Shell, through its fully-owned subsidiary Shell Petroleum, will acquire Nature Energy Biogas, a Danish producer of renewable natural gas (RNG), for a price of around $2bn.
The biogas producer will be acquired from a consortium of institutional investors, featuring Davidson Kempner Capital Management, Pioneer Point Partners, and Sampension, together called the NGF Partnership.
Founded in 1979, Nature Energy Biogas produces RNG from agricultural, household, and industrial wastes.
Having started off as a natural gas distributor, the Danish firm installed its first biogas plant in 2015 in Denmark. Currently, it has 14 industrial scale biomethane plants with related infrastructure, feedstock arrangements.
The 2022 production of Nature Energy Biogas is nearly 3,000 barrels of oil equivalent per day (boe/d).
Furthermore, Nature Energy Biogas has a pipeline of close to 30 new plants to be established in Europe and North America.
More than one-third of these RNG projects are in medium to late development stage in Denmark, France, and the Netherlands, and could produce up to 4,400boe/d by 2030.
Nature Energy Biogas board chair Jesper Lok said: “Under the stewardship of the NGF Partnership, Nature Energy has grown into a leading producer of biomethane from organic waste and has pioneered a standardised large-scale commercial production process in Denmark that creates higher on-farm crop yields.
“Under the new ownership of Shell, our team will continue to advance its unique vision of unlocking additional valuable resources from waste materials while offering secure and affordable energy to customers and promoting a circular economy.”
For Shell, the acquisition will further boost its ability to work with its established customer base across various sectors to expedite its shift to net-zero emissions. Besides, it will underpin the company’s goal to profitably increase its low carbon fuels production and offering in its customer-facing marketing business.
Shell downstream director Huibert Vigeveno said: “Shell’s competitiveness in low carbon fuels derives from capabilities across the value chain, combining a world-class Trading and Supply organisation with access to differentiated technology and production assets.
“Acquiring Nature Energy will add a European production platform and growth pipeline to Shell’s existing RNG projects in the United States.
“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 signalling strong growth in demand in the years ahead.”
The deal, which is subject to regulatory approvals, is anticipated to close in the first quarter of 2023.
