Tidewater acquires UCO supplier, makes 2nd BC LCFS credit sale

Tidewater Renewables announced Jan. 10 that it recently closed a $3.5 million strategic acquisition of a used cooking oil supplier, the material from which will be converted to fuel at its renewable diesel and renewable hydrogen complex in Prince George, British Columbia, Canada, scaled to produce 46 million gallons per year. The deal for ownership of the 12-year-old Alberta, Saskatchewan-based UCO supplier with 1,200 collection points was made with cash and common shares of Tidewater Renewables stock.

“Tidewater Renewables plans to aggressively grow the acquired business and has already improved realized pricing by approximately 15 percent since closing the acquisition,” the company stated, adding that it continues to advance other feedstock-supply arrangements and long-term partnerships to secure sufficient feedstock for its Prince George complex and other initiatives.

The company also announced a second sale agreement with a second investment-grade company to sell British Columbia Low Carbon Fuel Standard credits at an average price of $478 per credit that it will receive through the construction of the Prince George complex, at values higher than previously budgeted. It has agreed to sell a total of 25,000 BC LCFS credits at an average price of $478 per credit compared to the first sale at $425 per credit and the previously budgeted value of $375 per credit, for credits to be received under an agreement with the government of British Columbia.

“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,” the company stated. “With this transaction Tidewater Renewables has now agreed to sales for over 50 percent 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 multiyear agreements to monetize further credits that it will receive from the construction and operation of the complex, from its canola coprocessing facility, and from other projects.”