NZ$300 million torrefied wood pellet planned

Plans to build New Zealand’s first plant to produce low emissions fossil free fuel to replace coal have moved a step closer with the signing of an agreement to lease a site at Kawerau. Australian listed company Foresta has announced the signing of a 30-year lease (with a 20 year right of renewal) on a 9.6 ha property in Kawerau with local iwi owned Putauaki Trust.

Foresta plans to invest some NZ$300 million building the plant which at full production will employ more than 100 workers.

“There’s a huge opportunity in New Zealand for our world leading low emissions technology and today we’ve taken a major step forward in our plans,” said Foresta Chairman Henry Cheng. “We’re very excited to play our part in building a greener, more sustainable future for New Zealand by producing our unique low impact torrefied wood pellets.”

The site chosen for the plant is in an industrial zone developed by Putauaki Trust with the support of the Provincial Growth Fund which funded significant roading and other infrastructure improvements.

Foresta is currently negotiating supply agreements with owners of sustainably managed pine plantations. In December, Foresta signed a 10-year agreement with South Island energy distribution company Tailored Energy & Resources Ltd (TERL) to supply 65,000 tonnes of pellets annually to its industrial customers.

The production process produces torrefied “black” wood pellets – involving heating the wood pellets to between 200 and 300 deg C, in the absence of oxygen. A recent Genesis trial at Huntly power station using similar pellets reduced emissions by at least 90%.

New Zealand currently consumes around two million tonnes of coal per annum for industrial processes, electricity generation and commercial heating. Just seven million tonnes of pine feedstock would be used to produce two million tonnes of black wood pellets, which can directly replace the country’s annual coal consumption.

“The fuel could potentially reduce New Zealand’s total annual gross greenhouse gas emissions by 5% while adding 20% value to the country’s forest revenues.” Foresta further adds value by using the underutilised stumps and tops of the trees.

“Today marks a major step forward for Foresta and underlines our commitment to helping New Zealand build a more sustainable and environmentally friendly chemical and energy industry,” said Henry Cheng.

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Source: Foresta