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Oil Capital
EPIC: AEG
Market: AIM
52-week High/Low: 3.50p / 1.86p
Sector: Energy
Market Cap: 18.97M

Active Energy Group Plc (AIM: AEG.L) is a London Stock Exchange-listed firm, operating internationally across the entire timber supply chain - from forest to fuel.

Our complementary business divisions provide timberland development services for forestry owners and second-generation biomass coal replacement fuels for industrial power generators.

Headquartered in the United Kingdom, Active Energy is a fast-expanding business with an innovative forward-looking strategy designed to together to optimise resources and opportunities, to maximise efficiencies and ROI, and to deliver lasting value to all stakeholders.

Active Energy Group PLC

www.active-energy.com

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Big picture - Why invest in Active Energy Group PLC

Active Energy Group PLC Snapshot

 

CBC NEWS U.K. timber business has sights set on Northern Peninsula read here 

 

Active Energy Group Plc is a public company listed on the AIM market of the London Stock Exchange (AIM: AEG.L).  The company operates internationally across the entire timber supply chain - from forest to factory and fuel.  Through its network of business units across Europe and North America, Active Energy Group Plc is an international supplier of timberland development services for forestry owners, industrial wood fibre for MDF manufacturers, and second-generation Biomass coal replacement fuels for industrial power generators.

With a vertically integrated sourcing, processing and logistics infrastructure - which has enabled the Group to secure the entire timber supply chain from forest to finished product - and a worldwide network of suppliers, partners and customers, Active Energy Group is, under the direction of an experienced international management team, well positioned to continue to grow into a global leader in the Biomass renewable energy, timber processing, and forestry/timberland development industries.

Advanced Biomass Solutions

        

Revolutionary biomass ‘drop-in’ coal replacement fuel for industrial power generation

Coal-fired power plants are widely acknowledged to be the major source - 44%, according to the International Energy Agency 2014 Report - of carbon dioxide and greenhouse gas emissions, the primary causes of global warming and climate change. As a result, governments around the world have introduced increasingly stringent regulations in an effort to force power generators to switch to renewable fuel sources that emit far fewer pollutants and cause considerably less damage to the environment.

The European Parliament has made phasing out coal a major priority, committing member states to a 20% reduction in greenhouse gas emissions and to ensuring that 20% of their total energy consumption is derived from renewable sources by 2020.

These efforts are already bearing fruit: global coal use decreased by at least 2.3% in 2015, and is expected to continue to fall.  However, during the transition to a decarbonised future and the elimination of fossil fuels, governments have a duty to deliver their citizens secure, reliable and cost-efficient energy. Immediately shutting down coal-fired power stations would lead to a dramatic fall in electricity generation capacity, with potentially catastrophic economic and sociological consequences.

According to the IEA Clean Coal Centre, there are over 2,300 coal fired power plants worldwide (7,000 individual units). To date, the only method of reducing the harmful emissions they produce was to install expensive chemical scrubbers, or to modify them - ‘retro-fitting’ - to burn renewable fuels, typically biomass.  One of the best-known examples is the Drax power plant in the UK, which has committed to spending some £700 million (~US$905 million) on converting three of its coal-fired generating units to burn biomass, and a similar amount to establish fuel manufacturing facilities in the US to supply them with feedstock.

Biomass - a carbon neutral renewable energy source derived from plant- or wood-based matter, which provides an 85% net saving on carbon dioxide emissions compared to coal - is an effective alternative to coal, and already accounts for some 60% of European Union renewable energy production. But enabling coal-fired power plants to burn biomass without costly retro-fitting has long been the ‘holy grail’ of the power generation industry.

Advanced Biomass Solutions is the world’s first ‘drop-in’ biomass fuel that can directly replace coal completely - or be co-fired at high percentages with coal - in industrial power plants, without requiring any furnace, logistics, handling or storage modifications.

Uniquely, Advanced Biomass Solutions’ fuel possesses comparable energy (BTU) levels to coal, and has similar handling and friability characteristics, which combined with greatly-reduced low- and mid-volatiles post-production makes it safer to handle than traditional biomass pellets or other fuels.

The result of seven years of extensive research and development, for which 17 ‘greenfield’ patents have already been filed, Advanced Biomass Solutions is set to transform the power generation industry and propel biomass into the energy mainstream.

It enables coal-fired power plant owners to significantly reduce pollution levels and greenhouse gas emissions, immediately benefitting the environment and improving air quality; and allowing them to continue generating power while complying with new emissions regulations.

Uniquely, the Advanced Biomass Solutions manufacturing technology works with any plant- or wood-based biomass material, including previously-unusable timber (branches, bark and forestry thinnings), sawmill waste (contaminated or aged sawdust and offcuts) and industrial timber (construction and demolition waste, chemically-impregnated wood and railway sleepers/railroad ties); by removing contaminants in an organic process that leaves no harmful residues.

