Two investment firms have scooped up the majority stake in JET, a subsidiary of Phillips 66 with a rapidly growing EV charging network. Photo via Jet.de Facebook.

Energy Equation Partners, a London-based investment firm focused on clean energy companies, and New York-based Stonepeak have completed the acquisition of a 65 percent interest in JET Tankstellen Deutschland GmbH, a subsidiary of Houston oil and gas giant Phillips 66.

JET is one of the largest and most popular fuel retailers in Germany and Austria with a rapidly growing EV charging network, according to a news release. It also operates approximately 970 service stations, convenience stores and car washes.

“We are delighted to complete this acquisition and to partner with Stonepeak and Phillips 66 to take JET to the next level,” Javed Ahmed, managing partner of Energy Equation Partners, said in a news release. “This investment reflects EEP’s commitment to investing in established players in the energy sector who have the potential to make a meaningful impact on the energy transition, and we are excited to work alongside the entire JET team, including its dedicated service station operators, to realize this vision.”

The deal values JET at approximately $2.8 billion. Phillips 66 will retain a 35 percent non-operated interest in JET and received about $1.6 billion in pre-tax proceeds.

“Under Phillips 66’s ownership, JET has grown into one of the largest fuel retailers in Germany and Austria," Anthony Borreca, senior managing director and co-head of energy at Stonepeak, added in a news release. "We are excited to join forces with them, as well as Javed and the EEP team, who have long-standing experience investing in and operating retail fuel distribution and logistics globally, to support the next phase of JET’s growth.”

Acquisitions, consolidations, divestitures — here's what news of energy transition deals in Houston trended this year. Photo via Getty Images

M&A moves: Most trending Houston energy transition news on big deals from 2024

year in review

Editor's note: As the year comes to a close, EnergyCapital is looking back at the year's top stories in Houston energy transition. From acquisitions to consolidations, this year marked a big one for some of Houston's energy companies. Here were the top five most-read articles covering deals of 2024 — be sure to click through to read the full story.

PE firm acquires Houston renewables fuels infrastructure company

Ara Partners announced this week that it has acquired a majority interest in Houston-based USD Clean Fuels. Image via Shutterstock.

Fresh off its $3 billion fund closure, a Houston private equity firm has made its latest acquisition.

Ara Partners announced this week that it has acquired a majority interest in Houston-based USD Clean Fuels, a developer of logistics infrastructure for renewable fuels. The terms of the deal were not disclosed.

"We have high conviction that the green molecules economy – whether it's renewable fuel feedstocks or biofuels – offers disproportionate opportunity for returns and impact," George Yong, partner and co-head of Infrastructure at Ara Partners, says. Continue reading.

McKinsey acquires Houston-area co. to enhance sustainability services

According to McKinsey data, more than $3.5 trillion will be invested in green hydrogen, carbon capture, renewable energy, and other projects that are working toward net-zero transition by 2050. Photo via ses-estimating.com

A global management consulting company has executed on an acquisition key to its plans amid the energy transition.

McKinsey & Company announced the acquisition of Strategic Estimating Systems, a Sugar Land-based consulting firm specializing in cost estimation for oil, gas, and chemical process industries. The acquisition provides McKinsey with enhanced benchmarking capabilities across capital project management — especially within the energy transition.

The terms of the deal were not disclosed.

"The capital projects ecosystem is presented with a once-in-a-generation chance to aid in transforming economies to achieve net zero," Justin Dahl, partner and global leader of McKinsey & Company's Capital Analytics, says. Continue reading.

Houston chemical company divests new tech arm to PE

Merichem Company has created a new business unit that's been acquired by a private equity firm. Photo via Getty Images

A New Orleans-based private equity firm has announced the acquisition of a Houston chemical company's technology business unit, the business announced today.

