Oct 19, 2022 - Economy

Shell bids for Nature Energy, as biogas deals heat up

Illustration of a hand painting a gas tank green.

Illustration: Shoshana Gordon/Axios

Oil giant Shell has progressed to the second round of bidding for Danish biogas producer Nature Energy, which is being sold by a private equity consortium for around $2 billion, per Reuters.

Why it matters: Fossil fuel companies plan to buy their way into the energy transition, as renewable natural gas is generally compatible with existing infrastructure.

  • Earlier this week, BP agreed to acquire Houston-based biogas producer Archaea Energy for $4.1 billion, in a massive win for the SPAC that bought Archaea just last year for $1.15 billion.

Cap table: Nature Energy owners include Pioneer Point Partners, Davidson Kempner and Sampension.

The bottom line: Biogas can provide meaningful carbon reduction, particularly when it's made from waste such as landfills and food scraps, instead of crops specifically grown for fuel. However, methane leaks remain an issue."

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