News | December 2014

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Enviva Wants IPO, Is Adding Capacity

Enviva, which recently announced it is building two additional pellet plants in North Carolina, and is purchasing the Green Circle Bio Energy pellet operation in Cottondale, Fla. from JCE, is reportedly seeking a $100 million initial public offering.

Pointing to its growing production capacities and to forecasts for tremendous gains in global demand, Enviva believes it is positioned to capture a significant portion of this future wood pellet growth.

In the past three years Enviva has built and started up plants in Ahos­kie, NC; Northampton County, NC; and Southampton County, Va., while operating purchased plants in Amo­ry, Miss. and Wiggins, Miss. The combined wood pellet production capacity from these five facilities is 1.6 million metric tons. Enviva exports its product through terminals in Chesapeake, Va. and Mobile, Ala.

The company also recently announced plans to build two facilities in Richmond and Samson counties in southeast North Carolina with an investment of more than $214 million.

The Green Circle facility reports a production capacity of approximately 650,000 metric tons per year. The plant benefits from an abundant supply of locally procured raw material, principally pine, and exports its product from the Port of Panama City, Fla.

Like Enviva, Green Circle supplies wood pellets under long-term contracts to major European power generators that replace coal with biomass. Additionally, Green Circle supplies the European market for wood pellets to heat homes and commercial buildings and to produce process heat at industrial sites.

The Green Circle facility in Florida began production in 2008.

Cool Planet Receives USDA Commitment

U.S. Dept. of Agriculture has issued Cool Planet Energy Systems a $91 million conditional commitment for a loan guarantee to support construction of the company’s first commercial manufacturing plant to be located at the Port of Alexandria, Louisiana. The plant is expected to produce renewable fuels by converting wood chips into high octane gasoline and aromatic blendstocks that are chemically identical to fossil fuels, according to Cool Planet.

USDA Secretary Tom Vilsack com­ments, “This partnership is the latest example of the Obama Administration’s continuing support for innovative, home-grown energy sources. USDA’s support for renewable energy projects like this helps create jobs in rural areas, promotes U.S. energy independence, and leads to further expansion of the grow­ing and increasingly significant bioeconomy—all while reducing carbon pollution and other greenhouse gases.”

Cool Planet states it expects this commercial plant to be the first of hundreds of plants that its company builds across the U.S.

Cool Planet broke ground at the Port of Alexandria earlier this year. Site preparation and detailed engi0neering design work is under way, and the company expects to start construction in early 2016.

The technology combines a mechanical front-end that processes the biomass with heat and pressure into gases, with proprietary catalysts that convert those gases directly into Cool Planet’s green fuels, leaving a valuable biochar behind.

The company says its fuels are chemically identical to fossil fuels, and its CoolTerra product increases crop productivity and promotes more robust plant health while reducing fertilizer and water requirements.

Cool Planet reports its strategic investors include BP, Google Ventures, GE, ConocoPhillips, NRG Energy, the Constellation division of Exelon, and leading venture capital investors, including North Bridge Venture Partners.

Earth Partners Buys Deadwood Biofuels

The Earth Partners LP, a land restoration and bioenergy development company, announced it has acquired Deadwood Biofuels LLC, a company based in the Black Hills of South Dakota (Rapid City) that produces wood pellets for heating and industrial markets.

“We are excited to execute on our strategy of acquiring and developing a pipeline of bioenergy projects. I am confident with our supportive capital partners and our team’s experience spanning corporate finance, biomass markets, forestry, and pellet facility operations, we can continue to execute on the pipeline of opportunities we have established over the last four years,” says The Earth Partners CEO David Tepper.

Tepper says they are working closely with the Forest Service regional offices to use trees killed by the mountain pine beetle, along with timber residues that are destined to be burned in the forest as waste.

U.S. Army Awards Contract To ReEnergy

In late September the U.S. Defense Logistics Agency awarded a 20-year contract to ReEnergy Black River to provide secure, renewable electricity to Fort Drum (New York).

“This is good news not only for ReEnergy, but for Fort Drum and the North Country region. This will enhance energy security and position Fort Drum as a leader in meet­ing the military’s ambitious renew­able energy goals,” says Larry ­Rich­ardson, CEO of ReEnergy Hold­ings. “The ReEnergy team is proud to assist the U.S. Army in meeting its renewable energy goals.”

The Defense Logistics Agency, the entity that awarded the contract, provides the Army, Navy, Air Force, Marine Corps, other federal agencies, and combined and allied forces with logistics, acquisition and technical services.

ReEnergy Black River submitted a proposal in spring 2013 to the Defense Logistics Agency as part of a competitive procurement process to provide renewable power to Fort Drum, a U.S. Army installation that is home to 37,000 soldiers and family members and employs almost 4,000 civilians.

