IN THE NEWS

Louisiana Gov. John Bel Edwards and Origin Materials, a carbon-negative materials company committed to the global transition to sustainable materials, announced that the company plans an investment of at least $750 million to develop a biomass manufacturing facility in Ascension Parish that will result in 1,057 new direct and indirect jobs.

The plant in Geismar will utilize sustainable wood residue sourced partly from Louisiana’s timber mills and managed forests—to produce plant-based polyethylene terephthalate (PET) used in packaging, textiles, apparel and other applications. Hydrothermal carbon, which can be used in fuel pellets, also will be produced at the site.

Made with renewable feedstocks, Origin’s patented technology platform is designed to reduce the carbon emitted during the production of widely used products ranging from food and beverage containers to parts for the automotive industry.

The project will create 200 direct jobs with an average annual salary of more than $90,000 plus benefits. Louisiana Economic Development estimates an additional 857 indirect jobs will result in Louisiana’s Capital Region. The company estimates 500 construction jobs will result at the peak of development for the new facility.

The plant will be located on an LED certified site—the 150 acre Parks Geismar site in Ascension Parish—signifying that it has been deemed development-ready after an extensive review. The company expects construction to begin in mid-2023 and for the plant to be mechanically completed and operational by mid-2025.

“The demand for ‘net zero’ enabling materials is extremely strong, and we believe this plant will be instrumental in addressing demand for our products in the United States and internationally,” Origin Materials Co-Founder and Co-CEO John Bissell says. “We are grateful for the partnership of Louisiana Economic Development, the Baton Rouge Area Chamber and Ascension Parish for the support they have provided in the site selection process.”

The site sits along the Mississippi River with easy access to barge and rail and plentiful local wood residue feedstock. The proposed incentive package for building in the area is compelling and the local industrial cluster can provide access to hydrogen, ethylene, water treatment and more.”

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Headquartered in West Sacramento, Calif., Origin Materials was founded in 2008. The company has partnered with leading consumer brands including Danone, Nestlé Waters and PepsiCo in its creation of recyclable, plant-based PET plastic consumer products, as well as Ford Motor Co. and global chemical companies. This largest-of-its-kind Geismar-based facility will join the company’s network of locations, including its West Sacramento pilot facility and its Ontario, Canada production site, which is currently un der construction.

NewLife Forest Restoration LLC has raised new funding to scale its forest restoration activities and reduce the incidence of catastrophic wildfires. The company closed a $200 million “sustainability-linked” bond financing to fund the expansion of NewLife’s wood products manufacturing facilities and forest restoration capacity, enabling a significant increase in annual acreage restored. The “sustainability-linked” bond issued by the Arizona Industrial Development Authority is one of the first of its kind in the U.S. “green bond” market and mandates specific forest restoration targets.

“These funds transform our company’s ability to lift Arizona’s forest restoration efforts to the much-need ed level of scale,” says New Life CEO Ted Dergousoff. “Not only will we accomplish our core mission, which is to restore the health of the forests and prevent wildfires, but we will make the whole industry sustainable and profitable.” NewLife has developed a manufacturing system to extract value from the low-quality fiber removed from the forest as part of its restoration initiatives. The expansion program will dramatically increase the total industry processing capacity within the Four Forests Restoration Initiative (4FRI) operating area, enabling large-scale forest restoration efforts across Arizona. The company will restore 25,000 acres of forestland per year, dramatically expanding the capacity to proactively address the rising concerns of wildfire.

Through its subsidiary, NewLife is contracted by the U.S. Forest Ser vice (USFS) as part of the 4FRI. The landscape scale restoration project was designed to combat the impact of climate change and reduce the risk of catastrophic wildfire by restoring the forests to a more natural state while protecting large healthy trees, wildlife and the watershed.

NewLife has managed Phase 1 of the 4FRI contract, the nation’s largest forest stewardship contract, since 2017 and partners with the USFS on mechanical thinning initiatives throughout Arizona, with plans to expand to neighboring states.

The company will use the proceeds of the bond to complete the build-out of its 425,000 sq. ft. industrial facility in Bellemont, Ariz., which will include a new high-speed sawmill, planer mill, and dry kilns. NewLife will also double the capacity of its engineered wood products (EWP) plant and significantly expand the capacity of NewLife’s Lumberjack sawmill located near Heber, Ariz.

