Durham clean energy startup NET Power lines up $275M in additional financing

DURHAM – NET Power, the Durham-based company looking to build a clean energy plant, says it has secured an additional $275 million in capital for its proposed business merger with Rice Acquisition Corp.

Backing NET Power, which plans to build a plant in Texas costing as much as $950 million, are Occidental, which has invested previously, and the Rice family.

Earlier this month NET Power moved closer to building what it calls “the world’s first large-scale gas-fired power facility with near-zero emissions” and includes carbon capture technology. The selection of Zachry Group, which is based in San Antonio, follows NET Power’s announcement in December to pursue going public in a merger with Rice Acquisition Corp.

The NET Power process from the company’s website

The Durham based, privately held company announced this week it had selected Zachry Group as the engineering firm for the project.

The investment is coming through so-called PIPE financing. According to Investopedia, private investment in public equity (PIPE) is the buying of shares of publicly traded stock at a price below the current market value (CMV) per share. This buying method is a practice of investment firms, mutual funds, and other large, accredited investors.

Occidental has now committed $350 million to the venture, the Rice family $125 million.

“We believe NET Power’s technology can accelerate emissions reductions in our existing operations and ultimately supply emissions-free power to the Direct Air Capture facilities and sequestration hubs we are developing,” said Vicki Hollub, CEO of Occidental, in the announcement. “Our additional $250 million investment in NET Power demonstrates our conviction in NET Power’s technology and mission to globally deploy affordable and reliable zero-emissions energy.”

NET Power says the combined company has so far established a market capitalization “in excess of $2 billion.”