Canada-based Enerkem, a producer of low-carbon intensity biofuels and circular chemicals from waste materials, today announced the closing of a new funding round, raising a total of CAN$255 million (€187 million).
Next to contributions from existing shareholders, including strategic investor Suncor Energy and Avenue Capital Group, which has reinvested €22 million, this new financing round also attracted two new investors: Repsol and Monarch Alternative Capital.
Repsol is a global multi-energy company with operations in 24 countries. The company has invested €122 million, of which €54 million is in Enerkem’s equity and €68 million in convertible debt, allowing it to increase its stake in accordance with a number of financial variables over the coming years. The investment is in line with its strategic focus on decarbonisation and circularity to achieve its goal of becoming a zero net emission company by 2050. Repsol will also have a seat on Enerkem's Board of Directors.
Monarch Alternative Capital, an investment firm with approximately US$9.5 billion of assets under management, is a new €22 million investor in Enerkem, attracted by the potential of Enerkem’s technology to have a tangible impact on greenhouse gas reduction.
“We are privileged to have high-calibre international investors supporting our vision and the deployment of our disruptive technology,” said Dominique Boies, Enerkem’s CEO.
Repsol’s investment in the Canadian company follows last year’s announcement of the partnership with Agbar, a global expert in water and waste management, and Enerkem to build a waste-to-chemicals plant in Tarragona, Spain. The joint venture, called Ecoplanta Molecular Recycling Solutions, is constructing a new plant that will process some 400,000 tonnes of non-recyclable solid waste per year and produce close to 240,000 tonnes of methanol. Completion is targeted for 2026. The plant is the first of its kind on the Iberian Peninsula. It will be co-managed by Repsol and Agbar, whilst Enerkem will be the key technological partner. Based on the European Commission’s Innovation Fund methodology, the project will achieve 3.4 Mt CO2eq of greenhouse gas (GHG) emission reductions over the first ten years of operation. Among over 300 projects submitted by major European industrial groups last year, Ecoplanta Molecular Solutions was one of seven projects selected for financial support from the European Commission, with a confirmed grant of up to €106 million.
Repsol sees other potential benefits as well. “Enerkem has several projects in different stages of development that will help Repsol accelerate its circular economy initiatives and open up new paths for production of low-carbon fuels, synthetic fuels, and renewable chemical products,” said Juan Abascal, executive director for Industrial Transformation and Circular Economy for Repsol.
Repsol has had a circular economy strategy in place since 2016, which extends throughout the company’s value chain, from obtaining raw materials to marketing products and services. In 2019, Repsol was the first oil and gas company to set a goal of achieving zero net emissions by 2050. It is transforming its industrial complexes into multi-energy hubs capable of converting waste and other renewable raw materials into products with a low, zero, or even a negative carbon footprint. The company is investing in circular economy, energy efficiency, renewable hydrogen, and CO2 capture and use technologies as the main strategic pillars to achieve this. It has also set itself the goal of recycling the equivalent of 20% of its polyolefin production by 2030.