Drax Group acquired the remaining 10% of the shares in Alabama Pellets on 3 October. The seller was Two Rivers Lumber of the same location. The purchase price was US$22m in cash. The transaction is due to be completed before the end of October. The acquisition of the outstanding 10% share boosts Drax’ arithmetical annual pellet output by around 66,000 t. The previously existing long-term agreements for raw-material deliveries with the neighbouring sawmill operator have been extended as well.
After the takeover of Pinnacle Renewable Energy Group completed in mid-April 2021, Drax initially held 70% of the shares in Alabama Pellets. Another 20% was then acquired from The Westervelt in July. The two works in Aliceville and Demopolis, with a technical production capacity of 270,000 tpa and 360,000 tpa, respectively, belong to Alabama Pellets. Drax produced a total of around 3.1m t of pellets with its existing activities in North America in its business year 2021. In December 2021, Drax announced its intention to increase its annual pellet capacity to 8m t by 2030.