UK-headed renewable energy major Drax Group plc (Drax) has announced that its Canadian subsidiary Pinnacle Renewable Energy Inc has agreed to acquire the pellet sales contract book of compatriot Pacific BioEnergy Corporation (PacBio), adding 2.8 million tonnes of orders for sustainable biomass supply to high-quality counterparties in Japan and Europe.
According to a statement, these contracts are for delivery between 2022 and the mid-2030s, of which 300 000 tonnes are for delivery in 2022. The total incremental revenues over the contract period are around CA$675 million.
The deal complements the Group’s existing supply contracts to Asian counterparties and European generators, increasing the Group’s long-term third-party sales book by 15 percent, to around 23 million tonnes, with total revenues of over US$4.5 billion.
This deal supports Drax’s ambition to double our sales of sustainable biomass by 2030 to markets in Asia and Europe where demand for biomass is increasing as countries transition away from coal. It also demonstrates Drax’s commitment to the growth of sustainable biomass in Japan specifically, where we expect to establish a new office in 2022. We look forward to working with our partners in Japan and other markets across Asia and Europe as part of our aim to be a global leader in sustainable biomass, making an even greater contribution to the world’s efforts to reach net zero, said Will Gardiner, CEO, Drax Group.
As recently announced, Drax aims to double sales of biomass to third parties to at least 4 million tonnes per annum by 2030, developing its market presence in Asia and Europe, facilitated by the creation of new business development teams in Tokyo, Japan, and London, the UK during 2022.
