Negotiations ongoing to find partner for Global Renewables

Speaking to letsrecycle.com on Monday (October 13), Tony Adamson, head of business development at Global Renewables Lancashire Ltd, said: “The discussions are still ongoing. The process is not constrained by a timescale – it will take as long as it takes.”

In August, GRD Group announced interim financial results which showed that Global Renewables – which comprises operations in both Australia and the UK and holds Lancashire's £2 billion waste PFI contract – made a first half loss of nine million Australian dollars (over £3 million) before interest and tax.

The performance was partly attributed to the business development programme in the company's UK market, as well revenue constraints at the company's Eastern Creek facility in Australia and costs associated with “lower diversion and technical developments” at the facility.

As a result, GRD announced that it was looking for a “strategic” partner for the business, with chief executive Cliff Lawrenson commenting: “While the result from our Global Renewables division is disappointing, it reaffirms our previously stated strategy to restructure this part of the business.

“We are currently seeking a strategic partner for Global Renewables and discussions are underway with several interested parties in both Australia and the United Kingdom. We are on track for a conclusion by the end of the year,” he added.

Commenting on how the situation might affect Global Renewables' operations in the UK, Mr Adamson told letsrecycle.com that it was “business as usual”, adding that: “We don't foresee any difficulties here or with the Lancashire project. It is all going extremely well.”

Mr Adamson added that while the company was very successful in bringing home the Lancashire PFI project, it took up to two to three years to go through the procurement process for such large deals which meant that a long-term view was required.

And, he said the company was bidding for more contracts at the moment- but could not reveal what they were at present, stating: “we have put in some expressions of interest.”

Commenting on UK end markets for the main output of its mechanical biological treatment technology (the UR-3R process) – known as Organic Growth Media – Mr Adamson explained that Global Renewables was “pursuing a number of outlets” – but would not disclose what these were.

He said: “We can't get an exemption from the EA to use it on land until we have some material so it's a chicken and egg situation.”

Treatment 

Despite Global Renewables' overall financial performance, Mr Lawrenson insisted that UR-3R was “an internationally recognised advanced waste treatment solution”, and said that technically the plant had performed well in Australia, but that the gate fee had been too low.

He said: “If we were to receive fair market revenue, Eastern Creek would be making a profit. In comparison, the contract for the Lancashire Waste Project provides a more realistic gate fee and target diversion rate. We are redoubling and broadening our efforts in regard to Eastern Creek.”

Lancashire county council said this week that it was confident that Global Renewables' financial position and its parent company's search for a partner would have no effect on its PFI deal. A spokeswoman for the authority said: “GRD's hope to secure a strategic partner is a commercial issue and is not linked to the Lancashire contract. We do not believe that it will have any detrimental effect on our project.”