UPDATE 1-Clean Energy to sell renewable gas at the pump
(Adds details on renewable natural gas product)
LOS ANGELES, Oct 3 (Reuters) - Shares of Clean Energy Fuels Corp fell 5.8 percent on Thursday after the company said it would distribute a renewable natural gas made from organic waste at some of its fueling stations, disappointing investors who had bid up the stock this week on the chief executive's Twitter promise of "big news."
Shares of the provider of natural gas for transportation fell 80 cents to close at $12.99 on the Nasdaq.
On Monday, Clean Energy CEO Andrew Littlefair tweeted: "I promised big news this week and I'll deliver," sending his company's stock up a combined 8 percent over the following two days.
The stock gave back most of those gains on Thursday, however, when the Newport Beach, California, company said it would be the first to commercially distribute a natural gas vehicle fuel made from waste streams, such as landfills, dairies and sewage plants.
The company had previously sold renewable natural gas to utilities for generating power, but now it is also selling it as a transportation fuel called Redeem.
Still, Raymond James analyst Pavel Molchanov said the announcement was more of a "rebranding, pure and simple, of what the company has already been doing."
Redeem will be sold directly to fleets around the country and at 35 California public fuel stations for the same price as compressed natural gas, or CNG. Because it is renewable, Redeem qualifies for federal renewable fuel credits.
Natural gas made from waste streams produces far fewer carbon emissions than conventional natural gas, a benefit that could help Clean Energy attract new customers, Macquarie analyst Matthew Blair said in a client note.
Clean Energy sold 8.9 million gasoline equivalent gallons of renewable natural gas last year, according to a regulatory filing. It said in Thursday's statement that it plans to sell 15 million gallons of Redeem in the fuel's first year.
The company produces the renewable gas at facilities in Texas and Michigan and is building a third facility in Tennessee. It is also sourcing the gas from third parties.
(Reporting by Nichola Groom in Los Angeles and Garima Goel in Bangalore; Editing by Kenneth Barry and Phil Berlowitz)