Aside from producing high-energy fuel with similar characteristics to coal, the Advanced Biomass Solutions process provides several key advantages over existing biomass fuel pelleting solutions. They include high volume throughput, lower production costs, the ability to supply the finished feedstock in different formats (pellets, granules, briquettes and bales) and - crucially - greatly reduced storage, handling and distribution costs, as the final product is hydrophobic (i.e. water-resistant).

 

Timberlands International

        

 

Forestry asset management and development for timberland owners and operators

Timberlands International is focused on the sustainable development, management and operation of forestry assets worldwide.  It allows forestry owners to maximise the value of their standing timber assets and provides a sales outlet through its affiliation with Advanced Biomass Solutions, which transforms forestry waste into a revolutionary new biomass product. 

Active Energy Group entered into an innovative joint venture with three Métis Settlements of Alberta, Western Canada, to exclusively commercialise in excess of 300,000 hectares (circa 750,000 acres) of forestry assets owned by them.  The forests are projected to contain more than 35 million m3 of mature standing timber, as well as low-grade timber suitable for a range of industrial applications.

The primary aims are to utilise, in a sustainable and responsible manner, the Métis forestry assets to produce biomass-based renewable energy fuel using Advanced Biomass Solutions’ technology; to assist the Province of Alberta in reducing its dependence on highly-polluting coal-fired power generation; and to create a positive investment environment and significant economic development opportunities for the Métis Settlements and their members.

Alongside constructing and operating a plant for on-site production Advanced Biomass Solutions’ coal replacement fuel, other commercial options under consideration for the Alberta Métis economic development project include providing timber for a range of sawmill and industrial applications.

The Timberlands International team intends that this pioneering joint venture will be a model for further agreements with public and private forestry owners worldwide, enabling them to work together to value, develop and commercialise timber assets in an environmentally responsible and sustainable manner, in accordance with international forestry stewardship criteria.

Commercial options include selling long-term tree farming permits with long-term cutting rights to independent timberland investors and timber industry firms, joint venture arrangements with third parties to create on-site logging and processing operations, and utilising low-grade timber and forestry thinnings for local production of Advanced Biomass Solutions coal replacement fuel.

 

AEG WoodFibre

        

High-quality processed hardwood and softwood wood fibre for MDF manufacturing

Medium-Density Fibreboard - generally referred to as MDF - has become the material of choice for carpentry, cabinet-making and other joinery applications.  Formed from a combination of hardwood and softwood wood fibres, which are glued under heat and pressure, it is stronger than plywood or chipboard and can be easily cut, drilled, machined and filed.

Since large-scale manufacturing commenced in the early 1980s, MDF production has grown dramatically, and today stands at circa 85 million m3 per annum; 50% of it produced in China, and 25% in Europe.

Turkey is the largest manufacturer of MDF in Europe, producing over 5 million metric tonnes in 2014 from six major plants, most of which are located close to the Black Sea.  In that year, the country’s MDF output was estimated to be worth more than US$2.5 billion, and is forecast to grow 8% per annum to reach over US$3 billion in 2017.

Although much of its MDF production is destined for overseas markets - one manufacturer operates the largest MDF manufacturing complex in the world, and exports its products to over 40 countries - Turkey is also the largest European consumer of MDF panels, with local consumption in 2013 increasing by 7% to 4.4 million m3.

Over the past few years, Active Energy Group’s wood fibre processing division, AEG WoodFibre, has become a major supplier of raw material - in the form of high-quality wood chip - to several of the leading Turkish MDF manufacturers; and is now the largest exporter of processed wood products from Ukraine.

AEG WoodFibre operates from a dedicated state-of-the-art production facility at Yuzhny Port, near Odessa on the Black Sea, from where it produced and shipped over 150,000 metric tonnes of industrial wood chip in 2014, more than double the volume that it achieved in 2013, and this growth is expected to continue into 2015 and beyond.

Under the direction of an expert local management team, AEG WoodFibre has secured long-term hardwood and softwood supply contracts - primarily non-saw logs/technical lumber and forestry thinnings - with the State Forest Resources Agency of Ukraine; and now receives and handles some 200 rail wagons, each containing more than 40 tonnes of raw timber, at its Yuzhny Port facility every week.

Having demonstrated to its clients that it can reliably supply bulk quantities of high-quality fresh material in one-tenth of the time taken by alternative transatlantic supply sources - thus providing them with significant freight cost savings and cashflow advantages - AEG WoodFibre has committed to a large-scale investment programme to significantly increase its wood chip manufacturing capacity, and to introduce a new softwood product range.

The impact of this investment is already being reflected in its results from Q4:2015 onwards, and AEG WoodFibre expects to continue to grow both its volumes and operating margins - as well as its share of the Turkish MDF raw material supply market - over the coming years.

Richard Spinks Chief Executive Officer, Active Energy Group Plc

Richard Spinks is a seasoned entrepreneur, with a proven track record in business development within the hi-tech, food processing, agriculture and forestry/biomass industries.

