Gevo has entered into a binding renewable hydrocarbons (drop-in biofuels) purchase and sales agreement with Trafigura Trading, a wholly-owned subsidiary of Trafigura Group Pte.
The agreement is a long-term, take-or-pay contract and is the largest contract in Gevo’s history. Trafigura is a major independent commodity trading company with over $171 billion (€144 billion) and more than $54 billion (€45.7 billion) in revenue and assets, respectively.
Under this contract, Trafigura is expected to take delivery of 25 MPGY of renewable hydrocarbons the majority of which is expected to be low-carbon premium petrol with a smaller portion of the volume for sustainable aviation fuel (SAF), starting in 2023.
The commitment will support Trafigura’s efforts to develop the market for low-carbon fuels including low-carbon premium petrol. The agreement will also enable Trafigura to supply SAF to both US and international customers whose interest is growing in low-carbon jet fuel.
Patrick Gruber, CEO of Gevo, said: “This is our largest single contract to date, and with it, brings Gevo to over $1.5 billion (€1.26 billion) of revenue in long-term contracts when added to the other contracts we have in place.
“As drop-in fuels, Gevo’s renewable, very high-octane gasoline, and SAF are a perfect fit with Trafigura’s existing fuels business and will allow them to integrate these low-carbon options seamlessly into their supply chains.
“We expect that our low-carbon fuels will enable certain of Trafigura’s customers to substantially lower their carbon footprint.”
“Today’s agreement is a natural fit between our companies that will help drive the expansion of our renewable fuels product offering,” commented Robert Kreider, head of the strategic management and development group, North America, for Trafigura.
“We look forward to continuing to make a positive impact on the transition towards a low-carbon economy.”
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