Södra and Statkraft collaborate for biofuels

Renewable energy producer Statkraft, and Södra, a forestry operations company with experience in paper pulp, sawn timber and bioenergy, have signed a letter of intent (LOI) to create a company that will produce biofuels from forest waste.

The agreement will see Statkraft acquire Södra Cell Tofte, which owns the industrial site of the former Tofte pulp plant in Hurum, Norway, where the plant will be located.

'Södra is monitoring with great interest the technology developments and the business opportunities presented by the use of forest raw materials for industrial production of climate-neutral fuels. We have also enjoyed good collaboration with Statkraft in the past and look forward to joining the two companies' expertise and experience in this project,' says Södra CEO Lars Idermark.

The LOI states that Statkraft will take over all of the shares in Södra Cell Tofte, and that Södra and Statkraft will form a new biofuel company. Södra will own a 49% share in this new company and Statkraft a 51% share.

The Tofte industrial site is favourably situated for a future venture into biofuels production. The location has an established infrastructure that can handle large volumes of wood, and it is located centrally in eastern Norway, with a good deep-water port.