Enviva Development, a subsidiary of Enviva Holdings has formed a new joint venture (JV) with affiliates of The John Hancock Life Insurance Company (U.S.A.) to buy, develop and build wood pellet production plants and deep-water marine terminals in the Southeastern US.
The new JV will be managed and operated by wood pellets producer Enviva. It will be supported by the Hancock Renewable Energy Group (HREG), a unit of the Hancock Natural Resource Group.
The JV has made a deal to purchase a wood pellet production plant located in Greenwood, South Carolina from The Navigator Company. The acquisition of the plant, which has been in operations since October 2016, is anticipated to be closed in the first half of 2018.
According to Enviva, the new JV will invest in the Greenwood plant to boost its operational efficiency and increase the production capacity.
Enviva president and CEO John Keppler said: “The new joint venture is expected to develop and construct new production plants and marine terminals required to serve the growing Asian and European markets.
“As the plants and terminal assets contemplated in the joint venture become fully contracted and reach commercial operation, we expect to offer them to Enviva Partners, LP, providing additional visibility into the partnership’s potential drop-down inventory.”
Enviva and John Hancock, through their affiliates, will inject capital in the new JV that would be necessary for the purchase of the wood pellet production plant in Greenwood.
The investment will also be used to fund development of a deep-water marine terminal at the Port of Pascagoula, Mississippi and at least two more wood pellet production plants, based on meeting of certain terms and conditions.
Enviva Wilmington Holdings, the existing development JV of Enviva and John Hancock along with Enviva Development will contribute select wood pellet production plant and marine terminal development projects in the Southeastern US to the new JV.
Founded in 2004, Enviva owns and operates six plants located in the southeastern US that have a production capacity of about 3 million metric tons of wood pellets per annum.