Enviva signs long-term off-take wood pellet contract
Enviva Partners, a US-headquartered wood pellet producer, announced the execution of a new take-or-pay off-take contract to supply wood pellets to Lynemouth Power, a subsidiary of Energetický a průmyslový holding (EPH).
Lynemouth Power plans to convert its 420 megawatt coal facility in the UK to wood pellet fuel by the end of 2017. Deliveries under this contract are expected to commence in the third quarter of 2017, ramp to full supply of 800,000 tonnes per year in 2018, and continue through the first quarter of 2027.
The contract volumes are denominated in US dollars except 160,000 tonnes per year denominated in British pound sterling. This transaction significantly extends the weighted average remaining term of the Partnership’s off-take contracts to eight years as of 1 June, 2016.
“Our strategy is to fully contract our production capacity, and this contract provides additional length and diversification to our sales book,” said John Keppler, chairman and CEO.
He added: “We are proud that a world-class energy group like EPH selected Enviva to supply more than half of the wood pellets required annually by its Lynemouth facility, further reinforcing our position as a preferred supplier to top-tier biomass projects.”