New £650m biomass plant on Teesside to start construction within weeks

Work on a £650m biomass energy plant on Teesside that is predicted to deliver hundreds of jobs will start in a matter of weeks. 

MGT Power has finalised funding for its Tees Renewable Energy Plant and the factory, at Teesport between Redcar and Middlesbrough, will be one the world’s largest biomass power stations, providing electricity for 600,000 homes by burning wood chips and pellets imported mainly from the US. 

Site preparation work is set to begin in the next few weeks, with construction work expected to start by the end of 2016.

The plant, which is due to send its first energy to the National Grid in 2020, will create around 100 permanent full-time jobs, including port handling and offloading and support at least 600 construction jobs. 

MGT bosses say that hundreds more jobs will be strengthened across the local supply chain, with PD Ports’ Teesport base lined up to support the scheme and Stockton energy and process industry company, PX Group, contracted to support construction work. 

Darlington’s Whessoe Engineering will also provide assistance from its position within South Korea’s Samsung Construction and Trading (SCT) and SCT will construct the plant alongside Spain’s Tecnicas Reunidas. 

MGT Teesside chief executive Ben Elsworth said: “This project has had to overcome many hurdles but we have now successfully reached the next stage despite the difficult financing environment. Support from the local region and a big team effort from all the different parties involved has been instrumental in getting there. We can’t wait to get work started and make this project a huge success for Teesside.” 

Elsworth said that MGT had previously received approval from the European Commission for an agreement with the Department of Energy and Climate Change to guarantee a fixed electricity price for 15 years. 

He was also keen to stress that more local jobs would be created as a result of the factory’s boiler plant being provided by Amec Foster Wheeler, which runs its European engineering base in nearby Darlington and has offices in Middlesbrough.

Macquarie Capital and Macquarie Commodities and Financial Markets and the Danish pension fund, PKA, have become joint owners of MGT Teesside and will manage the plant. 

Mark Dooley, Macquarie Capital Europe’s head of infrastructure, utilities and renewables, said: “We are delighted our partnership with MGT will enable the delivery of this important project for the North-East economy. We are committed to supporting the UK’s move to green energy and we see the Teesside Renewable Energy Plant as a key component of this transition.”

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