DG Fuels completes key financing milestone for Louisiana wood-to-SAF project
DG Fuels LLC, a developer of sustainable aviation fuel (SAF) projects, announced July 25 the successful closing of investment transactions with two important Japanese companies.
With the investments in DG Fuels made by Aviner & Co. Inc., Chishima Real Estate Co. Ltd. and an undisclosed investor, DG Fuels has now exceeded its minimum investment target as part of its final round of parent-level development capital needed to fund the remaining expected expenses required to reach a final investment decision (FID), including the ongoing FEL 3 (front-end engineering design) and related expenses.
The relatively modest balance of the maximum $30 million capital raise is expected to fund in the next few months.
DG Fuels currently expects that FID on its proposed $4.2 billion, 180-million-gallon-per-year SAF facility in Louisiana to occur in early 2024.
The Louisiana SAF facility will be the template for multiple other such facilities to be built across North America, Europe and Asia, the company stated.
“We believe the SAF to be produced by DG Fuels makes a significant contribution to reducing CO2 emissions in the aviation industry,” said Yoshiyuki Shibakawa, the representative director of Chishima. “Through the partnership with DG Fuels, we will contribute to the decarbonization of the aviation industry.”
Aviner, which is active in aircraft management and renewables, has worked closely with DG Fuels as its strategic partner and representative in Japan and broader Asia to market DG Fuels’ SAF product to offtakers in the Asia-Pacific region as well as jointly studying potential production of SAF by DG Fuels in the region.
“SAF sits right in between aviation and energy, which are the prime focus of ours,” said Hideyuki Yamanaka, CEO of Aviner. “We have strong belief in the DG Fuels team and are excited to be part of this project. SAF produced by DG Fuels’ high carbon conversion efficiency technology uses woody-biomass feedstock, which will not face limitation in feedstock supply, and we expect DG Fuels’ technology and know-how can be replicated in various locations around the world.”
Michael C. Darcy, CEO of DG Fuels, said, “The DG Fuels facility will produce 180 million gallons of zero carbon-emissions SAF. The facility itself has very minor atmospheric emissions and zero water discharge to the local environment and will bring 600 new permanent operating jobs and up to 2,100 construction jobs over three years to the local community.”
Christopher J. Chaput, president and chief financial officer of DG Fuels, added, “We have worked diligently with our investors in implementing this long-term relationship to mutually focus on decarbonizing the aviation sector in a responsible manner. The DG Fuels SAF product relies on no feedstock that would negatively impact the food supply and our highly efficient production process allows us to profitably sell SAF to airlines at attractive prices.”
