Fervo Energy Co., an American startup in the field of geothermal energy, plans to raise up to $1.33 billion in an IPO in the United States amid growing demand for electricity for data centers. This is reported in a press release from Fervo.
Fervo intends to sell 55.56 million shares at a price of $21-24 in order to increase the company's market value to $6.5 billion.
JPMorgan Chase & Co., Bank of America Corp., Royal Bank of Canada and Barclays Plc are acting as organizers of the placement of Fervo shares on Nasdaq. Fervo's investors include Bill Gates' Breakthrough Energy Ventures investment company and shale oil producer Devon Energy Corp.
As part of the pilot project, Fervo uses horizontal drilling and multi-stage hydraulic fracturing to generate geothermal energy and expects to provide electricity to the first commercial plant by the end of 2026. The Cape Station project in Beaver County, Utah, will be one of the world's largest geothermal projects with a capacity of 500 MW.
Fervo has received permission to develop an additional 1.5 GW as part of the Cape project, with an increase in operating capacity to 100 MW by 2027, to launch data centers with AI, subject to $7.2 billion in electricity supply contracts for major oil and gas companies, including Edison Co., Google and Shell Plc.
Geothermal energy currently accounts for a small proportion of global electricity production due to its high cost and limited geographical availability. But Fervo's technology, based on the application of methods borrowed from the oil and gas industry, can reduce costs and expand the range of locations for access to geothermal energy.
Fervo Energy is a geothermal startup developing next—generation carbon-free energy technologies, including geothermal technologies. The headquarters is located in Houston, Texas.
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