Conifex Timber Inc. has secured $100 million of financing for its stalled bioenergy project in Mackenzie, B.C.
The company halted work on the project in November 2012 when financing dried up, and Conifex has been searching for new funding sources ever since.
The bioenergy project would see an idled newsprint mill transformed into an energy plant, fed by wood waste from two sawmills the company owns in Mackenzie.
Conifex has not specified who the new financiers are. The $100 million will be provided by a syndicate of lenders, the company said in a statement.
Conifex has received oral confirmation of the deal, which it said will be finalized soon. Conifex plans to re-start construction on the power project immediately.
Conifex CEO Ken Shields expects the bioenergy project to boost the company's stock when the switch is finally turned on.
"It is a high return, low-risk investment opportunity that will add certainty and stability to our cash flow generating capability," said Shields during the company's second quarter conference call on August 14.
Costs for the project have risen, from $50 million in 2011 to $98 million today. In June 2011, the company signed a 20-year power purchase agreement with BC Hydro.
The B.C. government promoted the Mackenzie facility as part of its provincial bioenergy strategy when the project was first announced in 2011.
Former forestry minister and Prince George-Mackenzie MLA Pat Bell, who did not seek re-election in the last provincial election, is now a director on Conifex's board.
