Enviva: Chesapeake terminal to resume operations by June 30

By Erin Voegele | April 16, 2018

Enviva Partners LP has announced its deep-water marine terminal in Chesapeake, Virginia, is expected to resume full operations by June 30 following a previously announced fire that damaged the facility on Feb. 27

John Keppler, chairman and CEO of Enviva, sent a special letter to investors on April 9 providing an update on the operational and financial implications of the fire.

“Thanks to the extraordinary work of the Enviva team onsite at our Chesapeake terminal following the February 27th fire, we currently expect the terminal to return to full operation by June 30, 2018,” Keppler said. “Moreover, given the flexibility that our portfolio of multiple plants and ports provides, we have met and expect to continue meeting every customer delivery required this year under our off-take agreements. Importantly, as we believe substantially all the costs of the incident are recoverable, we are reaffirming full-year 2018 per unit distribution guidance of at least $2.53, with continued quarter-over-quarter increases expected throughout the year.”

In the letter, Keppler stresses that no one was injured during the incident and notes the fire was quickly controlled due to the efforts of onsite personnel and the Chesapeake terminal’s fire suppression and mitigation processes, with assistance from local fire departments and other first responders. “I am pleased to report that the site continues to be safety incident free since that time and our neighbors in the community do not appear to have been impacted,” he wrote.

Keppler said preliminary investigations indicate that the fire began in equipment near the top of one of the concrete storage domes, and then spread to inventory in the domes. “We deployed a purpose-built nitrogen fire suppression system in the domes to disperse liquid nitrogen, which limited the combustibility of the inventory,” he wrote.

According to the letter, the approximately 43,000 tons of inventory that was onsite at the time of the fire is a total loss. The letter also notes that the process of emptying the domes of this product is now complete.

Assessments are currently ongoing. Keppler said the company currently believes the most significant physical damage to the terminal assets is limited to the conveyors and handling equipment required for loading and storing product in the domes. The truck receiving assets and downstream conveyors and shiploader appear to be unaffected. In addition, the structural integrity of the domes appears to not have been impacted.

Shortly after the fire, Keppler said Enviva’s logistics teams commissioned temporary storage and shiploading operations at a terminal in Norfolk, Virginia. Production from the company’s mid-Atlantic region is currently being delivered through this port and the Port of Wilmington, North Carolina.

A full copy of the letter can be found on Enviva’s website