Sustainable Jet Fuel Company Buying Red Trail Ethanol in North Dakota

Red Trail Energy near Richardton, is being acquired by Gevo, a company that is developing sustainable jet fuel company. (Amy Dalrymple/North Dakota Monitor

(North Dakota Monitor) – A company that is developing sustainable aviation fuel is purchasing a North Dakota ethanol plant that was the first in the nation to implement carbon capture and sequestration.

Gevo, based jn Englewood, Colorado, announced Thursday that it has a deal to buy Red Trail Energy at Richardton in southwest North Dakota for $210 million. Gevo officials said in a conference call that it hopes to close on the deal in the first quarter of 2025.

Red Trail, a partnership with numerous farmer-investors,  produces about 65 million gallons of ethanol per year, according to a Gevo news release announcing the deal. It has pore space lease agreements for 5,800 acres in the underground geologic formation known as Broom Creek, capable of storing 1 million metric tons of carbon annually.

Red Trail started underground storage of carbon in 2022 and currently sequesters approximately 160,000 metric tons of carbon annually.  Sequestration qualifies Red Trail for the 45Q federal tax credit that pays $85 per ton of carbon that is permanently stored.

Jodi Johnson, CEO of Red Trail, told the North Dakota Monitor in April that the carbon capture project was a $35 million investment.

“We expect our ownership of these assets to generate significant near-term and long-term value for our shareholders, while adding new jobs and economic growth to rural communities in the region,” Gevo CEO Patrick Gruber said in a news release.

Gevo officials said acquisition put the company on a path to profitability while it continues to develop a sustainable jet fuel project at Lake Preston, South Dakota, known as Net-Zero 1.

Gevo has signed on to the Summit Carbon Solutions pipeline that could potentially take carbon emissions from the Lake Preston plant and other ethanol plants to an underground storage area northwest of Bismarck.

The Summit project has faced regulatory delays and setbacks from legal action by landowners.

A decision on the Summit project in North Dakota is pending with the Public Service Commission.

Johnson said in a news release that “Gevo’s vision for a sustainable future aligns with our philosophy of ‘our farms, our fuel, our future.’ We are confident this acquisition will drive positive change in the renewable energy sector.”