Green Impact Partners, Amber Infrastructure ink RNG facility partnership deal
February 22, 2023
By Green Impact Partners
Green Impact Partners Inc. has selected Amber Infrastructure Group as a strategic partner on its GreenGas Colorado, Iowa RNG and Future Energy Park projects, representing up to $545 million in total investment for a 50 per cent project-level equity interest in each facility.
Based in London, with offices in North America, Europe and Australia, Amber Infrastructure is an infrastructure investor with over $8 billion in assets under management.
“We are very excited to announce this transformative transaction, moving forward with a leading infrastructure investment partner, that highlights the immense value of our net zero projects and development portfolio,” said Jesse Douglas, chief executive officer. “Securing this project-level funding will enable us to move forward with our development portfolio in an accretive way to our shareholders. This investment will help drive forward the construction of our flagship project – Future Energy Park – and Iowa RNG in 2023, while allowing GIP to continue to progress as many as five additional projects in its $3 billion project pipeline, that could produce up to 10 million MMBtu of carbon negative RNG over the next three to five years.”
“We are excited to partner with GIP to deliver projects that align with progressive government policy in the U.S. and Canada,” said Tom O’Shaughnessy of Amber Infrastructure. “We share a common purpose, our values are aligned, and we look forward to making an impact together through the deployment of low carbon projects at scale.”
50% sale of Future Energy Park and Iowa RNG for $485 million
Green Impact Partners Inc. and certain affiliates (GIP) and Amber Infrastructure LLC and certain affiliates have executed a strategic partnering agreement whereby Amber has agreed to purchase 50 per cent of the equity in Future Energy Park and Iowa RNG for aggregate consideration of up to $485 million, subject to certain conditions including, but not limited to, the completion of material project and partnership documents, the close of non-recourse project debt financing, minimum economic returns, and other customary conditions of transactions of this nature. The closing of the transaction is subject to receipt of TSX Venture Exchange approval. No finder’s fees were paid as it relates to the transaction.
Strategic funding partner for development portfolio
The strategic partnering agreement also outlines a framework for GIP and Amber to continue to partner on future opportunities over the next two years under similar terms and conditions by giving Amber a first right to provide equity if the parties mutually agree to investment terms.
“Since our inception in May 2021, we have deployed the $100 million of our initial equity raise and turned that into over 10 times in value today, and we have the people, projects, and capital to continue that trajectory,” said Jesse Douglas.
50% sale of GreenGas Colorado for $60 million
GIP and Amber have agreed to the terms of a unit purchase agreement whereby GIP will receive gross proceeds of US$43.9 million for the sale of 50 per cent of the equity it holds in GreenGas. The purchase price will be paid in two instalments with US$28.5 million paid upon close and US$15.5 million paid upon the potential future completion of a third-party sale of GreenGas Colorado investment tax credits (ITC). Closing is anticipated to occur on or about February 23, 2023. GIP expects to retain US$10 million to $15 million of the net proceeds from the third-party sale of ITCs with further upside of up to US$15 million depending on financial performance of GreenGas Colorado. The proceeds of the first instalment of the purchase price will be used to reduce the corporate revolver, to fund the remaining equity and working capital of GreenGas Colorado, and for general corporate purposes, including the advancement of our development pipeline. GIP will continue to be the operator and manage the facility. No finder’s fees were paid.
Commissioning is well underway at GreenGas, with first gas production imminent at the Colorado-based facility. To allow for a ramp-up period to full capacity, the facility is expected to generate 180,000 MMBtu of RNG for the balance of 2023, growing to over 360,000 MMBtu in run-rate production by year end 2023.Future Energy Park will be North America’s largest carbon negative facility. Located in the City of Calgary, GIP continues to advance permits and approvals and has substantially advanced all of the project offtake, supply, construction and engineering agreements. With an approximate capital investment of $1.2 billion, GIP anticipates starting construction in the first half of 2023. Construction at Iowa RNG is expected to start in the first half of 2023. GIP is finalizing material permits and approvals, detailed design, and the engineering, procurement, and construction, offtake, and interconnection agreements.
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