The federal government is in­creas­ing its demand for long-term renewable energy as a result of re­new­able goals established in the Energy Policy Act of 2005, Executive Order 13423, and the Energy Independence and Security Act of 2007. In addition, the Army has established a goal to achieve 1 gigawatt of renewable energy by 2025.

This contract is the largest re­new­able energy project in the history of the U.S. Army, according to ReEnergy Holdings.

The ReEnergy Black River facility, located inside the fence at Fort Drum, has 60 MW of generation capacity. Before it was idled in early 2010 by its former owner, the facility primarily burned coal to produce electricity. ReEnergy acquired the facility in December 2011 and invested more than $34 million to convert the facility to use biomass as its primary fuel. The converted facility commenced operations in May 2013. The facility will provide all of Fort Drum’s electricity needs, which currently peaks at about 28 MW.

The facility was to begin supplying 100% of Fort Drum’s electrical load as of November 1. Under the terms of the agreement, ReEnergy is building an electric transmission line to directly connect the ReEnergy Black River facility to Fort Drum’s two substations. Prior to the completion of that line, which is anticipated for late summer 2015, ReEnergy will arrange for bilateral deliveries to Fort Drum’s substations through an energy service company.

ReEnergy owns and/or operates nine energy generating facilities with 325 MW of installed renewable energy generation capacity. ReEnergy operates in six states.

Green Power Project Completes Financing

Green Power Solutions of Georgia, LLC (GPS) reports it has completed financing for the company’s 34 MW power cogeneration facility in Dublin (Laurens County), Ga. at the SP Fiber Technologies paper mill.

GPS is a joint venture between ASK Partners and SP Fiber Technologies (SPFT). ASK owners are hardwood lumber manufacturer Beasley Forest Products & Land Care Services.

The facility is scheduled for commercial operation in June 2015, according to the participants.

“We have a lot of people to thank for fulfilling our dreams to become a green power producer,” says Darrell Beasley, President of ASK Partners. “Georgia Power, the Georgia Public Service Commission, Laurens County Economic Development Authority and the City of Dublin were all incredibly supportive and helpful in this quest.”

Avenue Capital and Beasley Green Power provided financing for the project.

 SPFT is a producer of recycled ultra-lightweight containerboard, bag and kraft specialties papers and recycled content newsprint. The company also operates a mill in Newberg, Ore.

'Host Terminals Will Operate Port Facility

Host Terminals, Inc. announced its appointment by Baton Rouge Transit LLC, a wholly owned subsidiary of Drax Biomass International, Inc., as terminal operator of the new Baton Rouge Transit Facility. Brian Taylor will lead the Host Terminal operations at the Baton Rouge facility as Terminal Manager.

Located in the Port of Greater Baton Rouge, Louisiana, the new facility was constructed to store and export biomass bound for the United Kingdom. Host Terminals is set to begin operations when the facility opens later this year. Host is on-site and working collaboratively with Drax to make final preparations and conduct training.

The facility will receive pellets from regional manufacturing facilities in the Gulf. At the port, the pellets will then be stored and loaded onto vessels for shipment to the United Kingdom. After a ramp-up period, the facility is expected to handle 1.2 million metric tons of pellets each year.

Host Terminals currently operates at eight terminal locations along the U.S. East and Gulf Coasts, with the start of operations at the Baton Rouge Transit Facility to be the first private facility in the Gulf operated by Host. Host handles approximately 5 million tons of bulk cargo annually and was awarded a new stevedoring license by the Port of ­Great­­­er Baton Rouge earlier this year.

Canfor To Build Two Pellets Plants

Canfor Corp., known for it vast sawmill operations in North America, plans to construct a pellet plant at each of the company’s Chetwynd and Fort St. John saw­mill sites in partnership with Pacific Bioenergy Corp.

The two plants will have a combined annual production capacity of 175,000 tonnes of wood pellets, the sale of which is tied to a long-term agreement with a power utility customer. The total investment of $58 million will include electrical self-generation capacity of 3 MW.

German Pellets Cites Earnings Growth

German Pellets GmbH in its Group Financial Report for the first half of 2014, referring to itself as the world’s largest producer and trader of wood pellets, generated sales of Euro 260.6 million (+10% yoy growth), and earnings before interest, taxes, depreciation and amortization (EBITDA) at Euro 25 million compared to 18.8 million in the previous year’s period. Earnings before taxes also developed positively, ­ris­ing from Euro 4.7 million to Euro 8.3 million, while net income surged from Euro 1.9 million to Euro 5.1 million.

The key growth and profit driver, according to the company, was the launch of the company’s first U.S. wood pellet plant in Woodville, Texas, which started operations in third quarter, 2013. Overall, the wood pellet market has grown in nearly all Western European markets despite the mild winter, the company stated, adding, German Pellets plans to soon launch production of its second U.S. plant in Urania, La.

“We will be further pursuing our course of expanding U.S. capacities,” comments Peter Leibold, Managing Partner of German Pellets GmbH.

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