Biofuels firms have insisted that projects are on-course and most of the proposed plants will become operational by 2008, despite reports that City investors’ enthusiasm for the emerging biofuels sector has cooled as crude oil markets have slackened and wheat prices risen.
Bioethanol Ltd has unveiled a deal with farm management company Velcourt and grain marketing co-operative Humber Grain to supply its planned £80m bioethanol plant at Immingham on Humberside.
The joint venture with Centaur Grain now has enough contracted fuelstock to meet its needs in its first two years of operation. Bioethanol Ltd and Centaur now plan to close the contract at the end of March.
Bioethanol Ltd said two years’ worth of committed fuelstock put the plant ahead of other biofuels projects under development, with its planning proposal under consideration and funding negotiations at “an advanced stage”.
Chief operating officer Andrew Morris said its wheat contract with Centaur partly underpinned the company’s business model.
“We remain on course to complete construction of our bioethanol plant before the end of next year.”
Meanwhile, energy firm Ensus’ proposed bioethanol plant on Teeside is believed to have all but secured its necessary funding.
Grain trader Glencore has agreed a long-tern deal to supply the plant with the 1.2m tonnes of wheat it will require each year, but has not yet unveiled any contracts to tempt farmers.
Glencore’s Nick Oakhill said a contract would only be issued when the project’s finances had been finalised.
Teeside is also understood to be the focus of American energy firm Losonoco’s interest in a bioethanol factory.
The proposed £60m plant, pegged to come on-stream by the end of 2008, would create additional demand for locally grown fuelstock in its first years.
Andrew Hartley of Stokesly-based Vireol, which has plans for two 150,000t ethanol plants on Teeside and in Yorkshire, said there was some scepticism about biofuels but there was nothing stopping the firm’s progress.
Green Spirit Fuels, which has advanced plans for its first factory at Henstridge, Somerset, and another site earmarked on the Humber estuary, has announced radical changes to its management board.
Managing director Malcolm Shepherd and finance director Arthur Llewellyn have stepped down on agreed terms following a “strategy review” with Green Spirit’s parent company Wessex Grain.
New chief executive Simon Wilcox said: “GSF has a really strong and experienced operational team who are all very motivated, but perhaps lacked the experience necessary in financial project management and operating in the City that will be required for this project.”
Mr Wilcox said the firm was progressing on raising equity to begin construction on the Henstridge plant later this year. If successful, the factory is expected to begin bioethanol production in autumn 2008.