Stobart lines up funding for Widnes power station
STOBART has raised the £110m required to start building a combined heat and power biomass plant at its site in Widnes.
Stobart’s infrastructure arm said it is investing £7.5m for a 40% stake in the Mersey Bioenergy plant and will take £2m from the sale of the four-acre site.
The Green Investment Bank will provide 49% of the equity and Burmeister & Wain Scandinavian Contractor, the project’s Danish engineering, procurement and construction contractor, will take an 11% stake.
Investec Bank and Eksport Kredit Fonden are providing a senior debt facility of £42.5m for the development of the plant. Mezzanine finance of £41.9m will be provided by the Green Investment Bank and Gravis Capital Partners.
Stobart’s energy division has signed a supply deal to provide 146,000 tonnes of waste wood every year for 16 years. It will also operate a wood drying facility using heat from the power station, and sell this on to the wood chip and pellet market.
Richard Butcher, chief executive of Stobart Energy & Infrastructure, said: “This agreement secures an attractive energy investment for the group and will contribute 24% of the growth we need to achieve our target of supplying two million tonnes of fuel per annum into the UK biomass market by 2017/18 from one million tonnes per annum at present. It also demonstrates the strength of our integrated infrastructure, energy and engineering capabilities.
“This CHP (combined heat and power) plant will generate a strong return on investment in the plant’s equity as well as providing the group with a 16-year biomass fuel supply contract, a long-term wood drying income stream and valuable engineering revenue on the development.”
