Case Summaries

Case Summary: Global Clean Energy Chapter 11

Global Clean Energy has filed for Chapter 11 bankruptcy amid construction delays, cost overruns, and protracted disputes involving its core Bakersfield renewable diesel refinery, aiming to restructure through a lender-backed plan.

By Bondoro

April 26, 2025

Summary

Vertically integrated renewable diesel producer Global Clean Energy Holdings files Chapter 11 (SDTX) citing liquidity crisis from Bakersfield refinery project failures.
Filing driven by significant refinery delays, cost overruns, and protracted dispute with EPC contractor CTCI Americas, culminating in a ~$924.3M mechanic's lien.
Enters bankruptcy with an RSA backed by key stakeholders: Ad Hoc Term Lenders (~96%), CTCI, and essential partner Vitol Americas.
RSA underpins a pre-filed plan aimed at resolving CTCI disputes, deleveraging, and funded by DIP from RSA parties.

Business Description

Headquartered in Bakersfield, CA, Global Clean Energy Holdings, Inc., along with its Debtor⁽¹⁾ and non-Debtor affiliates (collectively, "Global Clean Energy" or the "Company"), is a vertically integrated renewable energy company focused on producing sustainable, low-carbon renewable fuel designed as a direct replacement for petroleum-based diesel.

The Company operates a unique "farm-to-fuel" model, encompassing the development and cultivation of proprietary feedstock, primarily Camelina sativa ("Camelina"), through to the refining and distribution of renewable diesel ("RD").
This integrated approach aims to streamline operations, lower carbon emissions (potentially reducing greenhouse gas emissions by up to 85% compared to conventional diesel), and mitigate the "food versus fuel" conflict by utilizing non-sustenance crops like Camelina.
Global Clean Energy employs over 150 people directly and manages contracts with hundreds of growers globally.

The Company's business is structured into three principal segments:

Upstream: Focuses on breeding proprietary Camelina varieties and cultivating feedstock through partnerships with farmers globally.
Midstream: Manages logistics, transportation, storage, and pre-refinement processing of feedstock, linking the Upstream and Downstream operations, often via strategic partners like Louis Dreyfus Company ("LDC").
Downstream: Centers on the ownership and operation of the Bakersfield Renewable Fuels, LLC ("BKRF") facility in California, which refines Camelina and other biofuel feedstocks into RD and co-products. This segment relies on a supply and offtake agreement with Vitol Americas Corp. ("Vitol") for feedstock supply (like soybean and canola oil) and purchase of finished RD.

The Debtors filed for Chapter 11 protection on April 16, 2025, in the U.S. Bankruptcy Court for the Southern District of Texas. As of the Petition Date, the Debtors reported $1.6 billion in both assets and liabilities.

⁽¹⁾ For a complete list of Debtor entities, see the organizational structure chart below.

Corporate History

Global Clean Energy's focus shifted to the biofuels industry in 2007 when its predecessor, Global Clean Energy Holdings, LLC, relocated from Salt Lake City to Los Angeles. Initially concentrating on cultivating Jatropha seed oil for biodiesel, the Company acquired the trade secrets of this entity and expanded internationally, exploring various plant species for biofuel feedstock.

Over time, the Company pivoted to focus on Camelina, developing and acquiring what it states is the world's largest portfolio of proprietary Camelina varieties.

Strategic Acquisitions and Development

2013: Acquired Sustainable Oils LLC (predecessor to Debtor Sustainable Oils, Inc. or "SusOils"), a leader in Camelina genetics and production. This coincided with the U.S. Environmental Protection Agency ("EPA") approving Camelina under the Renewable Fuel Standard ("RFS") program for biomass-based diesel and advanced biofuel production.
2015: Received the first pathway for its Camelina under California's Low Carbon Fuel Standard ("LCFS") program from the California Air Resources Board, enabling its use in producing LCFS-compliant fuels.
2020: Acquired the Bakersfield Facility via the purchase of Alon Bakersfield Properties, Inc. (now BKRF) using proceeds from an initial $300 million senior secured term loan facility led by Orion Infrastructure Capital ("OIC"). This move aimed to achieve vertical integration and capitalize on California's LCFS incentives.
2020 (December): Debtor Global Clean Energy Holdings, Inc. ("GCEH") common stock began trading under the ticker symbol "GCEH". As of April 11, 2025, the stock traded at $0.37.
2021: Further expanded its Upstream capabilities by acquiring:
- Debtor Agribody Technologies, Inc. ("ATI"), an agricultural biotechnology company focused on genomic engineering.
- Entira, Inc., an agriculture business and marketing consulting firm (November).
- Camelina Company España S.L.U. ("CCE"), described as Europe’s largest Camelina crop innovator and seed producer (December).
2024 (Fall): Expanded operations into Canada through a non-Debtor subsidiary.