Black Bay Energy Capital acquired a portion of Merichem Company’s business — including its Merichem Process Technologies and Merichem Catalyst Products, which will collectively be renamed Merichem Technologies. Merichem's caustic services business, which handles spent caustic for beneficial reuse, will be maintained by the company.

Cyndie Fredrick has been promoted to CEO of Merichem Technologies. She previously served as Merichem's senior vice president and general manager of Merichem Process Technologies. She's joined by CFO Rene Campos, Senior Vice President of Technology Jeff Gomach, and Senior Vice President of Catalysts William Rouleau, who are all former managers within Merichem.

“The Merichem Technologies team has successfully deployed highly engineered and patented technologies, chemical catalysts, and mechanical solutions to various end markets including liquified natural gas, midstream oil and gas, refining of traditional crude and renewable feedstocks, biogas/landfill/RNG production, geothermal energy production, and chemical manufacturing," Fredrick says. Continue reading.

SLB to consolidate carbon capture business in partnership

The combined technology portfolios will accelerate the introduction of promising early-stage decarbonization technology. Photo via Getty Images

SLB announced its plans to combine its carbon capture business with Norway company, Aker Carbon Capture.

Upon completion of the transaction, which is expected to close by the end of the second quarter of this year, SLB will own 80 percent of the combined business and ACC will own 20 percent.

According to a SLB news release, the combined technology portfolios will accelerate the introduction of promising early-stage decarbonization technology.

“For CCUS to have the expected impact on supporting global net-zero ambitions, it will need to scale up 100-200 times in less than three decades,” Olivier Le Peuch, CEO of SLB, says. Continue reading.

Houston-based co. closes acquisition of 50 percent stake in Texas cogeneration facility

Fengate has completed the acquisition of a 50 percent stake in a Texas cogeneration facility, which supplies power and steam to a major industrial site. Photo via Fengate

Fengate Asset Management announced the financial close on the acquisition of a 50 percent interest in Freeport Power Limited, which owns a 440-megawatt cogeneration facility in Freeport, Texas.

FPL is located near the Freeport Energy Center, which is a 260-megawatt cogeneration facility that is currently owned and managed by Fengate. The two facilities work to provide cost-effective power and steam to Dow’s Freeport site, which is the largest integrated chemical manufacturing complex in the Western Hemisphere.

“We are thrilled to have closed this acquisition, which aligns with our strategy of acquiring behind-the-meter cogeneration projects with strong industrial partners like Dow,” Greg Calhoun, managing director of Infrastructure Investments at Fengate, says. Continue reading.

Ian Goldberg joins the Houston office of Akin. Photo via akingump.com

Law firm's Houston office expands energy expertise

new hire

Leading adviser to energy companies, Akin Gump Strauss Hauer & Feld, has announced a new energy transactions partner in the firm’s Houston office.

Ian Goldberg will advise clients on various energy transactions, which will include project development, mergers and acquisitions, divestitures, and financial transactions that will involve oil and gas assets, energy transition investments and rare earth mineral deposits.

He previously led the energy transactions practice at Hunton Andrews Kurth.

“Akin has a top-tier integrated platform across the entire energy value chain,” Goldberg says in a news release.” I’m excited to be joining a growing and dynamic team.”

He will be joining recent additions to Akin’s energy practice that include projects & energy transition partners Ike Emehelu (New York), Alex Harrison, Matt Hardwick and Dan Giemajner (London), energy regulatory partners Emily Mallen and Stephen Hug (Washington, D.C.), tax equity partner Sam Guthrie (Washington, D.C.) and projects & energy transition partner Vanessa Richelle Wilson (Washington, D.C.)..

“Ian adds depth to our energy team with extensive experience in the onshore and offshore upstream and midstream sectors, and his current representation of clients in the carbon capture, utilization & storage and hydrogen spaces further strengthens our growing projects & energy transition practice,” corporate practice co-head Zachary Wittenberg adds in the release.