NewLife is majority owned by Lateral Investment Management, a San Mateo, Calif.-based private equity investment firm focused on transformational growth companies in the U.S. middle market. Lateral has invested more than $100 million in NewLife and was a participant in the bond offering.

As part of its 2021 annual report, Enviva announced the signing of a 15-year take-or-pay off-take memorandum of understanding to supply a new European industrial customer

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seeking to displace lignite coal usage with wood pellets across production facilities in continental Europe and the United Kingdom. Delivered annual volumes are expected to ramp to approximately 600,000 metric tons per year (MTPY) by 2030, with initial deliveries starting in 2023.

Enviva also announced the signing of a new five-year take-or-pay off-take contract with an existing customer, for the delivery of 90,000 metric tons in 2022 and 180,000 MTPY from 2023 through 2026

During 2021 Enviva expanded its production capacity by 17% to 6.2 million MTPY.

On both a recast and non-recast basis, Enviva generated full-year 2021 net revenue of $1.04 billion as compared to net revenue of $875 million for 2020. The $166.7 million increase in net revenue was primarily attributable to a $168.7 million increase in product sales revenue on sales volumes that were 16% higher year-over-year

On January 24, 2022, Enviva successfully closed an equity offering to prefund capital expenditures related to development projects as the company accelerates the pace and scale of its organic growth expansions. Enviva raised gross proceeds of $346 million in a primary equity issuance. l Given the quality and size of its current customer sales pipeline, Enviva believes it will be able to support the addition of six new fully contracted wood pellet production plants and several highly accretive expansion projects, which, over approximately the next five years, would roughly double current production capacity. Enviva projects that total capital expenditures will range from $255 million to $275 million for full-year 2022, with investments in the following projects: —Greenfield site development and construction projects, ranging from $210 million to $220 million —Highly accretive expansion projects, ranging from $30 million to $35 million —Maintenance capital for existing asset footprint, ranging from $15 million to $20 million

Advances continue to be made by regulators, policymakers, utilities, power generators, and difficult-to-decarbonize industries towards achieving net-zero emissions. This progress, combined with favorable legislative and policy recommendations supporting substantial incremental utilization of sustainably sourced biomass, reinforces the growing long-term market opportunity for Enviva’s product around the world. l Favorable policy tailwinds in Japan continue to support further growth in this important market for Enviva. The Japanese Ministry of Economy, Trade and Industry (METI) is progressing plans to increase the share of renewable power in its energy mix.

The European Union’s Emissions Trading System (EU-ETS) continues to demonstrate a dur able, constructive market for carbon. The EU’s commitment to ambitious emissions-reduction goals, together with EU-ETS reforms included in the Fit for 55 package, suggest that trend will continue. EU-ETS prices have more than doubled over the last 12 months, with the forward curve steadily above €85/metric ton, allowing biomass to continue to be significantly more cost effective for energy generation than carbon-intensive feedstocks, natural gas, even in markets where there are no direct incentives or subsidies for renewable energy generation. l Enviva plans to double its production capacity over the next five years, from 6.2 million MTPY to approximately 13 million MTPY by building and commissioning two plants at a time (up from the

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historical rate of one plant per year) and increasing the nameplate production capacity of new plants to approximately 1.1 million MTPY (up roughly 45% from the previous standard of 750,000 MTPY).

At Enviva’s Lucedale, Miss. plant, which is the first plant in its Pascagoula cluster, wood deliveries have commenced and commissioning is underway. Lucedale production will ramp throughout 2022 and, as volumes build at the Port of Pas cagoula terminal, Enviva expects shipments from the completed terminal to commence in the second quarter of 2022. Volumes shipped out of Pascagoula are expected to increase throughout the year as Luce dale’s production ramps to its designed run-rate of 750,000 MTPY of wood pellets by the end of the year. Additionally, in the first half of 2022, Enviva plans to commence construction of the fully contracted 1.1 million MTPY plant in Epes, Ala., the second plant in the Pas cagoula cluster.

Enviva plans to accelerate the timing of a third wood pellet production plant in its Pascagoula cluster, with construction estimated to commence during 2023. Enviva continues to make progress in its evaluation of a new plant potentially at a site in Bond, Miss., with a capacity to produce between 750,000 and more than 1 million MTPY of wood pellets, feeding into the Port of Pascagoula. Enviva anticipates making a decision on the site by the middle of this year.

