Equity firm plans bioethanol plant in North East
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London – Future Capital Partners (FCP), a £6 billion alternative investment boutique, has formed a company called Future Fuels to raise £40 million in investment funds for the building of a biorefinery in the North East of England. The facility would have capacity of produce 200 million litres of bioethanol and 175 kilotonnes of high protein animal feeds per annum.
The construction partner for the project is Simon Carves Ltd, part of Punj Lloyd engineering group, which has recently completed the Ensus biorefinery at Wilton on Teesside. This facility, which is in the commissioning phase, is similar to the plant proposed by FCP, the investment firm said.
A major global investment bank has already agreed a £1bn purchase for the first ten years of production, while a global commodities trading firm has made a £500m commitment over the same period to purchase the animal feed produced, according to FCP. The firm is promising investors returns of 30% per annum over the five to seven year period of the plant’s construction – largely from a trade sale or IPO upon the commissioning of the plant.
Presenting the business case for the project, FCP highlighted how EU and UK directives require locally produced bioethanol to comprise 13% , or 23 billion litres, of all the UK’s transport fuel by 2020 – up from the current 2 billion litres, or 3.5%. In addition, the firm noted that BP and Shell had put biofuels at the centre of of their renewable investment strategies.
FCP said it is undertaking the project with Vireol, which will operate the completed plant under a lease arrangement. The project, added the investment firm, has been peer-reviewed and validated by Imperial College London to help ensure that it is “completely environmentally friendly”.
“Biofuels is the investment opportunity of the future. In the wake of Copenhagen, the global focus on renewable energy is there for all to see, yet opportunities to invest in such an obvious growth sector are currently non-existent,” said Tim Levy, CEO at FCP. “Future Fuels will provide investors with the opportunity to invest in one of only three biofuel production plants in the country.”
FCP specialises in alternative investments such as renewable energy, international property, biotechnology and media and entertainment. The firm’s products and investment opportunities are available to
