Capital partners sign on for California renewable diesel project

By Orion Energy Partners L.P. | June 04, 2020

Orion Energy Partners L.P., GCM Grosvenor and Voya Investment Management are pleased to announce a capital partnership with Bakersfield Renewable Fuels. 

BKRF is a special purpose vehicle wholly owned by Global Clean Energy Holdings Inc., which was created to purchase an existing refinery in Bakersfield, California.  BKRF will retool a portion of the refinery into a renewable diesel biorefinery.  The project will use GCE's proprietary camelina oil as well as traditional biofuel feedstocks such as waste fats, oils and greases to produce RD and other renewable products (liquid propane, naphtha).  RD is an established “drop in replacement” fuel for diesel, is 100 percent sustainable and can reduce greenhouse gas emissions by up to 80 percent when compared to conventional diesel.  The project's output will be sold under a long-term offtake agreement with a multinational oil major.

Design, engineering and construction is supported by a consortium of leaders in the downstream and renewable fuels industry. The primary work will be conducted by union trades through a local Bakersfield EPC contractor, ARB Inc., a Primoris Services Corp subsidiary.

"GCE is thrilled to partner with Orion Energy, GCM Grosvenor and Voya as we embark on this exciting new venture.  Despite challenging market conditions, with the support and creativity of our financing partners we will have the necessary resources to make the project a success and deliver meaningful economic and environmental benefits to the region," said Richard Palmer, CEO of Global Clean Energy Holdings.

"We are pleased to partner with GCM Grosvenor and Voya on this financing to support GCE," said Gerrit Nicholas, founder and managing partner at Orion Energy Partners. "This investment in a truly unique, independent, renewable refinery is a terrific example of Orion Energy's value proposition in providing creative and deeply structured financing solutions for environmentally innovative energy infrastructure."

"GCM Grosvenor is excited about this collaboration with Orion Energy and Voya to finance GCE's transformative renewable refinery, which will move us one step closer to a sustainable future," said Matthew Rinklin, managing director at GCM Grosvenor. "This transaction is a great example of our Labor Impact Strategy's ability to provide structured financing solutions and infrastructure development expertise in partnership with value-added union labor to help drive positive investment outcomes."

"Voya is thrilled to work with GCE, Orion, and GCM Grosvenor on this groundbreaking transaction, which is a perfect fit with Voya's recent expansion into the renewable energy and sustainable infrastructure space, adding to Voya's three decades of diversified infrastructure lending," said Tom Emmons, co-head, direct infrastructure/private credit.

Latham & Watkins LLP acted as legal counsel to Orion Energy.  Akin Gump Strauss Hauer & Feld LLP acted as legal counsel to GCM Grosvenor and Voya.  King & Spalding acted as legal counsel to GCE and TroyGould acted as acquisition counsel and corporate counsel to GCE.