Biomass fuel supplier Enviva to expand business with $120m credit facility

Wood pellets and processed biomass fuel supplier Enviva secured $120m Senior Secured Credit Facility to construct new pellet mills and expand business in the US.

Enviva has plans to build of two new 500,000 metric ton a year pellet mills in Virginia and North Carolina and also enhance storage capacity at its deep-water port terminal in Chesapeake, Virginia to approximately 100,000 metric tons

Consequently, the company will extend its operating footprint in the mid-Atlantic, Mississippi and Alabama.

The facility was jointly arranged by Barclays Bank, Goldman Sachs Bank USA and Royal Bank of Canada.

Enviva executive vice president and chief financial officer Steve Reeves said, “This substantial commitment by the Joint Lead Arrangers and the other financing banks is an important step in right-sizing Enviva’s balance sheet.”

With the combined 1.72 million tons of annual capacity projected for 2013, Enviva will fulfill existing renewable fuels long-term supply agreements in Europe.

Enviva chairman and chief executive officer John Keppler said that as global demand for sustainable biomass fuels increases, the midstream supply sector must continue to grow alongside, aggregating and processing fragmented wood resources into high-quality renewable fuels and storing, terminaling and delivering them reliably to customers.

“Enviva and the broader midstream sector are a crucial part of global renewable energy infrastructure. Debt capital alongside the equity capital we and our principal financial sponsor, Riverstone Holdings LLC, have invested and continue to invest is an essential part of funding our growth,” Keppler added.