Biomass Secure Power gets financial boost to help build biocoal plant
Canada-headquartered Biomass Secure Power has advised its shareholders that the Louisiana State Bond Commission approved the sale of $60 million (€56m) tax exempt bonds by the company’s wholly- owned subsidiary, Biomass Power Louisiana (BPL).
The company has engaged the Bank of America Merrill Lynch to sell the bonds on behalf of the company.
The proceeds of the bond issue will be used to build a new 240,000tpy, biocoal production facility at the Port of Natchitoches Louisiana, US. A 20 year off-take agreement has been confirmed for 200,000tpy of biocoal, which is expected to generate annual sales in excess of $40 million per year.
The total annual sales from phase one running at 240,000tpy is planned to be in excess of $48 million per year.
Biomass Secure Power and River Basin Energy are in the process of merging the two companies prior to the closing date of the financing round. Additional information about the merger will be released in the upcoming weeks.
The investment at Natchitoches is phase one of a three phase development programme that will increase the plant production capacity to one million tonne per year.
River Basin Energy has received a MOU to provide a further 500,000tpy to 2,000,000tpy of biocoal. The MOU will be converted to a binding off-take agreement after trial samples from phase one operations have been received and evaluated by the buyer as being of the same quality or better than samples already made available from the RBE reactor.
Biocoal l is a torrefied product used to generate heat and electrical power for residential and industrial purposes. Biocoal is a sustainable alternate to coal in most circumstances. Biocoal has a commercial advantage over whitewood pellets as the energy cost is about the same and the CAPEX requirements to convert an existing plant to biocoal is significantly lower.
This story was written by Liz Gyekye, editor of Bioenergy Insight.