Cindrigo is developing an integrated operation that combines upstream biomass production, including wood chip and wood pellet activities, with downstream heat and power generation.

Key info

Cindrigo holds a 50-year lease (expires 28 February 2074) on the Kaipola Biomass facility in Finland. The core of the facility is a 110MW Combined Heat and Power (“CHP”) plant, which has a 25MW electricity and 85MW steam production capacity. The region offers an abundant supply of sustainably sourced biomass and positions Kaipola to become a key revenue-generating asset through multiple complementary revenue streams, including heat, power and biomass product sales, with further expansion over time.

The Directors estimate that the assets held under the Lease can be attributed a depreciated replacement value in the region of €80 million to €120 million.

Strong Market Demand

The Finnish biomass market is undergoing a period of significant structural change and increased demand. Changes in industrial energy consumption patterns, growth in renewable electricity generation and the conversion of coal-fired facilities to sustainable fuels are expected to release significant volumes of energy wood into the market, improving feedstock availability and cost profiles.

Cindrigo’s management expects these changes to release up to 8m tonnes of energy wood per year. With this level of available raw material, Finland could support the development of a wood pellet industry of around 2-4m tonnes per annum – similar in size to Nordic and Baltic peers like Sweden.

Alongside this, European demand for sustainably sourced wood pellets is increasing. The continuing transition toward more sustainable energy sources, backed by EU renweable energy policies, is driving demand for wood pellets as a replacement for coal and “greening” energy production. Domestically, demand from the recent conversion of Helsinki’s Salmisaari A power plant has doubled domestic pellet demand in the last year and already exceeds Finland’s existing wood pellet production.

Cindrigo is well-positioned to leverage growth in the biomass sector through Kaipola by integrating downstream and upstream biomass operations.

Integrated operations

Kaipola integrates upstream biomass production through its partners with downstream heat and power generation, delivering operational, cost and commercial synergies. This gives Cindrigo greater operational control, increased revenue potential, and strengthens the Company’s role within the growing Finnish and broader European biomass market.

Alongside this, Kaipola will supply heat/steam to industrial customers in close proximity utilising existing piping. During winter, heat will also be supplied to the neighbouring village of Kaipola.

Electricity will be distributed to the national power grid through Nord Pool, a leading power trading company across Europe, and can be delivered to local industrial customers as required.

Future Growth

By integrating downstream and upstream biomass operations, Cindrigo is building a robust position within Finland’s biomass market that enhances the scale, resilience and earnings visibility of its operations. This places Cindrigo in a strong position to benefit from developing biofuel production and the ongoing innovations in sustainable fuels.