Organizational Structure

Operations Overview

Global Clean Energy operates through its vertically integrated Upstream, Midstream, and Downstream business segments, controlling the process from Camelina seed development to the production and market delivery of renewable fuels.

Upstream Business: Seed Development and Cultivation

Owns a large portfolio of proprietary Camelina genetics, focusing on breeding varieties with enhanced yield, faster maturity, and tolerance to drought and pests. Debtor ATI holds related patents in genomic engineering.
Highlights Camelina's advantages: a low-water-use crop suitable for marginal land, capable of being grown in rotation or on fallow land without competing directly with food crops or incurring significant land-use carbon penalties.
Operates breeding centers in North America, South America, and Europe (via non-Debtor CCE and Global Clean Renewable (Argentina) S.R.L.). Debtor SusOils leads North American efforts. Contractual relationships support seed production globally.
Partners with growers worldwide to cultivate Camelina:
- Contracted with over 500 growers in 2024.
- Planted acreage nearly doubled from approximately 65,000 acres in 2023 to over 124,000 acres in 2024.
Expects Camelina cultivation to increase, positioning it as a primary feedstock for the Downstream Business and the broader industry.

Midstream Business: Logistics and Processing

Coordinates grain handling, logistics, transportation, storage, and pre-refinement processing to move feedstock from farms to the refinery.
Utilizes a network of logistics providers (including LDC) and grain elevator operators.
Benefits from the strategic location of the Bakersfield Facility in California, the leading U.S. market for RD consumption. The facility has access to major rail lines, interstate highways, and pipeline networks, facilitating efficient bulk transport from various U.S. growing regions.
Sells protein-rich Camelina meal, a byproduct of oil extraction, to the animal feed industry. This generated $3.9 million in revenue in 2024 and helps offset Camelina oil production costs.

Downstream Business: Refining and Marketing

Centered around the Bakersfield Facility, a converted crude oil refinery acquired in 2020 and retooled into a renewable fuels plant.
- Development involved initial work under an EPC contract with Arb, Inc. (terminated after approx. six months) followed by a Turnkey EPC Agreement with CTCI Americas, Inc. ("CTCI") signed in May 2021, targeting completion by January 2022.
- The facility faced delays and cost overruns but became commercially operational in December 2024.
Primary product is RD (approx. 90% of production), with co-products including renewable propane, naphtha, and butane.
- Produced approximately 450,000 barrels of RD and co-products since launching operations in December 2024.
Operates under a Supply and Offtake Agreement ("SOA") with Vitol, dated June 25, 2024. Vitol supplies feedstock (e.g., soybean, canola oil) to supplement Camelina supply and purchases all RD produced, along with potentially other outputs like renewable naphtha. Other co-products are sold to various buyers (e.g., Midstream Energy Partners for butane/propane).
Generated approximately $26 million in revenue in 2024 (primarily in December) and projects $560 million in revenue for 2025.
Highlights RD advantages: chemically identical to petroleum diesel (100% drop-in replacement), cleaner burning (up to 85% emissions reduction), superior performance compared to traditional biodiesel (no blending needed, better cold weather properties). Camelina-based RD boasts an ultra-low carbon intensity.
Generates Renewable Identification Numbers (RINs) under the RFS Program, which can be sold to obligated parties (conventional refiners) for compliance purposes.
Notes potential for future expansion or addition of Sustainable Aviation Fuel ("SAF") production capabilities, leveraging the vertically integrated model and existing infrastructure to tap into growing SAF demand.