Svante raises $318 million Series E for carbon capture technology
The raise was led by Chevron New Energies, the U.S. oil giant's business unit focused on low-carbon fuels.
Vancouver climatetech company Svante raised a $318 million Series E supported by Chevron New Energies (CNE). This funding aims to help create a commercial-scale manufacturing facility in Vancouver, the output of which would allow for capture of millions of tonnes of carbon dioxide (CO2) per year. This marks Chevron’s second investment in carbon capture technology based in British Columbia, with prior financing in Squamish’s Carbon Engineering.
There are no Canadian investors present in this round. Svante’s raise was preceded by a $75 million Series D in early 2021 supported by Canadian backers, but led by Temasek, an investment company owned by the government of Singapore. The Canadian government invested $25 million in late 2021.
Svante aims to target hard-to-decarbonize industries with high emissions, such as manufacturers of hydrogen, pulp and paper, and chemicals. The company can capture 95 percent of total CO2 emitted from these industrial sources through the use of its modular, solid sorbent technology.
Increasing supply of carbon capture technology
Current carbon capture technology solutions are limited by the high cost of equipment and energy. “We are working to remove the biggest barriers to rapid deployment of industrial carbon capture by building this manufacturing facility, which we expect will enable us to rapidly expand our order book,” said Claude Letourneau, president and CEO of Svante. By producing its carbon capture technology at scale, Svante aims to develop hundreds of large-scale carbon capture and storage facilities to decarbonize.
Where does captured CO2 go?
Svante’s technology captures CO2 from industrial flue gas — the emitted material produced when fossil fuels are burned for heat or power. The captured CO2 is then concentrated into a liquid form the company calls “pipeline-ready”.
Underground storage is one application of captured CO2. The CO2 is transported via pipeline and injected into rock formations deep in the earth. This is similar to fracking, an existing process in the fossil fuel industry, where a liquid mixture is injected underground to retrieve oil or natural gas contained in rock.
Another application of captured CO2 is in other industrial processes. Historically, captured CO2 has been injected into depleted oil fields to enhance oil recovery, but has recently found other applications in consumer goods such asbody soap.
Investing in carbon capture technology amidst fossil fuel development
The investment is in line with Chevron’s climate strategy to reduce carbon emissions while continuing to expand oil and gas production. Earlier this month, the company budgeted $17 billion in capital expenditures for 2023, with the majority of spending directed towards fossil fuel development. Two billion dollars of this total was committed to lower-carbon initiatives, while double this amount at $4 billion was allocated for the Permian basin, the company’s existing oil and gas project in the southern United States.
Chevron plans to invest a total of $10 billion in lower carbon projects through 2028. The company first invested in Svante in 2014 through its venture fund, Chevron Technology Ventures. The fund’s investment in Carbon Engineering for its direct-air carbon capture technology came in 2019. Most recently, Chevron launched a project in 2020 to pilot Svante technology to capture CO2 from post-combustion of natural gas.
“[Chevron has] been a very good partner, not only financially to support us, but also will be quite instrumental in proving the technology in the marketplace by being an early adopter at the pilot plant scale,” said Letourneau.
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