Waste-to-biofuel producer gains €50m investment

Canadian biofuel producer Enerkem has announced the closure of its latest round of financing.

Enerkem's planned Varennes facility. Image: Enerkem
Enerkem's planned Varennes facility. Image: Enerkem

The C$76m (€50.7m) funding for the firm has come from Suncor Energy - one of Canada’s largest energy companies - and existing investors, it announced yesterday.

It said that the capital injection will allow it to continue developing its projects in Varennes, Québec, and Rotterdam, Holland, among others.

The main focus of Suncor is on the production of carbon-intensive synthetic crude oil from tar sands. The investment in waste-to-biofuel producer Enerkem is one of its first into decarbonised energy, although it does operate wind farms and has an ethanol facility in Ontario. The firm will also share technical resources to accelerate Enerkem’s growth.

Braemar Energy Ventures, Cycle Capital, Fondaction, Fonds de solidarité FTQ, Investissement Québec, National Bank of Canada, Rho Ventures, Sunkem, the Westly Group and Waste Management of Canada have also extended their investments. So has the Quebec government, which put in an extra C€13.3m (€8.8m).

"We are now in a period of sustained growth and beginning a landmark phase of our technology's implementation, with the expected launch of our Varennes plant and our Rotterdam project," said president and acting CEO Dominique Boies. "Thanks to a strong core of public and private investors, Enerkem has developed a clean, one-of-a-kind technology for commercial use. We are proud of also having the government of Québec's support to be able to pursue our development projects in an emerging and promising sector that is helping to build the new economy."

The firm announced last month that Shell would be joining its Rotterdam project, set to be the first in Europe to turn unrecyclable waste into methanol for use as a chemical feedstock and biofuel. AkzoNobel, Air Liquide, Nouryon and the Port of Rotterdam are also involved. It should be able to process 360,000 tonnes of waste into 220,000t of methanol per year, saving 300,000t of CO2. The final investment decision is due later this year.

The Varennes cellulosic biofuel plant will produce methanol and ethanol from residual institutional, commercial, industrial and construction waste, based on the Enerkem’s first commercial facility in Alberta. It will be built in two phases – the first producing methanol and the second converting methanol into ethanol. Construction should begin towards the end of the year.

Enerkem also has an agreement with the Sinobioway Group to build 100 biofuel plants in China by 2035. The group took an equity stake in Enerkem worth over C€125m (€83m) last year.

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