NET Power and Rice Acquisition in $1.5bn combination
US low-carbon power producer NET Power LLC and Rice Acquisition, headed by former Rice Energy CEO Danny Rice, said December 14 they had reached a definitive agreement to enter into a business combination to accelerate commercial deployment of NET Power’s technology to deliver clean, reliable and low-cost power from natural gas.
The combined company, NET Power Inc, will have an enterprise value of $1.459bn and will be headed by Rice as CEO, replacing Ron DeGregorio, who will retire as CEO of Net Power LLC. The transaction is expected to close in Q2 2023.
“We have long believed that if you can use natural gas, generate reliable electricity, and capture the resulting emissions, you would change the world,” DeGregorio said. “For over a decade, NET Power has worked tirelessly to prove its game-changing technology, which we did through our demonstration facility in La Porte, Texas.”
On the heels of a strategic investment and partnership with Baker Hughes to provide key turbomachinery for future NET Power facilities, the transaction will “properly” capitalise NET Power and enable commercialisation of its technology.
NET Power’s proprietary process combines oxy-combustion (combustion of natural gas with pure oxygen) with a supercritical CO2 power generation cycle to generate electricity. The process inherently captures more than 97% of produced CO2 for sequestration or utilisation.
In early November, NET Power joined with US major Occidental to develop the first utility-scale NET Power facility, generating 300 MW of electricity and capturing 820,000 metric tons/year of CO2, at Oxy’s Permian Basin operations near Odessa, Texas.
“We are excited to support this transaction, which will further NET Power’s commercialisation plans and help achieve decarbonisation goals globally,” Oxy CEO Vicki Hollub said. “We first invested in NET Power because we believe the technology can accelerate Oxy’s efforts to reduce emissions in our existing operations and ultimately supply emissions-free power to the direct air capture (DAC) sites and sequestration hubs we are developing.”
Occidental is exploring the feasibility of incorporating NET Power technology into DAC hubs being developed by its subsidiary, 1PointFive, and Canadian DAC technology developer Carbon Engineering. The first of those facilities, to capture 500,000 mt/yr of CO2, is under construction in Texas, but ultimately 1PointFive could develop 30-40 plants to provide enough clean power for a DAC programme capturing 100-135mn mt/yr of CO2.