Chesapeake Energy Corp.'s new venture capital fund is getting off to a quick start, with more than $300 million in investments planned for two green energy
“We believe the long-term solution to America's economic and energy challenges will come from American natural resources combined with American ingenuity and innovation,” CEO Aubrey McClendon said.
Chesapeake will invest $150 million in newly issued convertible debt in Clean Energy Fuels Corp., a company co-founded by natural gas advocate T. Boone Pickens.
Clean Energy will use the money to accelerate its plans to build additional liquefied natural gas fueling stations for heavy-duty trucks, a key component of Pickens' plan to cut oil imports.
McClendon said Chesapeake's investment is expected to help underwrite the cost of about 150 new fueling stations, a tenfold increase in the number of public LNG stations.
“As confidence grows in the build-out of a national grid of CNG and LNG fueling infrastructure, we are confident that (original equipment manufacturers) of all vehicular classes will vastly increase their production of CNG and LNG vehicles,” he said. “Both businesses and consumers will then be able on a large scale to acquire these vehicles and embrace a cleaner, American fuel that costs about $1.50 to $2 per gallon less than gasoline and diesel.”
McClendon said further private sector investment in such fueling sites should provide the funding needed for a coast-to-coast and border-to-border build-out of CNG and LNG fueling stations.
Chesapeake also will spend $155 million to buy a 50 percent stake in Colorado-based biofuels company Sundrop Fuels Inc. Chesapeake's investment will be bolstered by $20 million from California-based venture capital firm Oak Investment Partners.
Sundrop is building the largest nonfood biomass-based “green gasoline” plant in the world, one that will be capable for turning natural gas and waste plant materials into more than 40 million gallons of clean gasoline each year.
“We can use any plant material,” Sundrop spokesman Steven Silvers said. “Anything from rice hulls to algae to wood bark.”
The plant is expected to be operational by late 2014. Full-scale commercial plants are expected to be as much as 10 times larger.
“The clean, abundant and affordable qualities of American shale natural gas are well-documented,” McClendon said. With Sundrop Fuels' efficient synthesis gasification process, natural gas becomes the enabling technology for a safer, stronger and greener economy.”