Drax Group is ramping up to full production at Leola—the first of three new satellite pellet plants it plans for Arkansas. Leola, in Grant County, is part of a $40 million investment by Drax in the state, creating approximately 30 new jobs across all the three sites planned for Arkansas as well as many more indirect jobs.

Including Leola, Drax’s operates six pellet plants in the U.S., which use biomass sourced from sustainably managed working forests in Louisiana, Arkansas and Mississippi. The pellets are used at Drax Power Station in England to generate renewable electricity for millions of UK homes and businesses.

The three satellite plants in Arkan sas are expected to produce a total of 120,000 tonnes of wood pellets per year from sawmill residues. This supports Drax’s plans to double its pellet production capacity to 8 million tonnes

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by 2030 to meet its own requirements, as well as its customers’ needs in Europe and Asia, amid an expected increase in global demand for the low-carbon fuel.

The satellite plants are located near sawmills, so they can use the sawdust and other byproducts. Construction of the second Arkansas satellite plant in Russellville, Pope County, is underway with commissioning expected this year. Drax is continuing to develop plans for a third plant.

The pellets produced at the new satellite plants will be transported to Bruce Oakley terminal in Little Rock, Ark. before being shipped south to Louisiana to oceangoing vessels. Each pellet plant is expected to produce 40kt per year. Drax plans to increase its annual pellet production capacity to 8 million tonnes by 2030 from around 4 million tonnes currently and is doubling global pellet sales to 4Mt by 2030 to meet an expected increase in global demand for the low-carbon fuel.

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Oregon Court of Appeals heard arguments in late February on a 2019 jury decision appealed by the state that awarded $1.1 billion to 13 counties and 151 local taxing districts after the counties sued the state of Oregon and Oregon Dept. of Forestry, claiming officials reduced timberland management goals and violated the law that created much of the state’s forest system.

Legal language from 1941 when many counties returned timberland to the state required that the lands be managed for the “greatest permanent value.” The counties claim ed the state reduced timber harvests in favor of other values and owed the counties for 20 years of missing timber revenues—and for future lost revenues through the year 2069.

According to the counties, the Oregon Dept. of Forestry adopted a rule in 1998 that redefined “greatest permanent value” to mean managing for sustainable ecosystems and environmental benefits in addition to economic revenues. The rule change violated the original law, the counties’ legal team argued, and cost the counties $674 million since 2001 and a projected $392 million in future damages through 2069 if the rule isn’t changed. A Linn County jury agreed.

The verdict has been under appeal since, collecting interest at 9% a year. A three-judge panel heard oral arguments from the two

sides. The counties claim that timber production was the main objective in 1941 and remained so until the late 1990s. At that point, they say the state breached its contract with the counties when it adopted new administrative rules that included a broader definition of greatest permanent value. Since then, they contend, the state has shortchanged them by under-harvesting on state forests and undercutting their revenues.

The state appealed the verdict on a variety of grounds. The chief argument was that the statutory term in question—greatest permanent value—is not contractual, and even if it is, does not mean what the counties assert: that they have a right to maximum revenue.

Peak Renewables Ltd. has named Scott Bax as CEO. Bax is responsible for Peak Renewable’s hydrogen and OSB activities throughout North America, including the recently announced One Sky Forest Products OSB plant to be built in Prince Albert, Saskatchewan, a partnership between Peak Renewables and 12 Indigenous Nations.

Prior to joining Peak, Bax spent eight years with Pinnacle Renewable Energy, most recently as COO, where he grew the business three-fold to more than 2.5 million MT of annualized wood pellet production and revenue in excess of $400 million.

A leader who prioritizes people, relationships, accountability and results, Bax brings more than 25 years of experience of forestry and wood manufacturing operations throughout Canada and the U.S.

“I am excited to be joining a talented and committed team engaged in the vital economic growth and renewables space,” Bax says. “Under Brian Fehr’s visionary leadership, I am focused on safely and sustainably growing a business that yields benefits to workers, communities, indigenous peoples, the environment and investors.”

Fehr, who is Peak’s founder and Chairman, adds, “Scott brings experience, passion and leadership to help elevate Peak Renewables as a difference maker and major player in the renewable forest economy. A relationship-oriented leader with proven results, his approach Scott Bax

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