BASF: Between Green Transformation and Record Figures
BASF is driving forward the decarbonization of its energy-intensive production. The company secured a seven-year contract with ENGIE for 2.7 to 3.0 terawatt-hours of biomethane for its Ludwigshafen and Antwerp sites. The aim is to replace fossil methane. At the same time, the hydrogen initiative is underway. In Ludwigshafen, Germany’s largest PEM electrolyser has been producing its first batches since March 2025, while a Sunfire SOEC test facility has been under construction in Schwarzheide since August of this year. The technology promises efficiencies of up to 89% and could significantly reduce the cost of green hydrogen.
The second quarter significantly exceeded analysts’ expectations with revenue of EUR 17.2 billion and EBITDA of EUR 2.4 billion. The sale of the coatings business to Carlyle brought in EUR 5.8 billion, representing a special gain of approximately EUR 3.5 billion after taxes. BASF subsequently raised its full-year forecast to between EUR 6.9 and 7.7 billion in EBITDA. Production is currently limited due to extremely low water levels in the Rhine. The company is investing over EUR 100 million in the expansion of the intermodal terminal, which is intended to reduce dependence on waterways starting in 2028.
Shareholders will benefit from capital returns. Up to EUR 1 billion will be allocated to share buybacks by April 2027, as part of a EUR 4 billion package through the end of 2028. In total, BASF plans to distribute approximately EUR 12 billion between 2025 and 2028, of which EUR 8 billion will be in dividends. The minimum dividend is EUR 2.25 per share. At the same time, the spin-off of the agricultural division is progressing, with an initial public offering (IPO) targeted for 2027. While the Green Energy Manufacturing concept is achieving initial CO₂ savings with partners such as Bosch and Eaton, the question of scaling up hydrogen production remains unresolved, as demand in Ludwigshafen far exceeds electrolysis capacities.
A.H.T. Syngas: From Supplier to Integrated Energy Partner
The Dutch cleantech company A.H.T. Syngas, with locations in Germany, specializes in converting biogenic waste materials into synthesis gas. At the heart of the process is the patented dual-fire gas generator, which breaks down waste wood, agricultural waste, or sewage sludge at high temperatures in an oxygen-deprived environment into a nearly tar-free gas mixture. This gas can be flexibly used for electricity and heat generation or as a feedstock for hydrogen and synthetic fuels. Management is currently implementing a strategic shift. The company no longer intends to focus exclusively on plant sales but rather to operate the plants itself under a contracting model. This solution promises predictable, recurring revenue and higher margins.
The Polish market offers ideal conditions for the technology. The country has extensive agricultural and forestry residues but remains heavily dependent on coal. Political pressure to decarbonize is correspondingly high. With local partner INNOTEC Energy, A.H.T. has an established partner in place that holds the rights to 17 projects and handles the acquisition and permitting processes. This division of labor is intended to accelerate scaling. Orders totaling over EUR 10 million are already expected this year, and according to the company, over EUR 25 million is even possible by 2029.
The EUR 2 million convertible bond, which was fully placed at the beginning of the year, strengthens the company’s ability to act. The capital is being channeled into ongoing projects and the expansion of the operations business. At the same time, the company has developed a containerized hydrogen solution with the BiDroGen project. The technology can produce biogenic hydrogen at a cost ranging from EUR 4.40 to 7.98 per kg. This is significantly cheaper than electrolytically produced hydrogen, which ranges from EUR 8.87 to 9.22. Analysts at GBC Research forecast revenue of just over EUR 9.2 million for 2026, which is expected to more than double to over EUR 23 million by 2028. The price target is EUR 8.50.
Verbio: From Investment Mode to Profitability Phase
Verbio SE is transforming. After two years of operational challenges caused by distorted GHG quota markets and margin pressure in the bioethanol sector, signs of a turnaround are mounting. The preliminary EBITDA of approximately EUR 192 million for 2025/26 is well above the company’s own forecast. The key factor is the quality of this recovery. The bulk of the improvement stems not from one-time special effects, but from the normalization of the German quota market and more favorable ethanol spreads. Verbio benefits from its integrated biorefinery approach. The integration of bioethanol and biomethane production ensures that residual materials from one process flow into the next as raw materials. This allows biogenic CO₂ to be marketed. This integration reduces costs and also expands margins.
Regulation is the key driver of the earnings recovery. GHG quota prices in Germany, which form the economic backbone of Verbio’s European business, are trending more positively again following the correction of market distortions. Analysts expect increasing stabilization. However, policy shifts or renewed cheap imports could jeopardize the recovery. At the same time, Verbio has accumulated a substantial allowance buffer of just under 0.7 million metric tons of CO₂ equivalent. At a price of EUR 400 per metric ton of CO₂, monetizing this surplus could generate over EUR 220 million in cash flow in the coming years. However, this figure is not fixed; it depends on future price conditions.
The actual investment thesis is based on a strategic realignment. After years of capacity expansion in North America and Europe, the company is now set to reap the rewards. In Nevada, rising utilization rates are improving profitability, while South Bend is being gradually developed into an integrated ethanol and RNG production facility. The focus on biomethane and renewable natural gas addresses a growing market for lower-emission energy sources. At the same time, the chemicals business is set to become a fourth pillar. The new renewable chemicals plant could contribute significant revenue and margins at full capacity. Earnings growth in the coming years will come from using the existing, expanded, and integrated network of facilities.
Germany’s shift away from fossil natural gas is not an option, but a reality under the current government. Empty storage facilities are forcing industry to take its own precautions. BASF is securing its green raw material base through long-term biomethane and hydrogen projects. A.H.T. Syngas is demonstrating, with its scalable waste gasification technology, that local, self-sufficient energy production is already economically viable today. Verbio is returning to profitability thanks to stabilized quota markets and integrated biorefinery concepts.
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