Australia pellet plant to reopen

By Anna Simet | March 10, 2017

Five years after Plantation Energy Albany made its last pellet shipment to an overseas customer and subsequently shut down, the facility will reopen, according to consulting company Argonaut.

The 250,000-metric-ton-per-year plant is located in Albany, a port city in Western Australia. When the plant closed in 2012, the company cited unfavorable economic conditions relative to U.S. competitors. However, with the lower Australian dollar, increased demand for renewable energy worldwide and clarity of forestry ownership in the Albany region, the plant will be viable and profitable again, according to Argonaut.

The plant has been in care-and-maintenance mode since it shut down. Renewable Heat & Power, owner of Plantation Energy, will continue to work with Argonaut to recommission the facility, after nearly three years of working to do so, which included its purchase back from a private equity group.

RHP’s funding partner is Engie Energy Management, formerly known as GDF Suez.  RHP will use $7 million in convertible note funding to recommission the plant, which is expected to be complete by June, as well as investments into capital requirements for the plant’s operations, including a ship loader and storage facility, and working capital for the return to full operations, according to Argonaut.

Commercial production is expected in the third quarter of this year. When operating at capacity, the facility will employ 30 people.

The Australian Department of Food and Agriculture website states that the reopened facility’s pellets, made from plantation timber, will be shipped to Asian markets where they will be used for generating heat and electricity.