Gevo and HCS Group enter long-term renewable isooctane supply deal
In the United States (US), advanced renewable fuel and biochemical manufacturer and platform technology developer Gevo, Inc. has announced that has entered into a long-term, definitive, binding and bankable renewable isooctane purchase and sale agreement with HCS Group. Under the terms of the deal, HCS Group will be supplied exclusively for sales of Gevo’s renewable isooctane into high-end applications ranging from high purity solvents to specialty fuels under its Haltermann Carless brand.
Agreed on February 21, 2019, the renewable isooctane supply deal for high-end products is worth up to US$180 million and it excludes the use of isooctane for on-road transportation fuels. Gevo’s renewable isooctane is a low-carbon, drop-in blending component for gasoline and has the potential to reduce greenhouse gases (GHG) by as much as 70 percent, well within the standards established by the EU Renewable Energy Directive.
Pursuant to the terms of the agreement, Gevo will supply low-carbon, renewable isooctane to HCS Group over ten years if certain conditions are met, including the expansion of Gevo’s isooctane production capabilities at its advanced biofuels production facility in Luverne.
According to Dr Patrick R. Gruber, Gevo’s Chief Executive Officer, this long-term, binding purchase, and sale agreement with HCS Group represents a significant milestone in Gevo’s “crusade to help leading consumer brands reduce greenhouse gas emissions” through decarbonizing transportation fuel.
Furthermore that it is an important step forward in Gevo’s previously-announced strategy to build out Gevo’s advanced biofuels production facility in Luverne, Minnesota, USA, to increase the production of renewable isobutanol and renewable jet fuel as well as isooctane.
This is a game-changing, bankable agreement for Gevo and another step forward to delivering on our promise to address the need for low-carbon fuels while also meeting sustainability requirements for our customers, to reduce their carbon footprint. This agreement strengthens our partnership with HCS Group that began with a prior agreement signed in 2017. Our technology and our renewable isooctane have proven themselves in highly demanding niche applications. We now want to scale substantially in order to enable rolling-out our renewable isooctane to a variety of high-end fuel and solvent applications, Dr Gruber said.
HCS Group is a leading global provider of solutions for high-value specialty hydrocarbons and is active in a broad range of markets, such as automotive, pharmaceutical and agrochemicals. HCS Group, with its key brand Haltermann Carless, operates a network of nine state-of-the-art facilities for refining, processing and blending in Germany, the UK, France and in the United States.
We have been impressed with the quality and the consistency of Gevo’s renewable isooctane, proving its value in the most demanding, high-end race fuel applications This long-term agreement and the capacity expansion enables us to satisfy a growing demand for our sustainable ECO products in mass markets driven by global, blue-chip accounts. We see strong interest for our advanced bio-based products in the outdoor power equipment and the cosmetics industries as well as in a wider range of fuel applications, said Dr Uwe Nickel, CEO of HCS Group.