SHV Energy and UGI International announced this Tuesday that they are teaming up in a joint venture that will further develop renewable and sustainable solutions for the liquified petroleum gas (LPG) industry.
Firstly, the joint venture intends to promote and produce Renewable Dimethyl Ether (rDME), which is a low-carbon sustainable liquid gas, that can support de-fossilization of transport, domestic and industrial heating and cooking.
In fact, it is a single molecule, chemically similar to propane and butane, produced from multiple renewable feedstocks including waste streams and residues. In comparison with other fossil fuel-based solutions; it has an 85% GHG emission reduction. Also, it can be easily transported as a liquid in pressurized cylinders and tanks.
Moreover, it can be easily blended with propane, LPG or BioLPG; consequently, the rDME can help propane approach carbon neutrality.
As a result, SHV Energy and UGI will join together to develop up to 6 production plants of this gas, for the next five years. They’ll have a total production capacity of 300 kilotons of rDME per year by 2027. Also, the companies advance an average of $1 billion investment. This would include investment from third parties.
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SHV Energy and UGI will break grounds on new solution for the transportation sector
Moreover, SHV Energy and UGI will have equal stakes at the joint venture. Overall, it will bring scale and critical mass to the rDME market; particularly, through the development of business opportunities, investments and so on.
Therefore, the joint venture will focus on the promotion of the use of rDME, the development of new technologies for its use; as well as infrastructure, pushing of regulations, and also standards for its safe use.
On the other hand, Bram Gräber, Chief Executive Officer at SHV Energy, said. “De-fossilization is pivotal for our industry. Liquid gas is an important, clean and efficient energy source used in over 1000 different applications by millions of people around the world.”
He also added. “Finding accessible, sustainable and affordable feedstock to produce alternative liquid renewable gas is a high priority for the LPG industry. We are convinced that rDME ticks all the boxes to be a gamechanger for our industry.”
Finally, Roger Perreault, Executive VP Global LPG of UGI Corporation, and its upcoming new CEO, said. “We are convinced rDME will help LPG down the path of de-fossilization across jurisdictions. We are excited to announce this joint venture proposal; and also be able to contribute to a more sustainable future for our industry and customers.”
