Premium Value BC LCFS Credit Sale
Tidewater Renewables has agreed to sell a total of 25,000 BC LCFS credits at an average price of $478 per credit, as compared to the first disclosed sale at $425 per credit and the previously disclosed budgeted value of $375 per credit for credits to be received under the Renewable Diesel Project Part 3 Agreement with the British Columbia Government. This agreement to sell credits extends to March 2023 and further reduces the value realization risk on a portion of the BC LCFS credits that Tidewater Renewables will receive, realizing total proceeds of over $11.9 million over the term of this agreement.
With this transaction Tidewater Renewables has now agreed to sales for over 50% of credits to be received by the commissioning of the Complex expected in the first quarter of 2023. The Corporation continues to work on other potential multi-year agreements to monetize further credits that it will receive from the construction and operation of the Complex, from its Canola Co-Processing Facility, and from other projects.
Local Feedstock Supply Acquisition
Tidewater Renewables has recently closed the acquisition of a used cooking oil supplier for total consideration of $3.5 million, consisting of cash and common shares of Tidewater Renewables. The acquisition is aligned with Tidewater Renewables’ feedstock strategy of growing its portfolio of discounted feedstocks, particularly those with a low carbon intensity advantage, such as used cooking oil. The acquired supplier is an established Alberta based used cooking oil supplier with 12 years of operations and approximately 1,200 collection points. Tidewater Renewables plans to aggressively grow the acquired business and has already improved realized pricing by approximately fifteen percent since closing the acquisition.
Tidewater Renewables continues to progress other various feedstock supply initiatives and long-term partnerships in order to secure sufficient feedstock for the operation of the Complex and other renewable fuels initiatives being pursued.