Japanese conglomerate enters Indian bio-fuels sector with GPSR and IOCL as collaborators

Bengaluru: Sojitz Corporation has invested in a holding structure of a special purpose company established jointly by GPS Renewables Private Limited and Indian Oil Corporation Ltd., which designs, constructs, operates, and provides maintenance for biomethane plants in India (GPSR-IOCL Biomethane Platform).

Through this strategic investment, Sojitz will foray into biomethane production and sales in India.

Sojitz will work in collaboration with IOC-GPS Renewables Pvt. Ltd. (IGRPL), a joint venture between GPS Renewables and Indian Oil Corporation Ltd, to develop and operate biomethane production facilities using agricultural waste as feedstock.

IGRPL plans to establish 30 biomethane plants by FY 2026-2027  with a production capacity of 160,000 tonnes of biomethane annually.

These projects have a total outlay of over USD 400 million.

Ernst and Young (EY) was the exclusive M&A investment banker and Cyril Amarchand Mangaldas led by Partner Alok Sonkar was the transaction advisor representing GPS Renewables.

Biomethane is produced by purifying biogas and it can be a direct replacement for fossil fuel, significantly reducing greenhouse gas emissions and promoting the circular economy.

Commenting on the investment, Mainak Chakraborty, CEO and Co-Founder, GPS Renewables, said, “Sojitz and GPSR group have a shared vision of improving India’s energy self-sufficiency. As the country’s energy demand continues to rapidly grow, it’s crucial for us to prioritize biofuels and find ways to reduce our dependence on fossil fuels.  This collaboration with Sojitz is a step towards increasing the production of cleaner sources of energy while reducing air pollution caused by the open burning of agricultural waste.”

Sojitz indicates that India is one of its key strategic markets and plans to play an active role in its transition to renewable energy.

Green transformation (GX) business is a priority for Sojitz, and to advance this initiative further, a dedicated organization has been set up to drive their GX initiatives.

Sojitz currently focuses on developing renewable energy projects that have the potential to accelerate India’s biomethane sector while also addressing a few key environmental concerns such as air pollution.

Through this investment, Sojitz and GPSR will work to drive India’s clean energy goals by accelerating the expansion of biomethane production and operation across the country.

The companies will leverage GPSR’s expertise in biomethane production processes, technology expertise, in-depth experience in design, construction, operation, and maintenance of biomethane plants.

Additionally, IOCL’s expansive network with gas consumers will play a crucial role in scaling distribution.

Furthermore, Sojitz will assess opportunities for biomethane production beyond India by deploying GPSR’s technology in new regions to explore opportunities in the broader bio-energy sector.

About Sojitz Group

Sojitz Corporation was formed out of the union of Nichimen Corporation and Nissho Iwai Corporation, both companies that boast incredibly long histories. For more than 160 years, their business has helped support the development of countless countries and regions. Today, the Sojitz Group consists of approximately 400 subsidiaries and affiliates located in Japan and throughout the world, developing wide-ranging general trading company operations in a multitude of countries and regions.

Sojitz Group is engaged in a wide range of businesses globally, including manufacturing, selling, importing, and exporting a variety of products, in addition to providing services and investing in diversified businesses, both in Japan and overseas.

Sojitz operates with a seven-division structure comprising the Automotive Division, the Aerospace, Transportation and Infrastructure Division, the Energy Solutions and Healthcare Division, the Metals, Mineral Resources and Recycling Division, the Chemicals Division, the Consumer Industry and Agriculture Business Division, and the Retail and Consumer Service Division.

About GPSR Group

Headquartered in Bengaluru, GPS Renewables (GPSR) is a full-stack biofuels firm offering technology and project solutions for climate-positive bio-fuel projects. Starting from captive biogas plants, GPSR has scaled up to set up some of the world’s largest RNG plants.

In 2022, GPS Renewables launched GPSR Arya Pvt Ltd (ARYA) a wholly-owned subsidiary, to commission BOO (Build-Own-Operate) projects, augmenting its climate impact ambitions.