VARO Energy Group (“VARO“) announces the acquisition of 80% of the shares in Bio Energy Coevorden BV (BEC) in The Netherlands, one of the largest biogas manufacturers in Europe. VARO is acquiring the shares from the existing shareholders, STAK Grisbe who will continue to own 15% of the business, and Van Drie Group, who will continue to own 5%. The transaction is expected to be completed in February.
- Developing the largest biogas manufacturing facility in Northern Europe: double the current facility capacity from 300 GWh to 650 GWh by 2026. After the expansion, the site will be among the 3 largest biogas facilities in Europe.
- High impact on GHG emissions:
- Feedstock from waste streams and manure, achieving 220,000 tonnes per year of CO2 reduction versus fossil natural gas
- Step towards achieving net zero scope 3 emissions by 2040 target
- Supports circular economy and new employment opportunities
- Accessing rapid growth market: ideally located on the border between The Netherlands and Germany, close to major industrial centers and large-scale agriculture offering both feedstock supply and demand growth. This investment will accelerate the energy transition in these leading countries.
- Highly efficient, cost competitive plant: BEC has built a successful industrial biogas facility, including state-of-the-art monitoring and control systems, heat optimization and recovery systems.
- Building integrated fuel value chain: leverages BEC’s large-scale manufacturing competencies with VARO’s integrated business model of energy sourcing, production, and exposure-management, while building one of the largest biogas manufacturing facilities in Europe.
- Supports energy security and energy transition: boosts energy security by diversifying Europe’s sources of supply while accelerating the energy transition by replacing conventional fuels with low carbon alternatives.
- Progress against VARO’s new strategy: meets 65% of VARO’s 2026 target of 1 TWh of biomethane / bio-LNG under its ONE VARO Transformation strategy launched in July 2022. The acquisition will have a substantial contribution of 20-25% of VARO’s Engine 2 (Renewable energies) EBITDA by 2026.
- Future Growth: this acquisition creates a platform for our future growth in the biogas industry in Europe
The transaction accelerates the ONE VARO Transformation strategy launched in July 2022. VARO recognises that a range of solutions and products are needed to help emitters to decarbonise and to protect Europe’s energy security. As part of the strategy, the company committed to becoming a leading producer of biogas in Europe, building its portfolio through both acquisition and greenfield developments.
Biogas has an important role to play in providing customers in harder–to-abate sectors such as heavy-duty transportation and shipping with a cost-competitive and low-carbon fuel supply. It also plays an important role in the decarbonisation of the agricultural sector and contributes to a circular economy,
As a result of this acquisition, the largest by VARO since 2015, and with VARO’s and BEC’s ongoing investment, the company is well placed to meet growth in European demand for both biomethane, which is expected to increase 3X by 2030 across Europe, and bio-LNG, which is expected to grow by 10X in Germany by the end of the decade.
Europe is an attractive market for biogas, benefitting from high domestic feedstock availability, as well as supportive Government policy and incentive structures. BEC’s established sourcing channels and world-class biogas production and construction expertise, combined with VARO’s existing feedstock sourcing, operations and trading capabilities create a strong platform to scale the biofuels business across Europe.
Commenting on the announcement Dev Sanyal, VARO CEO, said:
“Last year we set out our ambitious ONE VARO Transformation strategy to be the partner of choice for customers in the energy transition and to be net zero by 2040. Today’s announcement is a significant step towards accelerating our strategy by building a leading position in biogas in Europe.
“The combination of this platform along with VARO’s integrated business model will not only contribute to our strategic growth but will also be highly value accretive to VARO. Largescale biogas facilities have an important role in accelerating Europe’s energy transition – offering an alternative to conventional fuels at scale with emissions 90% lower than natural gas as well as allowing our refineries to replace their natural gas consumption with biomethane products with a lower carbon intensity. Growth in biogas will further support Europe’s energy security by diversifying supply.”
Christian Cuenot, VARO Vice President of Biogas, added:
“This transaction brings VARO closer to realising its target of 1 TWh/y of biogas production by 2026. It creates the largest biogas manufacturing facility in Northern Europe, located at the heart of one of the most concentrated industrial centres in the world offering easy access to high-demand growth. Abundant feedstock from agricultural waste in the region also provides a resilient and sustainable supply to the facility. I am looking forward to working with our new partners to deliver on the expansion of the current platform plant and continue to grow VARO’s biogas business.”
Notes to editors
BEC will be run on independent basis and Van Drie Group and STAK Grisbe (the Jacobs family) will hold respectively 5% and 15% post transaction.
Biogas is generated by breaking down agricultural waste, such as manure and other organic material, in specially built anaerobic digesters and waste facilities or landfill sites. The result of this process is the production of biogas (which would have otherwise been flared or vented) which is then further processed to produce biomethane/bio-LNG or is burnt to generate electricity. This biomethane can be used interchangeably with natural gas (including as transport fuel, in power generation and in industrial heating). However, as biogas is derived from organic waste its use results in much lower lifecycle greenhouse gas emissions.
Please refer to the infographic for more details.
For further information, please contact
VARO Media Relations
Phone: +41 79 546 66 31
Email: [email protected]
Will Medvei and Nabhan Malik
Phone: +44 (0)20 7404 5959
Email: [email protected]
VARO Energy (“VARO”) is the partner of choice for customers in the energy transition by providing the sustainable and reliable energy solutions that they need to reach Net Zero. Engine 1 activities include oil and gas manufacturing, storage, trading marketing and distribution. Engine 2 activities include biofuels, biomethane and bio-LNG, hydrogen, e-mobility, and carbon removals. VARO plans to invest around $3.5 billion over the 2022-26 period, with two-third committed to Engine 2. VARO is a private company, whose main shareholders are Carlyle International Energy Partners and Vitol.