The Council of State approved a deal that expands the Ports’ profile in the highly competitive wood pellet industry. The North Carolina State Ports Authority Board of Directors approved the same agreement last week.
The agreement between the ports and WoodFuels would allow for construction of a wood pellet export facility at the Port of Morehead City. According to terms of the agreement, WoodFuels would finance and build a $25 million export facility at the port to receive, store and load wood pellets for export to Europe, where they would be used as a renewable energy source.
Under the 20-year agreement, the facility would receive its first pellets for shipment in late 2014. After the initial operational year, revenue will range between $1.2 million and $2 million annually. On average, this deal could result in $840,000 annually in Ports operating revenue that would be used to reinvest into the Port of Morehead City. It is also expected to support at least 150 direct and indirect jobs between the port and other North Carolina locations.
According to forest-industry experts at N.C. State University, US production of wood pellets is expected to increase from 3 million tons just four years ago, to nearly 10 million tons by 2015. With its vast amount of renewable and sustainable wood fiber sources, North Carolina is an attractive location for wood biomass plants. Earlier this year, the Authority completed a deal with Enviva Holdings to construct and operate a similar facility at the Port of Wilmington. That facility is scheduled to open in early 2015.
“North Carolina is well-positioned to be part of an emerging biomass industry, and continued improvements at our state ports will help tremendously,” said Agriculture Commissioner Steve Troxler. “In addition, new opportunities such as this one will help revitalize our state’s forest products industry.”