E3 Consulting Plays Significant Role in Completion of Chilean Interconnection Project

The government of Chile announced that the Transmisora Electrica del Norte (TEN), a 600-km-long 500 kV transmission line that connected Chile’s two main transmission systems, Sistema Interconectado Central (SIC) and Sistema Interconectado del Norte Grande (SING) is operational.  E3 served as the Independent Engineer for the interconnection project, which will be responsible for the supply of energy to more than 97% of the national population, with an installed capacity of approximately 24,000 MW and a demand of 11,000 MW.

The E3 team worked with lead banker, IPEX-Bank, along with nine local and international banks, and a U.S. insurance company, on the financing which provided the total debt capital for the equivalent of U.S. $854 million.  E3’s team, led by Jim Galambas and NAES’s Craig DesChenes, began in August 2015.  Mr. DesChenes traveled to Chile throughout the Project, monitoring construction of the transmission line and substations.

In announcing the completion of the new line, simply called the National Electric System, President of the Republic of Chile, Michelle Bachelet noted, “Our country will not have to deal anymore with the absurd situation of having an electrical system in the region of Norte Grande, and a different one between Taltal and Chilo. What we are doing today is to erase that border that abruptly interrupted the electric transmission, which increased prices and inefficiency.”

E3 is currently working on another interconnection project in Chile, having been engaged to serve as the Independent Engineer for Transelec Concesiones S.A.’s Trunk Expansion Projects, which are designed to interconnect the trunk transmission projects in Chile.  Transelec is developing and constructing a Portfolio of three transmission expansion projects in Chile, each of which is in different stage of progress.  For additional information on these projects, please contact James Galambas at james.galambas@e3co.com or 303 762-7072.


E3 Takes On Groundbreaking ‘Green Pulp’ Project in Eastern Washington

Columbia County, Washington, is known for its abundant crops of wheat and alfalfa – but there’s a downside. After each harvest, a massive quantity of waste straw needs to be managed in some way, either by burning it, plowing it under, or baling it for erosion control.

Enter Columbia Pulp, a new firm that promises to put some of that waste straw to better use. Recently dubbed ‘a very big deal’ by The Seattle Times, the project will manufacture pulp for papermaking using cellulose
extracted from the straw through a proprietary process developed by Sustainable Fiber Technologies.

E3 Consulting began working with Columbia Pulp more than two years ago as Independent Engineer when the company sought to gather permits, put agreements into place and raise funding. According to E3 President Paul Plath, who manages the project, Columbia achieved financial close on debt and equity funding in August, allowing it to commence construction of the $184 million mill.

“The Columbia Pulp project makes sense in so many ways, both environmentally and economically,” said Plath. “It will not only eliminate thousands of tons of air emissions from straw burning but will also produce a ‘green’ substitute for wood pulp and pump jobs and tax revenues into the local economy.”

Funding was secured through the sale of $133.6 million in 15-year tax-exempt bonds issued by the Washington Economic Development Finance Authority. Columbia also raised $54 million in equity financing, including $36 million from lead investor Columbia Ventures Corporation, a
private equity firm based in Vancouver, Wash.

The new mill will occupy a 449-acre site near Lyons Ferry State Park on the Snake River. Construction began immediately after financial close in August, with commercial operation expected in late 2018. The mill will
purchase approximately 240,000 tons of straw annually from wheat and alfalfa farmers within a 75-mile radius.

In the project development life cycle, reaching financial close is a major milestone. It means that developers have agreements and funding in hand to proceed with project construction. It can be an arduous process fraught with setbacks, especially if the project will use technology that
hasn’t yet been tested commercially – as was the case with Columbia Pulp. In such cases, E3’s professionals must determine if (a) there’s a high probability of the processing equipment operating as claimed; and (b) if the project is likely to generate a sufficient and sustainable cash stream
to repay the investors and lenders.

To learn more, contact Mr. Plath at 303-762-7061 or at paul.plath@e3co.com.

Financial Close Reached for Pyrolyx AG’s Carbon Black Tire Facility: E3 Consulting Served as Lender’s Technical Advisor

E3 Consulting (E3) served as the lender’s technical advisor in support of the financing for construction of a recovered carbon black (rCB) plant in Terra Haute, Indiana.  The project is being built by Pyrolyx AG, Munich, Germany, the market leader in the extraction of carbon black from end-of-life tires.

Financial close occurred in August 2017. E3 is currently providing construction monitoring services for the state-of-the-art plant, which will recycle tire rubber to produce approximately 12,900 metric tons of rCB yearly.  According to Pyrolyx, its rCB manufacturing process is a cost-effective, sustainable alternative to traditional carbon black, which is produced from crude oil. The conditioned rCB can be used in the manufacture of new tires and in plastic, technical rubber and in masterbatch industries.

The plant will be Pyrolyx’s second, with the other located in Stegelitz, Germany, and is expected to employ 55 full-time staff when it begins commercial operations, expected in April 2019. The company will use the proceeds of $30.2 million in Economic Development Solid Waste Facility Revenue Bonds issued by its U.S. subsidiary, Pyrolyx USA Indiana L.L.C., to fund the construction.

E3 is proud to have been involved in this landmark project, which utilizes Pyrolyx’s breakthrough technology to convert end of life tires into recovered Carbon Black which is recycled for use in tires and other goods, noted Al Rettenmaier, E3’s project manager. Our world needs scores of these facilities to solve the huge tire disposal issues we face. E3’s review focused on technology, engineering, environmental, contracting, primary agreements, project costs and technical assumptions in the operating projections.

For additional information regarding the Pyrolyx Project, please contact Mr. Rettenmaier at 720-833-6342 or ar@e3co.com.