Nikola (NASDAQ:NKLA) stock is up by about 15% today after the company announced a collaboration with KeyState Natural Gas Synthesis. The two companies will work together to create the “first low-carbon hydrogen production value chain” in Pennsylvania. In addition, the collaboration will provide Nikola with “full integration of commercial carbon capture and storage” and up to 100 tons of low-carbon hydrogen per day. Currently, Nikola and KeyState are working on a definitive agreement to expand Nikola’s hydrogen supply.
Carey Mendes, President of Energy at Nikola, had the following to say:
“Nikola’s participation in the project will allow us to secure sufficient volumes of hydrogen to underpin and accelerate the adoption of zero-emission trucks by unlocking new customer demand and enabling key investments in downstream hydrogen refueling infrastructure in the Mid-Atlantic region.”
The 100 tons of low-carbon hydrogen per day will be able to power up to 2,500 Nikola Tre fuel-cell electric vehicles (FCEVs). That can also replace 51 million gallons of fossil fuel per year. Upon completion of the Pennsylvania site in 2026, the 7,000 acre facility will be able to store the CO2 necessary for hydrogen production and “provide strategic reach and access to premium Mid-Atlantic FCEV markets.”
Why Is Nikola (NKLA) Stock Up 15% Today?
This is certainly a positive for NKLA stock insiders as the company works to bounce back from its controversial past. Earlier this month, founder and former CEO Trevor Milton was found guilty on three counts of fraud. Milton previously faced two counts of securities fraud and two counts of wire fraud. The charges were related to false statements that the CEO made in order to increase the valuation of Nikola, such as posting a video of a vehicle rolling down a hill instead of being driven.
U.S. Attorney Damien Williams added the following about the situation:
“Trevor Milton lied to Nikola’s investors — over and over and over again. That’s fraud, plain and simple.”
Milton will receive his sentence on Jan. 27 and faces up to 25 years in prison. According to a Form 4 received on Aug. 24, he still owns 51.04 million shares of NKLA stock and another 1.25 million shares through his spouse.
Last December, Nikola agreed to pay a $125 million fine to the U.S. Securities and Exchange Commission (SEC) for defrauding and misleading investors.
On Penny Stocks and Low-Volume Stocks: With only the rarest exceptions, InvestorPlace does not publish commentary about companies that have a market cap of less than $100 million or trade less than 100,000 shares each day. That’s because these “penny stocks” are frequently the playground for scam artists and market manipulators. If we ever do publish commentary on a low-volume stock that may be affected by our commentary, we demand that InvestorPlace.com’s writers disclose this fact and warn readers of the risks.
On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.