UGI to fund more than $70M in renewable natural gas projects from MBL Bioenergy in South Dakota

Efforts by MBL Bioenergy to develop a set of renewable natural gas (RNG) projects in South Dakota solidified this week through a new agreement with UGI Energy Services, LLC (UGIES), the result of which will see UGI fully fund these efforts with more than $70 million of investment.

These new projects represent a first set – or cluster – to be built at three farms north of Sioux Falls, South Dakota. They will gather and process dairy waste into a central upgrading facility, from which the anaerobically digested product will be piped into the interstate natural gas system. At that point, UGIES will be its sole marketer.

MBL is a joint venture partnership between UGIES, Sevana Bioenergy, and a subsidiary of California Bioenergy.

“This project sets a new standard for UGI in terms of scope and size and represents a huge milestone in UGI’s investments in, and expected earnings contribution from, RNG projects,” Robert Beard, UGI executive vice president of natural gas, global engineering, construction & procurement, said. “We are pleased to be partnering with industry-leading developers on this project that will substantially reduce greenhouse gas emissions, using dairy RNG as a vehicle fuel. We look forward to making additional investments in our MBL partnership as we advance the use of RNG as an environmentally responsible and clean energy solution.”

This will present a lucrative new venture for the dairy farms, while for energy companies, it could represent a cleaner-burning replacement for diesel.