He has worked in Central and Eastern Europe since 1980, gaining vast experience and a network of high-level contacts across different industry sectors in a number of emerging markets, including Russia, Ukraine and Poland.

Richard was a pioneer in the emerging Internet industry, and was Director of Business Development at Lycos Bertelsmann GmbH in the late-1990s, before founding and serving as Chief Executive Officer at Vavo.com, an innovative social media platform. From 2001-2004 he held a number of roles at British Seafood Plc, successfully developing it to become one of the largest sector companies in both the Polish and Russian markets.

Prior to his appointment as Chief Executive Officer at Active Energy Group Plc in 2012, he founded and served as Chief Executive Officer (2004-2009) at Landkom International Plc, the first AIM-listed company in the agricultural sector, based in Ukraine.

 

Brian Evans-Jones Chief Financial Officer, Active Energy Group Plc

Brian Evans-Jones is a qualified Chartered Accountant, with many years international experience working with start-ups and established businesses across a broad range of industry sectors.

After graduating with a B.Sc (Econ) Honours degree in International Politics from the University of Wales, he trained and qualified with Coopers & Lybrand (now PriceWaterhouseCoopers), before joining a provincial accountancy practice, which he subsequently took over. From 1995 to 2003 he ran his own professional practice, specialising in SMEs, business consultancy and tax planning.

Since that time he has acted as a consultant to, officer of, and investor in a number of businesses in the food, manufacturing, construction and property sectors across the UK, Europe and CIS, including several turn-around situations and early stage companies. His clients have included Harsco Inc., Ensemble Combined Services, Celtic Oriental, Boditronics, Ty Nant Spring Water (where he was a Founder and Finance Director) and Seconds Ahead. Before assuming his position at Active Energy Group, he was retained as a consultant and advisor on several new business opportunities that the company continues to explore.

 

Michael Rowan Non-executive Chairman, Active Energy Group Plc

Michael Rowan is a qualified solicitor, experienced investment manager and successful corporate financier with a broad range of international commercial and legal contractual experience.

After graduating from the University of Cambridge, he practised as a solicitor at Linklaters in London, Hong Kong and New York, working with leading global financial institutions. He then moved to Merrill Lynch International in London and New York, initially as Vice President & Senior Legal Counsel of Equity Capital Markets, before being appointed Director/Co-Head of the Syndicate Desk, Equity Capital Markets, with responsibility for origination, execution and commercial negotiation of equity and equity-linked transactions, including major privatisations in the UK and EMEA regions.

Since then he has held a number of senior roles within the Venture Capital, Mid Cap Broking and Asset Management sectors with Accelera Capital, Numis Securities and Charles Stanley Securities in London and Hong Kong; and was most recently Business Development Director and Investment Manager at JM Finn & Co, where his responsibilities included strategic advice and investment management for equities, bonds, collectives, small cap and alternative assets. He was also a Non-Executive Director at Voiamo Group Plc, a global provider of advanced mobile data connectivity and communication solutions.

His current Board-level roles include Director and Partner at RD Active Capital Limited and Rowan & Associates Limited, private companies that specialise in international micro capital and seed financing opportunities; and Chairman of Environmental Recycling Technologies Plc.

Significant Shareholders

Total Shares In Issue: 824,791,769.

 

Registered Office:
Active Energy Group Plc

27-28 Eastcastle Street
London
W1W 8DH
United Kingdom
Company No. 03148295

Head Office:
Active Energy Group plc

Mwldan Business Park
Bath House Road
Cardigan, Ceredigion
SA43 1JY, United Kingdom
Tel: +44 (0)1239 621 867

Corporate Head Office:
Active Energy Group plc
Mwldan Business Park
Bath House Road
Cardigan
Ceredigion
SA43 1JY
United Kingdom

Tel: +44 (0)1239 621 867
Web: www.active-energy.com

Registered Office:
Active Energy Group Plc
27-28 Eastcastle Street
London
W1W 8DH
United Kingdom
Company No. 03148295


Company Registrar:
Share Registrars Ltd
Suite E
First Floor
9 Lion and Lamb Yard
Farnham
Surrey GU9 7LL


Tel: 01252 821390
Web: www.shareregistrars.uk.com


Company Secretary:
Cargil Management Services Ltd.
27-28 Eastcastle Street
London
W1W 8DH

Tel: +44 (0)207 637 5216


Nominated Adviser and Broker:
Northland Capital Partners Limited

Tel: +44 (0)20 3861 6625
Web: www.northlandcp.co.uk


Solicitors:
DWF LLP
20 Fenchurch Street
London
EC3M 3AG

Tel: +44 (0)333 320 2220
Web: https://www.dwf.law
DX: 584 London - WT


Auditor:
Jeffreys Henry LLP
Chartered Accountants and Registered Auditors
Finsgate
5-7 Cranwood Street London EC1V 9EE

Tel: +44 (0) 207 309 2222
Web: www.jeffreyshenry.com/

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