Citi Alternative Investments & Dow Chemical Co-Lead GreatPoint Energy $100 Million Capital Raise
Company Secures One of the Largest Clean Tech Venture Capital Rounds Ever Completed
Cambridge, MA – GreatPoint Energy, Inc., the leading developer of catalytic gasification technology to convert coal, petroleum coke and biomass into clean natural gas while enabling the capture and sequestration of CO2, today announced the financial closing of a $100 million strategic equity round. The round was co-led by Sustainable Development Investments (SDI), a unit of Citi Alternative Investments (a division of Citi) and The Dow Chemical Company, and included the AES Corporation, Suncor Energy, Inc. and other financial firms. According to New Energy Finance, a leading provider of research to investors in clean energy, Greatpoint Energy’s capital raise represents the largest Series C financing to date, and one of the largest overall clean tech venture deals ever completed. GreatPoint Energy will use the funds to construct and operate a large-scale demonstration facility and soon thereafter will build, own and operate commercial natural gas manufacturing plants.
“We believe that this investment round validates our proprietary gasification process as the most cost-effective means of transforming widely abundant and low cost resources into the cleanest commercial fuel, natural gas, and furthers our position as the most innovative energy technology company in the industry,” said Andrew Perlman, President and CEO of GreatPoint Energy. “With natural gas increasingly in short supply and long term gas prices continuing to rise, GreatPoint Energy is well-positioned to competitively produce this clean resource domestically, while reducing greenhouse gas emissions and air pollution on a scale larger than any other commercial energy option.”
Jim Plonka, Vice President of Dow Venture Capital, commented, “As Dow advances its strategic growth agenda, it becomes critical to access a diversified, competitive supply of feedstocks and energy, including innovative alternatives with a more favorable environmental profile. We believe GreatPoint Energy’s technology has the potential to play a role in helping us to achieve that goal, and we are pleased to have the opportunity to invest in the development and commercialization of this opportunity.”
“GreatPoint Energy’s leading technology can help address climate change in an efficient and affordable way. We are pleased to have co-led this round with Dow and believe that this company represents a positive advance in the utilization of coal by creating a pure and sequestration-ready stream of CO2 for use in applications such as enhanced oil recovery,” said R. Andrew de Pass, Head of Citi’s Sustainable Development Investments group.
The strategic financing round includes a range of companies that GreatPoint Energy expects to work closely with during the scale-up, development, construction and operation of large scale natural gas manufacturing facilities. In addition to Dow, both the AES Corporation, one of the premier global power companies, and Suncor Energy Inc., a major North American energy producer and marketer and a world leader in synthetic fuel production from oil sands, participated in the round. Their representatives will each assume a position on GreatPoint Energy’s Board of Directors.
Daniel Goldman, GreatPoint Energy’s Chief Financial Officer added, “Building on the strength of our existing shareholders, we are pleased to have forged relationships with such a strong group of new strategic and financial investors and look forward to working with them as we commercialize the technology. This is a major step toward implementing our strategy of becoming a premier technology-driven natural resources company.” GreatPoint Energy’s existing investors, Kleiner Perkins Caufield & Byers, Khosla Ventures, Advanced Technology Ventures and Draper Fisher Jurvetson, also participated in the round.
GreatPoint Energy’s catalytic gasification technology converts abundant, low cost carbon feedstocks, such as coal, petroleum coke, and biomass, into pipeline quality natural gas. GreatPoint’s plants combine steam and carbon under pressure and in the presence of its catalysts to make pure methane, known generally as natural gas. Natural gas is the cleanest of all commercial fuels, provides roughly 25% of all U.S. energy needs, and consists primarily of hydrogen. Over the past five years, the price of natural gas in America has risen significantly as domestic resources deplete and the nation becomes increasingly dependent on foreign imports.
As part of its proprietary process, GreatPoint removes and captures the mercury, sulfur, carbon dioxide and other pollutants from the feedstock, to produce a pure stream of methane. GreatPoint Energy’s synthetic natural gas, called Bluegas, is as clean as natural gas and can be used directly in place of natural gas for all applications, including power generation, residential and commercial heating, and production of chemicals. GreatPoint plans to construct Bluegas facilities in locations where the carbon dioxide it captures can be locally sequestered, and then transport its Bluegas product by existing natural gas pipelines to natural gas markets across the country. Unlike GreatPoint Energy, other coal gasification technologies that produce synthesis gas (which consists of carbon monoxide and hydrogen) cannot take advantage of the nation’s existing natural gas pipeline and distribution network.
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