Marathon lands stake in US biogas producer
LF Bioenergy's target is to produce 6,5000 mmBtu of biogas per day by the end of 2026.By Joseph Murphy
Marathon Petroleum (MPC) has acquired a 49.9% interest in US renewable natural gas (RNG) producer LF Bioenergy from Cresta Fund Management for $50mn, it announced on March 8.
LF Bioenergy is developing dairy farm-based RNG, with its current projects at various stages of development. Its first facility is nearing completion and is due online in the first half of this year. MPC is set to fund its share of capital expenditure to grow the business, with the aim of producing more than 6,500 mmBtu per day of biogas by the end of 2026.
MPC will pay an additional $50mn for the interest depending on whether pre-determined earn-out targets are met.
"This RNG transaction demonstrates our commitment to lower carbon investments," said Dave Heppner, MPC's senior vice president of strategy and business development. "This platform will create the opportunity for further integration and advances MPC's goal to lower the carbon intensity of its operations and the products it offers."