Active Energy raises £3.4 million to accelerate development of US focussed biomass business
LONDON: Active Energy, the London quoted international biomass based renewable energy business, has raised £3.439 million through the further subscription of Series B convertible loan notes by both existing as well as new European and Asian institutional investors.
The net proceeds of the Fundraise will be utilised primarily to accelerate the construction of a 5 tonne per hour ('tph') CoalSwitch™ plant at the Company's 151 acres industrial site in Lumberton, North Carolina.
In addition, the funds will support the planning and engineering work streams that are required for a further 50 tph plant and support additional complementary activities including saw logging which will open up additional revenue streams for AEG.
Lumberton is being developed to be the Active Energy’s first permanent production facility for CoalSwitch™, AEG's proprietary technology that transforms low-cost biomass material into high-value green fuels, and to serve as the primary base for all its biomass fuel operations in the U.S.
The first 5 tph plant, which has been shipped from the Company's original Utah site, is targeted to become operational in Q4 2019. This will create further revenue for Active Energy and follows the recent execution of two lease agreements for AEG at the Lumberton Site which will generate combined annual rent of US$264,000 from the site.
Michael Rowan, Active Energy Chief Executive said, "This £3.4 million funding will enable us to accelerate the construction of our 5 tonne per hour plant and the subsequent delivery of first commercial CoalSwitch™ product, which will drive revenues in the short to medium term and mark a watershed in the Company's development.
"As stated previously, we are building a next generation biomass business and the Fundraise is another strong vote of confidence from investors regarding the commercialisation strategy of our innovative products, coupled with our broader growth strategy. We have come an extremely long way in a relatively short period of time and we are now focused on building out our operational capacity and developing the Lumberton Site, which includes carrying out the engineering studies for our next plant that has a targeted capacity of 50 tph as well as securing future revenue streams. We executed two lease agreements at the end of June that will provide an immediate source of income and we also recently secured a five-year contract for the supply of up to 800,000 tonnes per annum of feedstock to Lumberton.
"I am confident that we now have a secure platform for growth and I look forward to providing further updates on our progress at Lumberton in the coming weeks."