Aemetis signs terms of $ 100 million debt financing
By Aemetis Inc. | 23 November 2021
Aemetis Inc., a renewable fuels company focused on carbon-negative products, today announced that it has signed a non-binding term sheet and is working to complete new debt financing of $ 100 million. dollars from Third Eye Capital of Toronto, Canada. Debt financing is expected to include $ 50 million for carbon reduction projects and $ 50 million for working capital.
Aemetis has repaid over $ 55 million of its higher interest rate debt in 2021. New lower interest rate debt financing is expected to provide funding for Aemetis’ initiatives that reduce carbon intensity renewable fuels, including sustainable aviation fuel (SAF), renewable diesel, carbon sequestration and upgrades to the Keyes ethanol plant.
More than $ 32 million in cash and grants have already been invested in Phase I, 45 million gallons per year, the Carbon Zero renewable jets and diesel plant at Riverbank. This new loan facility is expected to provide the remaining project financing from Aemetis prior to the completion of the additional debt financing for the project. A guaranteed loan of USDA 125 million 9003 Biorefinery Assistance Program has been signed by Aemetis and an additional USD 100 million under the USDA Renewable Energy for America program is underway.
The base interest rate for financing the $ 50 million carbon reduction project will be 8% per annum. The base interest rate for the $ 50 million in working capital funding will be 10% per annum. Both credit facilities should have availability provisions based on the qualified use of funds and other factors. Additional consideration for the lender will include the usual fees for 500,000 warrants at an exercise price of $ 20 per share.
“This new financing builds on our successful relationship with Third Eye Capital, the Company’s primary lender since our first financing in 2008. We sincerely appreciate their continued support for carbon reduction projects and operations at Aemetis,” said Eric McAfee, President and CEO of Aemetis. . “This lower interest rate debt supports the development of the Aemetis Carbon Zero sustainable aviation fuel and 90 million gallon per year renewable diesel power plant, but also fully funds the remaining upgrades at the plant. Keyes to install solar power and MVR, as well as the two characterization wells for Aemetis Carbon Capture subsidiary to submit EPA Class VI CO2 sequestration licenses at our two biofuel plant sites.
Closing of the new debt financing is subject to customary closing conditions. The commitments under the new debt financing and its terms remain subject to finalization and execution of final documentation.
Aemetis has signed a 10-year, $ 1 billion, 250 million gallon supply agreement with Delta Air Lines to supply a mixture of 40% SAF and 60% jet fuel to the San Francisco airport. The sustainable aviation fuel is expected to be produced by the Aemetis renewable jet / diesel plant under development at a 125-acre former US Army munitions production site in Riverbank, California.
Powered by 100% renewable electricity, the design of the Aemetis Carbon Zero plant uses cellulosic hydrogen made from carbon negative wood waste. Subzero carbon intensity, cellulosic hydrogen is then used to hydrotreat vegetable oils or other renewable oils to produce aviation and diesel fuel. Process technology is licensed from Axens (France), a global technology provider for the petroleum and chemical industries.
To further reduce carbon intensity, Aemetis Carbon Zero’s production process includes injecting CO2 from the production plant into a sequestration well at the Riverbank plant site to continuously capture approximately 200,000 tonnes. metrics of CO2 per year.