to secure financing for its operations, especially the expansion of its production capabilities to supply renewable isooctane and sustainable aviation jet fuel to Delta Air Lines Inc (NYSE:DAL) and HCS Group GmbH.
In December, Gevo announced that Delta Air Lines will purchase 10 million gallons of its advanced renewable biofuels per year once the company has completed expansions at its advanced biofuels production facility in Luverne, Minnesota.
Gevo also produces renewable isooctane and sustainable aviation fuel at its South Hampton facility in Silsbee, Texas.
All told, Gevo has roughly $500 million worth of take-or-pay-offtake agreements in place for a combination of renewable jet fuel and renewable isooctane for gasoline.
In 2020, the company plans to secure long-term financing to construct one or more expanded production facilities to produce its low-carbon hydrocarbon products for Delta and others.
In a statement, Gevo CEO Pat Gruber said that the company’s projects made “good economic sense” based on the contracts it had in place, and the great demand it saw in the future.
“As we raise capital, we will be looking at all strategic options, too,” said Gruber.
“We believe that Citigroup, as a leading investment bank, has a history of assisting companies in financings of the type we need for our capacity buildouts,” he added.
Gevo is commercializing the next generation of gasoline, jet fuel and diesel fuel with the potential to achieve zero carbon emissions, addressing the market need to reduce greenhouse gas emissions with sustainable alternatives.
The company is working to secure funding for the expansion, which is designed to allow Gevo to produce large quantities of low-carbon isobutanol, sustainable aviation fuel and renewable isooctane.
Contact the author Uttara Choudhury at [email protected]
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