Enviva Partners LP might expand wood pellet production capacity by 2 million tons

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Enviva Partners LP, the world's largest supplier of power generation wood pellets, has decided to raise US$ 100 million in an initial public offering, nasdaq.com reported. After the offering, Enviva will have the right of first offer to acquire wood pellet production plants from Riverstone/Carlyle with production capacity of 2.0 million metric tons per year (MTPY). So far, Enviva owns and operates five production plants in the Southeastern US with a combined wood pellet production capacity of 1.7 MTPY.

Enviva claims that utility-grade wood pellets are increasingly becoming a global energy commodity, used as a substitute for coal in both converted and co-fired power generation and combined heat power plants. It is larger than any competitor, producing 16% of global utility-grade wood pellet supply.

Demand for wood pellets is set to grow from 9.9 million MTPY to 38.0 million from 2013 to 2020 driven by higher conversion of coal-fired power generation to co-fired or biomass-fired plants in Northern Europe as well as Korea and Japan.

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