All financial information is in Canadian dollars.
Ontario-based Anaergia has retained Jefferies to explore a sale of its Rialto Bioenergy Facility in California as it continues its strategic review, executives said during Anaergia’s earnings call Tuesday. The move comes after the business entity in control of the facility filed for bankruptcy and Anaergia excised the facility from its earnings last quarter.
Anaergia and Jefferies are targeting April 2024 for a potential Rialto sale. During Tuesday’s call, Anaergia executives noted the possibility of reinstating the bonds that finance the facility if a sale does not occur.
CEO Brett Hodson declined to discuss management’s preferred outcome from Anaergia’s strategic review, which he noted was still ongoing. That process has already resulted in substantial changes, including renovating Anaergia’s executive team that brought in Hodson as well as new CFO Andrew Spence.
The company continues to pursue new projects and complete those already under construction. Its Rhode Island Bioenergy Facility closed a $20 million term loan from East West Bank in September, and it is now accepting feedstock and ramping up renewable natural gas production, Chief Operating Officer Yaniv Scherson said on the call.
That facility reached an offtake agreement with Irving Oil at the beginning of the year to supply 350 million cubic feet of RNG to the grid annually, in part to support operations of an Irving facility in New Brunswick. Scherson said Anaergia’s facility ramp-up is continuing on schedule, and he projects that will continue into early 2024. In response to concerns about cash flow, Scherson assured analysts on the call that “payments occur upon first molecules in the grid” for the company’s RNG, thanks to the particularities of Canada’s carbon market.
“We are producing gas, we are ramping up the facility,” Scherson said. “We anticipate a smooth ramp-up.”
Also this quarter, Anaergia retained Piper Sandler & Co. to assist with its strategic review, and it sold its Italian portfolio to lender Arjun Infrastructure Partners. Anaergia continues to pursue opportunities at its SoCal Biomethane facility.