Chevron Corp. agreed to buy green diesel producer Renewable Energy Group Inc. for $3.1 billion in the biggest low-carbon deal of Chief Executive Officer Mike Wirth’s four-year tenure.
The San Ramon, California-based oil giant will pay $61.50 a share for Renewable, it said Monday in a statement. Bloomberg News reported the companies were close to a deal late Friday.
The purchase would give a significant boost to Chevron’s push into renewable fuels, with demand expected to grow in the coming years as businesses and governments move away from oil and gas to cut carbon emissions. Chevron, like the rest of the fossil fuel industry, is under pressure from investors to help scale up technologies to advance a low-carbon economy as well as reduce its own carbon footprint.
Renewable, based in Ames, Iowa, is one of North America’s largest producers of biodiesel, and they also make renewable diesel. The fuels are seen as critical in decarbonizing heavy-duty transportation that cannot be electrified as easily as passenger vehicles, such as airplanes.
