HOUSTON — Verde Clean Fuels, Inc. has officially announced the closing of the previously announced $50 million equity investment by Cottonmouth Ventures, LLC, a wholly-owned subsidiary of Diamondback Energy, Inc. The investment consists of the purchase of 12.5 million shares of Verde’s Class A common stock by Cottonmouth at a purchase price of $4.00 per share. The investment represents the second investment by Cottonmouth in Verde over the past two years, for a total investment of $70 million, making Cottonmouth the second largest shareholder of Verde.
Proceeds from the investment are expected to be used to further the development and construction of potential natural gas-to-gasoline production plants and for other general corporate purposes. The proposed plants to be jointly developed by Verde and Cottonmouth would produce fully-refined gasoline utilizing Verde’s patented (STG+®) process from associated natural gas feedstock supplied from Diamondback’s operations in the Permian Basin.
In connection with the investment, Verde expanded its Board of Directors from seven to eight members and appointed Johnny Dossey, as Cottonmouth’s director designee, to its Board of Directors.
“This investment is consistent with our commitment to efficiency and sustainability in oil and gas operations. Verde’s technology provides an exciting opportunity to convert associated natural gas from our Permian Basin operations into gasoline, as well as an anticipated high value outlet for a volume of our natural gas with the added potential benefit of flare mitigation and production of a lower carbon fuel,” said Mr. Dossey.
“We are proud and excited to announce the closing of Cottonmouth’s second investment in Verde,” said Ernest Miller, CEO of Verde. “Diamondback’s continued confidence in our team and our technology is instrumental as we continue advancing our plans to deploy our technology. In addition, we are pleased to welcome Johnny as a director to our Board of Directors. We look forward to having him as part of our team as we look to finalize engineering and design and shift focus toward constructing and operating commercial production plants.”
Mr. Dossey currently serves as Vice President of Marketing at Diamondback and has been with Diamondback since 2018. Prior to Diamondback, Mr. Dossey served in marketing roles for Concho Resources from 2014 to 2018. Prior to Concho, Mr. Dossey served in various leadership and commercial roles for Western Refining, Montana Refining Company, and Calumet Specialty Products Partners and Holly Corporation (now HF Sinclair). Mr. Dossey received a Bachelor of Business Administration in Management and a Master of Business Administration from Texas Tech University.
About Verde Clean Fuels, Inc.
Verde is a clean fuels company focused on the deployment of its innovative and proprietary liquid fuels processing technology through development of commercial production plants. Verde’s syngas-to-gasoline plus (STG+®) process converts syngas, derived from diverse feedstocks, into fully finished liquid fuels that require no additional refining. Verde is currently focused on opportunities to convert associated natural gas into gasoline, which would provide a market for such natural gas with the added potential benefits of flare mitigation and production of gasoline with a lower carbon intensity than conventional gasoline.
About Diamondback Energy, Inc.
Diamondback is an independent oil and natural gas company headquartered in Midland, Texas focused on the acquisition, development, exploration, and exploitation of unconventional, onshore oil and natural gas reserves in the Permian Basin.