In the United States (US), South Jersey Industries, Inc., an energy services holding company based in Folsom, New Jersey (NJ), has revealed that it has acquired a minority interest in REV LNG, LLC (REV), a company specializing in the development and transportation of renewable natural gas (RNG), liquified natural gas (LNG) and compressed natural gas (CNG) in North America.
In December 2020, SJI acquired a minority interest in REV LNG, LLC (REV), along with the rights to develop anaerobic digesters at a portfolio of dairy farms to produce RNG.
The total consideration under the agreement is US$39.8 million, inclusive of minority interest, RNG development rights from a portfolio of dairy farms, capital contributions, and transaction costs.
It also provides SJI the option to purchase the remaining outstanding equity of REV as the company achieves financial milestones.
The agreement, for which no regulatory approvals were required for the transaction, was completed in December 2020.
Developing RNG portfolio
Headquartered in Ulysses, Pennsylvania (PA), REV specializes in the development, production, and transportation of renewable natural gas (RNG), liquefied natural gas (LNG), and compressed natural gas (CNG) in North America.
It also specializes in LNG/CNG turn-key supply solutions in a “Virtual Pipeline” arrangement.
In recent years the firm has become one of the country’s leading developers of RNG projects through capturing, cleaning, and upgrading biogas to RNG.
REV acquires the rights to build anaerobic digesters on dairy farms to produce RNG for injection into natural gas pipelines. It then sources, supplies and transports RNG to utilities through ownership of mobile tankers, decompression and vaporization assets to ensure safe, firm, and dependable service.
Under the agreement, SJI acquired four dairy farm renewable natural gas (RNG) projects, which equates to approximately 0.5M MMBtu of RNG annually.
Furthermore, SJI has an exclusive option – Right of First Offer (ROFO) – to purchase development rights for an additional 21 farms, which equates to approximately 1.6 million MMBtu of RNG annually.
The company is not obligated to make investments in anaerobic digesters but retains the option to do so.
