2020-02-25 00:33:18
The worldwide wood pellet industry hit a new milestone on Jan. 16 as Pinnacle Renewable Energy Inc. signed a 15-year charter agreement with NYK Bulk and Projects Carriers to have a brand-new Japanese- built ship transport wood pellets exclusively between Canada and Japan.
“It’s certainly different to how freight has been arranged in the past by any wood pellet company anywhere,” said Vaughan Bassett, Pinnacle’s senior vice-president of sales and logistics.
The S1130 Handy class vessel of almost 40,000 deadweight tonnage (dubbed the M/V New Pinnacle) will transport between 32,500 and 33,000 metric tons of wood pellets six times per year from Canada to Japan.
Japanese Consul General Takashi Hatori took part in the signing ceremony on Jan. 16, as the deal was made possible by a long-term commitment from the Japanese government to purchase pellets from Pinnacle.
“The Japanese government set an ambitious goal of increasing the biomass power generation to make it 2.3 times by the year 2030,” Hatori said. He added that Canada, and in particular B.C., is “the most reliable partner to source wood pellets.”
Unlike Contracts of Affreightment (COA) – which are typical in wood pellet exporting – where a shipping line agrees to carry a certain number of tons from one market to another, this long-term charter will see Pinnacle take on the costs of running the ship, said Bassett. However, that means the New Pinnacle can run exclusively between Canadian and Japanese ports without needing to travel to other ports to source other cargo. The vessel is also built to take the maximum possible load into Japanese ports.
But Bassett did note that, in terms of securing enough supply for their contracts in Japan, “we could certainly build more pellet plants. And in order to do that, we would certainly like more access to more fibre.”
There is more fibre available in B.C., he said. “I’m thinking about things like forest residues, the stuff that’s left behind after harvesting, for example. If it’s within economic reach of our plants, we should be able to access it.”
Bassett said Pinnacle is in talks with the B.C. government to facilitate better access where it makes sense to do so.
Read the full article at canadianbiomassmagazine.ca
-Adam Kveton
©Annex Biomass_CFI_OF. View All Articles.