The US-based waste-to-SAF producer Fulcrum Bioenergy, along with its three US subsidiaries, filed for Chapter 11 bankruptcy protection earlier this month.
The company had previously announced plans to develop the Ellesmere Port facility in northwestern England, with a slated capacity of 100 million liters per year of SAF once it begins operations in 2027.
The project received major backing from low-cost UK airline Jet2 in 2023, which gave the airline an equity stake in the new SAF facility and a guarantee that it would receive more than 200 million liters of SAF over a 15-year period.
“As we announced in April 2023, production of SAF is expected to commence at the Fulcrum NorthPoint facility in 2027-2028, and there is no change to these plans,” a Jet2 spokesperson told Fastmarkets on Tuesday September 17.
The plant had also received backing from the UK government, which in 2022 earmarked it as one of five waste-to-SAF facilities to receive an investment of approximately £16.8 million ($22.16 million) through the Advanced Fuels Fund as part of the country’s wider goals to decarbonize the aviation sector.
When asked what the company’s bankruptcy filing meant for the future of the government’s investment in the project, a Department for Transport spokesperson told Fastmarkets on Wednesday, September 18, that it remained “dedicated to securing the long-term future of the UK aviation industry and is supporting a number of potential sustainable aviation fuel projects through the Advanced Fuels Fund.”
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The grant issued by the government runs only until 2025.
A NorthPoint SAF press person said that the plans for the plant remained in place, but was unable to provide any further comment.
Fulcrum’s US website, meanwhile, was taken down sometime after May 22, 2024.
Fastmarkets understands that the NorthPoint SAF facility is a standalone facility in terms of financing, so while its future remains uncertain, plans may not be impacted by the bankruptcy announcement.
Meanwhile, Fulcrum BioEnergy’s bankruptcy proceedings, which are taking place in the US, form part of a “stalking horse” asset purchase agreement with Nevada-based technology company Switch, Inc.
Chapter 11 bankruptcy is a court-monitored restructuring of a company’s debts and assets, to try to avoid the company going out of business. Many US companies have filed for Chapter 11 bankruptcy and survived, such as General Motors and United Airlines.
A stalking horse agreement in Chapter 11 bankruptcy proceedings is an initial bid for the purchase of a distressed company, and is intended to protect debt holders by preventing unduly low bids.
Fulcrum had been operating its first facility, the Sierra plant, outside of Reno, Nevada, and was also developing a plant in Gary, Indiana.
A significant contributor to the company’s failure was liquidity, Fulcrum said this week.
The company’s Sierra plant “experienced certain equipment issues following its initial operations in December 2022, which delayed the plant’s full-scale operations,” the official bankruptcy filing said.