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Constellation and Calpine's $26B clean energy megadeal clears final regulatory hurdle

big deal

Baltimore-based nuclear power company Constellation Energy Corp. received final regulatory clearance this month to acquire Houston-based Calpine Corp. for a net purchase price of $26.6 billion.

The acquisition has the potential to create America’s “largest clean energy provider,” the companies reported when the deal was first announced in January.

The Department of Justice approved the acquisition contingent on Calpine divesting several assets, including one in the Houston area.

The company agreed to divest the Jack Fusco Energy Center natural gas-fired combined cycle facility in Richmond, Texas; four generating assets in the Mid-Atlantic region; and other natural gas plants in Pennsylvania and Corpus Christi, Texas.

The Federal Energy Regulatory Commission, the Public Utility Commission of Texas and the New York Public Service Commission previously approved the deal. The companies can move toward closing the acquisition once the court finalizes the stipulation and order.

"We are very pleased to reach a settlement that allows us to bring together two magnificent companies to create a new Constellation with unprecedented scale, talent and capability to better serve our customers and communities while building the foundation for America’s next great era of growth and innovation," Joe Dominguez, president and CEO of Constellation, said in a news release. "We thank the Department for its professionalism and tireless work reviewing this transaction through these many months. It’s now time for us to complete the transaction, welcome our new colleagues from Calpine, and together begin our journey to light the way to a brilliant tomorrow for all."

Andrew Novotny, CEO of Calpine, will continue to lead the Calpine business and Constellation's fleet of natural gas, hydro, solar and wind generation, according to the company. He will report to Dominguez and also serve as senior executive vice president of Constellation Power Operations.

Constellation is considered one of the top clean energy producers in the U.S. Earlier this month, the company was approved to receive a $1 billion loan from the Department of Energy's Energy Dominance Financing Program to restart its 835-megawatt nuclear reactor in Pennsylvania known as Crane Clean Energy Center.

"Work to restart the reactor comes at a time of unprecedented electric demand growth from electrification and the new data centers needed to support a growing digital economy and to help America win the AI race," a news release from the company reads. "Crane will support grid stability by delivering reliable, around-the-clock electric supply."

States brace for Trump's push to make oil drilling cheap again

Energy news

A Republican push to make drilling cheaper on federal land is creating new fiscal pressure for states that depend on oil and gas revenue, most notably in New Mexico as it expands early childhood education and saves for the future.

The shift stems from the sweeping law President Donald Trump signed in July that rolls back the minimum federal royalty rate to 12.5%. That rate — the share of production value companies must pay to the government — held steady for a century under the 1920 Mineral Leasing Act. It was raised to 16.7% under the Biden administration in 2022.

Trump and Republicans in Congress say the rate reset will boost energy production, jobs and affordability as the administration clears the way for expanded drilling and mining on public lands.

States receive nearly half the money collected through federal royalties, depending on where production takes place. The environment and economics research group Resources for the Future estimates a roughly $6 billion drop in collections over the coming decade.

The stakes are highest in New Mexico, the largest recipient of federal mineral lease payments. The state could could forgo $1.7 billion by 2035 and as much as $5.1 billion by 2050, according to calculations by economist Brian Prest at Resources for the Future.

More than one-third of the general fund budget in the Democratically-led state is tied to the oil and gas industry.

“New Mexico’s impact is way bigger than Wyoming or Colorado or North Dakota,” Prest said, “and that’s just because that’s where the action is on new development.”

The effects will unfold gradually, since federal leases allow a 10-year window to begin drilling and production. Still, state officials say they're already prepping for leaner years.

“It all hurts when you’re losing revenues," said Democratic state Sen. George Muñoz of Gallup, who said lawmakers still hope to invest more in mental health care and support Medicaid, even if federal royalty payments decline. “We’ve learned that until the chicken’s got feathers, we’re not even looking at it."

The higher federal royalty rate was in place for roughly three years while leasing activity was muted, Prest said. New Mexico budget forecasters never tallied the additional income.

