Renegy signs LOI to acquire operating biomass power generation facility
January 1, 1970
BY Bryan Sims
Web exclusive posted April 23, 2008 at 11:39 a.m. CST
Renegy Holdings Inc. has signed a non-binding letter of intent (LOI) to acquire a 20-megawatt biomass power generation plant from Sierra Pacific Industries for $13 million. The plant, located in Loyalton, Calif., currently sells 10 megawatts of its electricity output to Sierra Pacific Power, a leading electric utility power company serving northern Nevada and northeastern California.
Under terms of the LOI, the sale would also include approximately 50 acres of land at the Loyalton plant site along with existing fuel contracts and all operating and environmental permits for the plant. Renegy expects the transaction to close by June, subject to its completion of final due diligence, entering into a definitive purchase agreement for the plant and other closing conditions.
Renegy's announcement April 14 that it intends to buy the operating Loyalton biomass power plant came four days after it announced a similar LOI has been signed to purchase an idle biomass power generation plant in Ione, Calif., for $5.35 million.
"The Loyalton plant will provide us with an additional source of revenue and anticipated positive cash flow from the plant during the second half of 2008," said Renegy Chairman and Chief Executive Officer Bob Worsley. "Acquiring the plant, together with the Ione plant that we announced last week, will increase the electrical power output capacity of our portfolio of biomass power generating assets to 75 megawatts and advance us toward our goal of building and operating critical mass necessary for Renegy to become a self-sustaining business beginning in 2009."
According to Tempe, Ariz.-based Renegy, fuel for the Loyalton plant is comprised primarily of wood waste provided through long-term contracts with local suppliers. Fifty percent of the fuel is currently derived from sawmills and other forest residue from the surrounding area and the other 50 percent comes from municipal solid waste material accumulated in nearby landfills.
Renegy's current biomass power generating assets include a 24-megawatt facility near Snowflake, Ariz., that is scheduled to begin commercial operations this quarter and an idle 13-megawatt biomass plant in Susanville, Calif., that has the potential to be restarted by the end of this year.
For more information on Renegy and its business operations, visit www.renegy.com/.
Renegy Holdings Inc. has signed a non-binding letter of intent (LOI) to acquire a 20-megawatt biomass power generation plant from Sierra Pacific Industries for $13 million. The plant, located in Loyalton, Calif., currently sells 10 megawatts of its electricity output to Sierra Pacific Power, a leading electric utility power company serving northern Nevada and northeastern California.
Under terms of the LOI, the sale would also include approximately 50 acres of land at the Loyalton plant site along with existing fuel contracts and all operating and environmental permits for the plant. Renegy expects the transaction to close by June, subject to its completion of final due diligence, entering into a definitive purchase agreement for the plant and other closing conditions.
Renegy's announcement April 14 that it intends to buy the operating Loyalton biomass power plant came four days after it announced a similar LOI has been signed to purchase an idle biomass power generation plant in Ione, Calif., for $5.35 million.
"The Loyalton plant will provide us with an additional source of revenue and anticipated positive cash flow from the plant during the second half of 2008," said Renegy Chairman and Chief Executive Officer Bob Worsley. "Acquiring the plant, together with the Ione plant that we announced last week, will increase the electrical power output capacity of our portfolio of biomass power generating assets to 75 megawatts and advance us toward our goal of building and operating critical mass necessary for Renegy to become a self-sustaining business beginning in 2009."
According to Tempe, Ariz.-based Renegy, fuel for the Loyalton plant is comprised primarily of wood waste provided through long-term contracts with local suppliers. Fifty percent of the fuel is currently derived from sawmills and other forest residue from the surrounding area and the other 50 percent comes from municipal solid waste material accumulated in nearby landfills.
Renegy's current biomass power generating assets include a 24-megawatt facility near Snowflake, Ariz., that is scheduled to begin commercial operations this quarter and an idle 13-megawatt biomass plant in Susanville, Calif., that has the potential to be restarted by the end of this year.
For more information on Renegy and its business operations, visit www.renegy.com/.
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