Shares of Clean Energy Fuels Corp. (CLNE) - Get Report jumped more than 18% Monday after the company reached an agreement with Amazon (AMZN) - Get Report to provide low- and negative-carbon renewable natural gas for the tech company.
The fuel will be provided to Amazon Logistics, the company's shipping and delivery service, at existing Clean Energy fueling stations, as well as another 19 non-exclusive new or upgraded stations that Clean Energy expects to be constructed by the end of the year.
"If the world is really going to tackle the issue of climate change, all of us need to find solutions that work both environmentally and economically, and that is exactly what this agreement supports," said CEO Andrew J. Littlefair.
Clean Energy Fuels was rising 18.1% to $13.16 per share Monday morning.
As part of the agreement, Clean Energy issued to Amazon a warrant to purchase up to 53,141,755 shares of its common stock at a par value of $0.0001 per share.
The first tranche of 13.2 million warrants vested with the execution of the initial agreement, while subsequent tranches will vest over time based on discretionary fuel purchases by Amazon up to a total of $500 million.
The company expects to deploy between $45 million and $60 million in capital expenditures to build fueling stations that will support the renewable gas fueling volume that it has contracted to Amazon, according to the company's 8K filing.
Clean Energy is scheduled to report its first quarter financial results on May 6 with analysts expecting a break-even quarter on revenue of $75.3 million. A year ago, the company lost a penny per share while bringing in $86 million in sales.