The owners of Bioénergie AE Côte-Nord, which has been sheltered from its creditors for nearly a year, are asking the government for $30 million in tax credits and financial assistance to support the plant’s revival, the creation of a sector and the resumption of activities at the Arbec sawmill in Port-Cartier.
Recently, Bioénergie AE, owned by Ensyn and Biogaz, filed a brief in anticipation of the Legault government’s budget. Biogaz is made up of Groupe Rémabec and Produits Forestiers Arbec, which are partly owned by members of the wealthy Saputo family.
In recent years, the Bioenergy AE plant project, which plans to produce biofuel from forest biomass, has been criticized for its numerous delays and unpaid bills.
So much so that the company’s debts amount today to $115 million, according to the trustee in the file, Raymond Chabot.
Bioenergy AE required investments of $104 million, including $44.5 million from Ottawa and a guaranteed loan of $22 million from Investissement Québec.
Reached by Le Journal, the president of the company, Serge Mercier, indicated that his organization believed more than “ever in the future of this new industry in which Quebecers can become a reference”.
Stop production
Since the start of production in 2018, the Bioénergie AE plant, whose activities are integrated into the Arbec sawmill, has never managed to reach its targets. Management hoped to produce 40 million liters of bio-oil from forest residues per year.
The company cited equipment problems as the reason for his chaotic departure. This situation has also led to a legal tussle with the equipment manufacturer Envergent/UOP/Honeywell.
All production has been stopped since March 2020.
So far, shareholders say they have reinjected $5.3 million into the recovery plan. Equipment issues should be resolved by March.
According to the owners, “depending on the demand for biofuel”, the resumption of the activities of Bioenergy AE could allow the “gradual relaunch” of the Arbec sawmill in Port-Cartier, which closed in 2020.
Bioenergy AE asks the government to increase the tax credit for the production of pyrolytic oil, to extend the tax credit program for five years as well as support of $3 million per year, over the next five years, “in order to launch the sector on a solid foundation and encourage investment for the construction of additional factories”.
“These requests to the Government of Quebec are modest, in the order of 6 million per year, over the next five years,” writes the management.
Bioenergy AE Côte-Nord
- Investment of $104 million
- $44.5 million from Ottawa
- $22 million from Investissement Québec in the form of a guaranteed loan
- $115 million in debt
- Under the Creditors Arrangement Act since May 2021