New Mexico's nest-egg strategy

A nearly five-fold surge in local oil production since 2017 on federal and state land in New Mexico delivered a financial windfall for state government, helping fund higher teacher salaries, tuition-free college, universal free school meals and more.

The state set aside billions of dollars in investment trusts for future spending in case the world’s thirst for oil falters, including a early childhood education fund to help expand preschool, child care subsidies and home wellness visits for pregnancies and infants.

The state's investment nest egg has grown to $64 billion, second only to Alaska's Permanent Fund. Earnings from the trusts are New Mexico's second-biggest source for general fund spending.

That sturdy financial footing shaped a defiant response to this year’s federal government shutdown, when lawmakers voted to subsidize the state’s Affordable Care Act exchange, cover food assistance and backfill cuts to public broadcasting.

But lawmakers reviewing state finances learned that predictable income fell 1.6% — the first contraction since the start of the COVID-19 pandemic.

Muñoz said matters would be worse if the state had not raised its own royalty rates this year to 25%, from 20%, for new leases on prime oil and gas tracts, while ending a sales moratorium, under legislation he co-sponsored this year.

Encouraged in Alaska

After New Mexico, the states receiving the most federal oil and gas royalties are Wyoming, Louisiana, North Dakota and Texas.

Texas, the nation’s top oil producer, shares the bountiful Permian Basin with New Mexico but has far less federal land and therefore less exposure to changes in royalty policy.

In Alaska, state officials say they are encouraged by the royalty cut, seeing potential for increased development in places like the National Petroleum Reserve-Alaska, where the massive Willow project — approved in 2023 and now under development — is viewed by some as a catalyst for further activity. The reserve is expected to hold its first lease sales since 2019.

“If reduced federal royalty rates stimulate new leasing, exploration and production, that also could increase other kinds of revenue,” said Lorraine Henry, a spokesperson for Alaska’s Department of Natural Resources.

In North Dakota, federal royalties are split evenly between the state and county governments where drilling occurs. State Office of Management and Budget Director Joe Morrissette said the industry’s future remains difficult to forecast.

“There are so many variables, including timing, price, availability of desirable tracts, and federal policies regarding exploration activities,” Morrissette said.

Houston energy tech company breaks ground on low-cost green hydrogen pilot plant

coming soon

Houston’s Lummus Technology and Advanced Ionics have broken ground on their hydrogen pilot plant at Lummus’ R&D facility in Pasadena.

The plant will support Advanced Ionics’ cutting-edge electrolyzer technology, which aims to deliver high-efficiency hydrogen production with reduced energy requirements.

“By demonstrating Advanced Ionics’ technology at our state-of-the-art R&D facility, we are leveraging the expertise of our scientists and R&D team, plus our proven track record of developing breakthrough technologies,” Leon de Bruyn, president and CEO of Lummus, said in a news release. “This will help us accelerate commercialization of the technology and deliver scalable, cost-effective and sustainable green hydrogen solutions to our customers.”

Advanced Ionics is a Milwaukee-based low-cost green hydrogen technology provider. Its electrolyzer converts process and waste heat into green hydrogen for less than a dollar per kilogram, according to the company. The platform's users include industrial hydrogen producers looking to optimize sustainability at an affordable cost.

Lummus, a global energy technology company, will operate the Advanced Ionics electrolyzer and manage the balance of plant systems.

In 2024, Lummus and Advanced Ionics established their partnership to help advance the production of cost-effective and sustainable hydrogen technology. Lummus Venture Capital also invested an undisclosed amount into Advanced Ionics at the time.

“Our collaboration with Lummus demonstrates the power of partnerships in driving the energy transition forward,” Ignacio Bincaz, CEO of Advanced Ionics, added in the news release. “Lummus serves as a launchpad for technologies like ours, enabling us to validate performance and integration under real-world conditions. This milestone proves that green hydrogen can be practical and economically viable, and it marks another key step toward commercial deployment.”