Kinder Morgan buys 7 landfill gas projects, plans RNG conversions

By Kinder Morgan | August 16, 2022

Kinder Morgan Inc. on Aug. 11 announced it has closed on the acquisition of North American Natural Resources Inc. (NANR) and its sister companies, North American Biofuels LLC and North American-Central LLC. The $135 million acquisition in combined purchase price and related transaction costs includes seven landfill gas-to-power facilities in Michigan and Kentucky.

Shortly following close, KMI will make a final investment decision (FID) on the conversion of up to four of the seven gas-to-power facilities to renewable natural gas (RNG) facilities with a capital spend of approximately $175 million. Pending FID, these facilities are expected to be in service by early 2024. Once complete, the facilities are expected to generate approximately 2 billion cubic feet (Bcf) per year of RNG. This acquisition and the additional investments discussed above, combined with the recent Kinetrex Energy and Mas CanAm acquisitions, will enhance the company’s vertically integrated platform that delivers differentiated solutions across the RNG value chain. The combined RNG operations will provide KMI with annual RNG generation capacity of approximately 7.7 Bcf per year once all of the RNG facilities are in service. The remaining three NANR assets, projected to produce 4.8 megawatt-hours in 2023, will further diversify KMI’s renewable portfolio by adding electricity generation to its landfill gas-to-power operations.

“We are excited to continue KMI’s commitment to growing our RNG business through the acquisition of NANR’s facilities and expertise,” said Energy Transition Ventures President Anthony Ashley. “We believe this further positions us as a leader in the RNG marketplace and look forward to expanding our RNG footprint to benefit the customers, businesses and communities we serve.”

“We are proud of the business NANR’s employees have built over the past 43 years,” said NANR President Bob Evans. “With the evolution of energy markets, we are excited to join the KMI family as the world transitions to a cleaner energy future.”

KMI expects the investment to be accretive to its shareholders as the four converted RNG facilities become operational over the next 18 months, with the purchase price and additional development capital expenditures representing less than six times the expected 2024 EBITDA.

KMI’s August investor presentation as revised to include the NANR acquisition has been posted to the Investor Relations page of KMI’s website.