New contracts increase contracted backlog to $6.9 billion and introduce second customer in South Korea.
July 15, 2019 By Pinnacle Renewable Energy
Pinnacle Renewable Energy Inc. today announced that it has entered into two new long-term, take-or-pay off-take contracts with customers in Japan and South Korea, both being accelerated growth markets for Pinnacle.
The contract in Japan is an extension of an existing contract with Mitsubishi Corporation, a global integrated business enterprise in Japan. Under the terms of the contract, Pinnacle will supply 110,000 to 120,000 metric tons per annum (MTPA) of industrial wood pellets to Mitsubishi beginning in 2021.
The contract in South Korea is with GS Global Corporation (GS), a large diversified conglomerate in South Korea and the first dedicated biomass independent power producer in that country. Under the terms of the contract, Pinnacle will supply 100,000 MTPA of industrial wood pellets to GS beginning in 2022.
“These new contracts represent the strengthening of our relationship with Mitsubishi and expansion of our business in the Asian market, with the relationship with GS marking our third contract in South Korea,” said Rob McCurdy, CEO of Pinnacle. “With the growth of our contracted back-log and diversification of our counterparties, we are continuing to evaluate and develop further opportunities to add incremental production capacity, supported by our recently expanded credit facility.”
Japan is a supportive market for renewable energy, targeting 3.7 per cent to 4.6 per cent from biomass or 20 million MTPA in pellet equivalent terms, providing Pinnacle with a compelling opportunity to continue growing in this market. Like Japan, South Korea has also set specific targets for renewable generation, seeking to achieve 10 per cent renewable generation by 2023.
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