26th Jan 2015 07:46
LONDON (Alliance News) - Stobart Group Ltd Monday said it had won a 14-year index-linked fuel supply agreement, worth more than GBP110 million in total, to supply a new 40 megawatt waste wood-fuelled biomass plant near Margam, South Wales, its largest supply contract by volume.
In a statement, Stobart said Margam is scheduled to start operations in March 2017, and Stobart's energy unit will source, process and supply 250,000 tonnes a year of recycled waste wood to Margam over 14 years, or about 3.5 million tonnes over the life of the agreement. Stobart Energy's transport business will also be responsible for transporting the product, delivering 250 loads each week to Margam over the 14-year agreement, generating additional revenue division.
Stobart said the deal means that it has now secured half the increase required to achieve its energy unit's fuel supply target of 2 million tonnes a year by 2017/18, double the amount the unit currently supplies.
"Coupled with the recent successful financial closure on the group's Widnes Biomass Project, this agreement confirms we are firmly on track to achieve our strategic aims in this sector and reinforces our position as the number one supplier of biomass in the UK," Stobart Energy & Infrastructure Chief Richard Butcher said in a statement.
The plant in Wales will be built over the next two years, with commissioning scheduled for early 2017 and operations set to start in March of that year. Stobart said it won't be involved in the financing for the project.
By Steve McGrath; [email protected]; @stevemcgrath1
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