WAYCROSS, Ga. (AP) -- A large producer of wood pellets that are burned for electricity is buying a pellet plant in southeast Georgia for $175 million.
Enviva Partners of Bethesda, Maryland, announced last week that it would buy the Georgia Biomass plant in Waycross, as well as export terminal capacity that Georgia Biomass leases at the Port of Savannah. The Waycross plant began operating in 2011 and has a capacity of 800,000 metric tons per year.
Enviva is also transferring ownership of its Greenwood, South Carolina, plant from a related entity to itself, paying $132 million and taking on $40 million in debt. The Greenwood plant began operating in 2016 and exports its pellets through Wilmington, North Carolina. Enviva plans to spend $28 million to increase the Greenwood plant's output to 600,000 metric tons per year by the end of 2021.
The two acquisitions will increase capacity by 35%, the company said.
Buyers, typically European and Japanese electrical utilities, have contracted for the full capacity of the Waycross and Greenwood plants through 2035, Enviva said. The utilities typically get credit for reducing carbon emissions by burning wood pellets, although some dispute the environmental benefits.
Enviva is privately selling $200 million in ownership units in its limited partnership to finance part of the acquisitions. The company will borrow the rest of the purchase and expansion price of $375 million.