International renewable energy, forestry management and timber processing business Active Energy announced on Monday that it entered into an agreement in principle with the Province of Newfoundland and Labrador in Canada that, if finalised, would provide the company and its affiliate, Timberlands International, with a Crown timber licence and forest management agreement relating to two Forest Management Districts covering 1.2 million hectares.
The AIM-traded firm said that in addition, both parties were evaluating a number of other collaborative opportunities for both Timberlands and Advanced Biomass Solutions - another affiliate company of AEG - involving timber processing and the commercialisation of the CoalSwitch product, which the board said was the world's first 'drop in' biomass fuel that could completely replace coal in existing coal fired power stations without the need for expensive retrofitting.
Active Energy said the Crown timber licence and proposed 20-year forestry management agreement was to harvest and utilise up to 140,000 solid cubic metres of wood annually from the Forestry Management Districts 17 and 18 within the province.
The two forestry management districts have a total land area of 1,211,000 hectares on the Northern Peninsula of the province, the board explained, proximate to ocean port facilities with direct access for shipping routes to Europe.
It said the agreement would facilitate the management and assessment of multiple commercial possibilities for the forests including commercial logging, saw log merchandising, chipping and the production of biomass products utilising forestry waste.
Timberlands was reportedly developing relationships with existing companies engaged in forestry operations and saw milling activities on the Northern Peninsula and surrounding areas, to cooperate with them on further timber related operations and fibre exchanges, it added.
The province and AEG envisaged that the introduction of a broader-based commercial model would contribute to "revitalising" the local economy, the company's board reported.
It said the agreement was in line with Active Energy's strategy to commercialise timberland operations through its newly incorporated affiliate, Timberlands.
"The proposed agreement with the Province of Newfoundland and Labrador represents an important step in the overall strategy for Timberlands in achieving a new and significant partnership in Canada," said AEG chief executive Richard Spinks.
"The Province of Newfoundland and Labrador has been clear in its commitment to the safeguarding and improvement of the regional economy whilst continuing to protect the existing environmental landscape."
Spinks said that, through the province's association with AEG's group of companies, he was confident that the firm could deliver material benefits for all stakeholders by unlocking the value of under-utilised forestry assets, through supporting and enhancing the province's environmental and sustainability criteria, whilst developing commercial benefits in an environmentally-friendly fashion.
"Through our experience and knowledge, we apply modern international-standard forestry practises, supplemented by additional revenue streams, including the utilisation of waste products for the CoalSwitch biomass fuel.
"We believe this agreement can provide significant benefits to all parties and I look forward to providing AEG's shareholders with further updates as we finalise the agreement in the coming weeks."
Corero Network Security updated the market on its recent Tier 1 internet service provider customer win on Monday, confirming that its customer - GTT Communications - had now launched its DDoS mitigation service.