Verde Clean Fuels receives $50-MM investment from Cottonmouth Ventures for the potential development of GTG plants in the Permian Basin (U.S.)
- Cottonmouth and Verde have entered into an agreement for a $50-MM equity investment through the purchase of 12.5 million shares of Verde Class A common stock by Cottonmouth at a purchase price of $4.00 per share
- Closing of the investment is anticipated to occur during Q1 2025, subject to satisfaction of customary closing conditions
- Proceeds from the investment are expected to be used to further the development and construction of potential natural gas-to-gasoline production plants in the Permian Basin and for other general corporate purposes
- The investment would increase Cottonmouth’s total investment in Verde to $70 million and Cottonmouth would become the second largest shareholder of Verde
- In connection with the investment, Verde will appoint a director and an observer, each designated by Cottonmouth, to Verde’s Board of Directors
Verde Clean Fuels announced the entry into a stock purchase agreement with Cottonmouth Ventures, LLC, a wholly-owned subsidiary of Diamondback Energy, for a $50 million equity investment by Cottonmouth into Verde. The investment consists of the purchase of 12.5 million shares of Verde’s Class A common stock at a purchase price of $4.00 per share. Closing of the investment is anticipated to occur during Q1 2025, subject to satisfaction of customary closing conditions. Upon closing, the investment would represent the second investment by Cottonmouth in Verde over the past two years, for a total investment of $70 million, making Cottonmouth the second largest shareholder of Verde.
“We are pleased to further our relationship with Diamondback and continue advancing our plans to deploy our technology through the development of commercial production plants. Diamondback is a strategic industry partner at the forefront of bringing sustainable operational practices to the oilfield and supporting the overall transition to clean energy. This investment is an expression of confidence in our technology, which we believe has the potential to alleviate economic and environmental concerns in the Permian Basin and other pipeline-constrained basins, where flaring and stranded natural gas represent a significant challenge,” said Ernest Miller, CEO of Verde.
Proceeds from the investment are expected to be used to further the development and construction of potential natural gas-to-gasoline production plants in the Permian Basin and for other general corporate purposes. The proposed plants to be jointly developed by the Parties would produce fully-refined gasoline utilizing Verde’s patented (STG+®) process from associated natural gas feedstock supplied from Diamondback's operations in the Permian Basin.
Effective at closing of the investment, Verde will expand its Board of Directors to eight members and appoint a new director to be designated by Cottonmouth. Cottonmouth will also be entitled to appoint an observer to the Company’s Board of Directors.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the securities referred to in this press release in any state or jurisdiction in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction. The offer and sale of the securities referred to in this press release have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), or any state securities laws, and unless so registered, may not be offered or sold in the United States except pursuant to an exemption from the registration requirements of the Securities Act and applicable state laws.
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