Stobart announces feedstock agreement with Greensphere Capital
The board of Stobart is pleased to announce that Stobart Biomass Products Ltd. has entered into an exclusive master framework agreement with Greensphere Capital LLP for the supply of up to 1 million metric tons of biomass fuel per annum into existing and future biomass power plants.
Stobart has worked closely with Greensphere over the past 18 months in the renewable sector and together they have identified a number of existing and potential biomass projects for possible investment by funds managed by Greensphere.
Greensphere Capital will be investing in a national platform of waste biomass power plants, to which this Framework Agreement will provide fuel. Greensphere Capital manages capital on behalf of institutional investors, including the U.K. Green Investment Bank. In 2012, Greensphere was awarded a fund management mandate by the GIB for waste and waste-to-energy investments.
The master framework agreement specifies the terms that individual supply contracts with specific plants will adopt and although at present there is no minimum volume commitment the expectation is that volumes will grow over the coming three years, as plants are acquired and developed. In addition to the income generated by Stobart Biomass for the supply of the fuel the group will generate revenues from transporting the product and from supporting each new project through to commissioning.
A key element in the success of biomass projects is the provision of a long-term, reliable, sustainable fuel supply. Stobart Biomass is able to meet these demanding requirements and this capability was recognized by Greensphere early on when they decided to invest into this renewable market.
"We believe Greensphere is the ideal partner for Stobart Biomass in this rapidly expanding market and whilst we continue to work with a number of other plant developers this agreement promises to underpin a sizeable element of our biomass supply strategy,” said Andrew Tinkler, CEO of Stobart.