Drax to enter acquisition process for Louisiana Pellets
Drax has notified its investors that following the conclusion of a March 30 auction, it has been provisionally successful in its bid to acquire the assets of Louisiana Pellets in Urania, Louisiana.
Drax announced on Feb. 27 that it would participate in separate processes for the acquisition out of bankruptcy for the operating assets of the plant, as well as those of Texas Pellets in Woodville, Texas.
German Pellets, builder of both plants, filed for bankruptcy protection in February 2016.
The Louisiana plant, commissioned in early 2015, has a reported production capacity of 578,000 metric tons, and though German Pellets reported plans for an expansion project to its double capacity, it was not completed.
The Texas plant, which began operating in 2013, has an annual production capacity of about 500,000 metric tons. It leases a five-silo pellet storage facility located at Port Arthur, Texas, which can hold 75,000 tons of wood pellets and includes a loading device for vessels up to Panamax size, or about 60,000 tons, according to previous statements by German Pellets.
The auction price was $35.4 million, according to Drax. A court hearing to approve the auction result is scheduled to take place in early April, with completion of the sale expected by the end of the month.
Drax said the sale out of bankruptcy process of the assets of Texas Pellets has been postponed, though the company remains an interested party in the acquisition.