Tidewater Renewables strikes 20-year RNG offtake deal in BC

A majority-owned subsidiary of Tidewater Renewables Ltd (TSE:LCFS) has signed a 20-year renewable natural gas (RNG) offtake contract with a utility in the Canadian province of British Columbia.

Specifically, the deal is between Tidewater Renewables unit Rimrock Renewables LP and energy provider FortisBC Energy Inc. Under its terms, the latter will purchase up to 525,000 gigajoules (GJ) of RNG annually from a new plant in Foothills County near High River, Alberta. The contract underpins 100% of the project's revenue generation.

The deal is subject to regulatory clearance by the British Columbia Utilities Commission, which is seen to decide on the matter in the opening quarter of 2023. If approved and the plant is built, RNG deliveries should begin by the first half of 2024.

The planned RNG production facility will use an anaerobic digestion and gasification process to convert feedlot manure to pipeline-quality RNG. The process will result in negative carbon intensity scores, meaning that it will take more carbon out of the environment than it will produce.

Tidewater Renewables expects the plant to generate CAD 10 million (USD 7.2m/EUR 7.4m) in run-rate earnings before interest, tax, depreciation and amortisation (EBITDA) on a 100% basis.

(CAD 1 = USD 0.724/EUR 0.745)

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