Verde Clean Fuels Pauses Permian Basin Project Development Amid Strategic Review and Market Conditions
Verde Clean Fuels, Inc. (NASDAQ: VGAS) has announced that it is suspending development of its planned Permian Basin project, citing changing market dynamics in the region. The decision comes as demand for natural gas in the Permian Basin has increased, altering the economic assumptions that initially supported the project.
The project was originally announced in February 2024, when Verde entered into a joint development agreement (JDA) with Cottonmouth Ventures, LLC, a wholly owned subsidiary of Diamondback Energy, Inc. (NASDAQ: FANG). Under the agreement, the companies planned to develop a natural gas-to-gasoline production facility in the Permian Basin using Verde’s proprietary STG+® (syngas-to-gasoline plus) technology. The facility was designed to convert natural gas from Diamondback’s operations into finished liquid fuels.
Following the signing of the JDA, the companies initiated development activities, including a front-end engineering and design (FEED) study. The FEED process, which was completed in December 2025, provided detailed technical, cost, and execution insights into the proposed facility. However, despite the progress made, shifting market conditions—particularly stronger demand for natural gas in the region—reduced the project’s overall attractiveness, leading to the decision to suspend further development.
Verde’s leadership emphasized that the work completed on the project will still provide long-term value. Ernest Miller, Chief Executive Officer of Verde Clean Fuels, expressed appreciation for Diamondback’s support and noted that the insights gained from the FEED study would be useful for future projects. He added that suspending the Permian Basin initiative allows the company to focus its resources on other opportunities, particularly in regions where natural gas is stranded or routinely flared due to a lack of market access.
Miller also highlighted that Cottonmouth Ventures remains Verde’s second-largest shareholder and continues to support the company’s broader strategy to deploy its technology in more favorable markets.
Verde Clean Fuels is focused on commercializing its proprietary liquid-fuels processing technology through the development of production plants. The company’s STG+® process converts synthesis gas, or syngas, into fully finished gasoline and other liquid fuels that do not require additional refining. Syngas can be produced from a variety of feedstocks, including associated natural gas, biomass, and other carbon-based materials.
Currently, Verde is prioritizing projects that convert associated natural gas—often flared or stranded—into gasoline. This approach is intended to create new market outlets for otherwise wasted gas while also reducing flaring and producing fuels with potentially lower carbon intensity than conventional gasoline.
With the suspension of the Permian Basin project, the company is shifting its focus toward regions and opportunities where its technology can deliver stronger economic and environmental benefits.
About Verde Clean Fuels, Inc.
Verde is a clean fuels company focused on the deployment of its innovative and proprietary liquid fuels processing technology through development of commercial production plants. Verde’s synthesis gas (“syngas”)-to-gasoline plus (STG+®) process converts syngas, derived from diverse feedstocks, into fully finished liquid fuels that require no additional refining. Verde is currently focused on opportunities to convert associated natural gas into gasoline, which is expected to provide a market for such natural gas with the added potential benefits of flare mitigation and production of gasoline with a lower carbon intensity than conventional gasoline.
