Active Energy, the London quoted renewable energy business focussed on biomass, is pleased to announce that it has entered into a joint venture agreement (the “JV”), with Renewable Logistics Systems LLC (“RLS”), a supplier of saw-logs, pulpwood and wood chips to international and domestic markets. The JV will enable AEG to enter the saw logging export market via the commencement of operations at the Company’s Lumberton Site, in Robeson County, North Carolina (“Lumberton”) and will also provide further revenue opportunities for the Company.
Highlights
- Pursuant to the terms of the JV, AEG and RLS have incorporated Renewable Energy Systems LLC (“RES”) as an LLC to enter the saw-logging export market and to handle forthcoming logistics operations at Lumberton.
- AEG will have an initial 30% equity share in RES and a right to increase this to 49%, when a 50 tonne per hour (‘tph’) CoalSwitch™ plant which AEG expects to be operational before the end of 2020.
- Forestry waste products from RES’s activities at Lumberton will be utilised as an additional feedstock resource for the production of all pelletised fuels including CoalSwitch™.
- RES will manage the material handling within Lumberton for AEG and the transportation services for the delivery of production of both saw logs and pellets to customers.
- RES will enter into contracts for products from Lumberton and anticipates generating short term revenues from the export of the saw-logs.
- Lumberton will be the initial operating site for RES.
- AEG estimates the throughput of RES activities will be in the range of 200-500 containers per month of saw-logs for the export market, equivalent to 5,000-15,000 m3 per month.
- As per the Company’s announcement of 26 June 2019, AEG and RLS have an existing lease agreement; pursuant to the terms of the JV, the leased area will increase to cover 30 acres generating further rental income for Company.
Michael Rowan, CEO of Active Energy Group, said,
“This JV with RLS is another important milestone and represents a further complimentary revenue stream for AEG. It also establishes an additional source of feedstock supply for the production of pelletised fuels, and importantly accommodates all the near-term logistics requirements for Lumberton for the supply of existing and new pelletised renewable fuels to customers.
“Revenue from the JV will be utilised for the future development of Lumberton and further demonstrates the value of our new operational centre, as it provides valuable commercial opportunities for the Company through being an industrial hub located strategically in the heart of America’s forestry industry.”
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