Clean Energy Subsidiary Signs Long-Term Deal to Sell "Green" Gas from Its Texas Landfill Gas Operations
SEAL BEACH, Calif., Apr 06, 2009 (BUSINESS WIRE) -- Clean Energy Fuels Corp. (Nasdaq:CLNE), North America's leader in clean transportation, has signed a 15-year agreement through its subsidiary, Dallas Clean Energy, LLC, for the sale of renewable biomethane produced at the McCommas Bluff landfill in Dallas, Texas. Beginning in April 2009, the biomethane will be sold at fixed prices that increase in 2010 and 2011 and then remain fixed over the remainder of the agreement. The price for the "green" gas was not disclosed, but represents a significant premium to the prevailing price for conventional natural gas.
The agreement calls for the sale of up to 4500 MMBtus per day of biomethane from April 2009 through September 2010 and between 5000-6000 MMBtus per day of biomethane through March 2024. The actual volumes sold will depend on the gas recovery rates from the landfill and successful expansion of the gas processing facilities. Shell Energy North America will act as the purchaser and supply the biomethane to the end-user -- a utility that will use the biomethane in power generation to help meet applicable Renewable Portfolio Standards. Atmos Energy Corporation will provide intrastate transportation services from the gas processing plant.
"This gas sale agreement validates selling renewable biomethane as a valuable, low carbon fuel. It provides Clean Energy with a sound, long-term revenue stream and also supports expansion of the plant's production capacity for additional gas sales, including potential use as vehicle fuel," said Andrew J. Littlefair, Clean Energy president and CEO. "Many of our largest customers are showing interest in biomethane for their fleet vehicles as it is one of the best alternative fuels to meet new Low Carbon Fuel Standards coming in California and other states."
"We will retain the carbon credits related to the biomethane production and will pursue sales of those credits in the future," noted Littlefair.
The interstate "green" gas sale agreement is believed to be one of the largest such interstate sales of biomethane completed in the United States.
Clean Energy acquired a 70% ownership interest in Dallas Clean Energy in August 2008. The McCommas Bluff landfill gas operation owned by Dallas Clean Energy is one of the largest landfill gas operations in the United States. The landfill, owned by the City of Dallas, opened in 1975 and is scheduled to close in 2042. It is estimated that pipeline quality methane gas will continue to be produced for approximately 30 years after the landfill closes.
Clean Energy is the leading provider of natural gas (CNG and LNG) for transportation in North America. It has a broad customer base in the refuse, transit, ports, shuttle, taxi, trucking, airport and municipal fleet markets, fueling more than 15,000 vehicles at 176 strategic locations across the United States and Canada. Clean Energy owns and operates two LNG production plants, one in Willis, TX and one in Boron, CA, with combined capacity of 260,000 LNG gallons per day and designed to expand to 340,000 LNG gallons per day as demand increases. It also owns and operates a landfill gas processing facility in Dallas, TX that produces renewable biomethane gas for delivery in the nation's gas pipeline network. Please visit www.cleanenergyfuels.com
Forward-Looking Statements This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 that involve risks, uncertainties and assumptions, including statements about the projected volume of biomethane that will be sold under the gas sale agreement, the revenue that will be generated from the gas sales, the expansion of the gas processing facility and the potential gas recovery from the McCommas Bluff landfill. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of several factors including limited availability of financing to support plant expansion, any change in the composition or rates of trash disposal at the McCommas Bluff landfill, operating costs for the gas processing facility, the gas processing facility's capacity and the volume of landfill gas that is actually produced by the landfill. The forward-looking statements made herein speak only as of the date of this press release and the company undertakes no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.
SOURCE: Clean Energy Fuels Corp.
Clean Energy Fuels Corp.
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Bruce Russell, 310-559-4955 x101
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