Chevron and California Bioenergy announced their second holding company to produce and market dairy biomethane as a renewable natural gas (RNG) transportation fuel in California.

CalBioGas Hilmar, the holding company, secured initial funding from Chevron to build infrastructure for dairy biomethane projects in California’s Merced County.

CalBio brings technology and operational experience to help dairy farmers build digesters and methane capture projects to convert this methane to use as renewable natural gas.

Chevron will provide additional funding for as many as seven digesters and one central upgrading facility across a cluster of dairy farms in Merced County.

The cluster of digesters has been awarded California Department of Food and Agriculture grants, which must be augmented with additional capital to complete the projects. When complete – expected in 2023 – Chevron will take 100 percent of the renewable natural gas produced to market in the California vehicle fuels market.

“The investment underscores our commitment to produce 40,000 MMBTU/D of RNG by 2030 and grow the lower carbon businesses that we believe will be a bigger part of the future,” said Andy Walz, president of Americas Fuels & Lubricants for Chevron.