Rentech to cancel remaining shipments to Drax
Aug. 15, 2017 - Rentech is in the midst of negotiations with UK utility Drax to cancel its outstanding wood pellet shipments for 2017, which amount to 193,000 metric tonnes, the company said in its quarterly report.
August 15, 2017 By Maria Church
Rentech idled its Wawa, Ont., facility and lowered production at its Atikokan, Ont., facility earlier this year in response to equipment and operational issues. The pellet producer has since emptied its Wawa facility to deliver 12,000 metric tonnes of pellets to Drax, and is now looking to cancel its remaining obligation of 193,000 metric tonnes for this year.
“We are currently negotiating with Drax to cancel the remaining shipments in 2017. At this time, we cannot make a determination if any penalties will be associated with future changes to the contract. Rentech, Inc. has guaranteed the payment obligations of the Drax contract up to a maximum amount of CAD$20 million,” the company stated in its quarterly report.
Rentech’s industrial wood pellet revenues slipped to $3.2 million for the second quarter of 2017, compared to $6.5 million for the second quarter of 2016. Operating loss was $2.7 million for the second quarter of 2017, compared to $6.6 million for the same period last year, mainly because of the company’s decision to idle its Wawa plant.
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