Dallas-based private equity firm Grey Rock Investment Partners is making a controlling investment in Colorado-based CarbonCycle LLC via a capital commitment of up to $100 million.
Grey Rock said that it’s making the investment through its affiliated investment vehicles and that the money will fund additional growth of the company. Founded in 2013, Grey Rock seeks to make positive environmental impact investments.
Matt Miller, co-founder and managing director at Grey Rock, expressed enthusiasm about partnering with CarbonCycle, emphasizing the prospect of reducing a significant portion of the annual 56 million metric tonnes of CO2 emissions produced by over 450 U.S. natural gas processing facilities.
“We see a significant opportunity to mitigate carbon emissions and deliver healthy risk-adjusted returns for our partners,” Miller said.
Miller expressed confidence that CarbonCycle’s team is “well positioned” to collaborate with midstream companies and other industrial emitters to “attack this opportunity set.”
CarbonCycle said it plans to use the funds to develop Carbon Capture and Sequestration (CCS) projects, primarily focusing on natural gas processing facilities and other related industrial emitters.
CarbonCycle’s leadership team has a combined 100+ years of energy, engineering, and geological experience, with CEO Rich DiMichele’s career spanning more than 30 years in the energy industry, including extensive experience developing and operating midstream natural gas infrastructure.
Kent Bowker, EVP of subsurface, has more than 40 years of geology experience including as a pioneer in cracking the code for shale development with Mitchell Energy.
According to Grey Rock, the CarbonCycle team possesses the technical and project development experience to successfully develop world-class CCS projects.
Part of the net zero opportunities fund
Via its existing energy investments, Grey Rock said it has built a comprehensive in-house team with skill sets spanning all phases of energy development including subsurface geology, engineering, and land and title to support CarbonCycle in its project development efforts.
DiMichele says Grey Rock has an “exceptional track record,” adding that the firm is renowned for its creative approach and focus in managing valuable energy investments and transitioning into sustainable energy spaces.
CarbonCycle is now part of Grey Rock’s net zero opportunities fund alongside innovative companies like Vault, Conduit, and Rebellion. DiMichele sees CarbonCycle’s emphasis on CCS opportunities as a complementary addition that will augment the achievements of Grey Rock and its associated companies in the industrial sector.
Grey Rock said that CCS is the process of capturing CO2 emissions from industrial emitters and converting it into a liquid form that can be safely transported and sequestered underground permanently, reducing the amount of CO2 that would have otherwise entered the atmosphere without interrupting critical industrial operations.
Grey Rock said the use of CCS greatly reduces a facility’s carbon footprint and supports the global initiative to combat climate change.
Grey Rock Investment Partners has more than $1.3 billion in asset value across its private equity fund platform. It invests across the energy value chain with private equity funds focusing on investments in natural resources, carbon capture, industrial electrification, and power optimization.
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