Climate Investment Invests in Trace Carbon Solutions, a Leading CCS Development Platform
22 August 2023
London, UK – Specialist decarbonization investor, Climate Investment (“CI”), today announces that it has invested in Trace Carbon Solutions (“Trace” or the “Company”), a leading North American carbon capture and sequestration (“CCS”) development platform. Following the CI investment, Trace will have over $420 million of equity capital commitments from Quantum Capital Group (“Quantum”), CI, and Trace management.
Headquartered in Houston, Texas, Trace develops low-cost CCS assets and infrastructure across North America. The management team’s successful track record developing, constructing, and operating midstream assets has direct parallels to delivering projects across the CCS value chain. The firm’s collaborative model seeks to work with partners to develop, construct, and operate projects that will significantly reduce CO2 emissions and help partners achieve their decarbonization goals.
CI has deep expertise in CCS, providing both the risk capital and the technical expertise necessary to drive forward CCS technologies and projects. To date, CI has invested in eight companies in the sector through its maiden Catalyst Fund I. The firm sees investing in CCS platforms such as Trace as an efficient and accelerated path to mobilizing and scaling CCS solutions for heavy-emitting sectors, including oil & gas, cement, and steel.
“Trace is excited to announce this new investment and partnership with CI. CI’s background in investing across the CCS value chain will be highly valuable to our team as we continue to develop our projects across North America,” said Josh Weber, Trace’s Chief Executive Officer. “One of our core beliefs at Trace is to surround ourselves with capital providers who can be value-added partners. We believe CI’s technical expertise and industry knowledge will accelerate the growth of the broader Trace platform.”
“We are pleased to welcome CI into the Trace platform. CI’s stellar reputation in CCS speaks volumes about the knowledge and capabilities of the CI team,” said Rob Meister, Managing Director of Quantum. Blake Webster, Partner at Quantum, added “We are excited about the project pipeline Trace has built to date, and we believe that CI will prove to be an invaluable partner throughout the development and operational phases of these projects.”
“Trace has developed an operating model that we believe can accelerate the buildout of CCS infrastructure. The firm has built an exceptional management team with proven expertise in developing gas infrastructure projects,” said CI Investment Principal Joey Bernica, who will join the Trace Board. “Its focus on working collaboratively with partners to reduce industrial CO2 emissions reflects CI’s own operating ethos. CCS is a sector we know well and the opportunity to work alongside two such established and high-caliber partners in Trace and Quantum is a very exciting prospect. We are confident that together we can deliver cost-efficient CCS solutions to companies across multiple industrial sectors.”
About Climate Investment
Climate Investment is an independently managed specialist investor focused on accelerating capital-efficient decarbonization of heavy emitting sectors.
Operational since 2017, its team of investment and technical experts has built a portfolio of over 30 outstanding technology and business model innovations. Collectively, its portfolio delivered 57 MT CO2e of greenhouse gas reduction in the period 2019-2022. Climate Investment was founded by member companies of the Oil & Gas Climate Initiative (“OGCI”). They have invested in Climate Investment funds and deployed many of its portfolio innovations, supporting their early commercial development.
Trace Midstream Partners (“Trace Midstream”) was formed in 2017 with a focus on developing midstream infrastructure across North America and has been supported by multiple equity capital commitments from Quantum since inception. Trace Carbon Solutions was formed in September 2022 following the successful sale of Trace Midstream’s Haynesville assets to Williams (NYSE: WMB) and Mid-Continent assets to Energy Transfer (NYSE: ET) for a combined transaction value of approximately $1.5 billion. Trace Carbon Solutions has over $420 million of equity capital commitments from Quantum, CI, and Trace management. The Company is actively pursuing the development of CCS assets and supporting midstream infrastructure across North America. For more information on Trace, please visit tracemidstream.com.
About Quantum Capital Group
Founded in 1998, Quantum Capital Group is a leading global provider of private equity, credit, structured, and venture capital to the responsibly sourced energy and energy transition & decarbonization sectors, having managed together with its affiliates more than $22 billion in capital commitments under stewardship since inception. For more information on Quantum Capital Group, please visit quantumcap.com.
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Climate Investment and/or its affiliates makes no representation as to the accuracy or completeness of this information. Any projections, forecasts and estimates are necessarily speculative in nature and actual results may vary. This communication is not an offer to sell, or a solicitation of offers to buy, securities of any investment fund. You should consult your legal and other advisors.