RDIF, JBIC to develop wood pellet project in Russia

The Russian Direct Investment Fund and JBICIG Partners, a subsidiary of the Japan Bank for International Cooperation, as part of the Russia-Japan Investment Fund launched by RDIF and JBIC, together with RFP Group and Japan’s Prospect Co. Ltd. have agreed to collaborate and consider potential investments in Russia’s biofuel industry. A corresponding agreement was announced on the sidelines of the Prime Minister of Japan Shinzo Abe’s visit to Russia.

As part of the agreement, the parties plan to cooperate on a project to process timber industry waste into wood pellets for energy production. The project involves the construction of a pellet production plant, with a total capacity up to 135,000 tons per year. Construction of the first facility is expected to start in the summer of 2018, with pellet production to start in 2019. Parties plan to explore further increase of capacity and construction of additional plants with a capacity circa 500,000 tons per year. A significant volume of the product will be exported to Japan.

Kirill Dmitriev, CEO of the RDIF, said, "Russia has great potential for development in the bioenergy industry. We have the largest timber resource in the world. Every year, a large amount of wood is felled. The waste formed during the processing of this wood can later be converted into solid biofuel. Fuel pellets made of wood will contribute to the development of alternative energy sources and enable the Russian Far East to realize its export potential."

Curtis Freeze, CEO of Prospect Co. Ltd., said, "Prospect is very excited to partner and invest with RFP Group, RJIF and all stakeholders to grow Russia's biofuel industry into a major supplier to meet Japan's energy needs. These exports will go far to further strengthen relations between Russia and Japan."