New Zealand

Following the money

Shoeshine’s attention was caught recently by an anonymous tip to her email inbox.

Have a look at the companies and shareholders behind a controversial waste-to-energy project in the Manawatū, it said, claiming red flags were raised, especially given the involvement of Mum and Dad investors in one company in the group.

But first, a warning: this article is acronym heavy.  

Bioplant Manawatu New Zealand (BPMNZ) has applied to the Horizons Regional Council (HRC) for resource consent to discharge gases into the air from a proposed pyrolysis plant, which would be the only one operational in New Zealand. It has a deal with the Manawatū District Council (MDC) to set it up on council land adjacent to the newly-developed Resource Recovery Centre.

The plant will use pyrolysis to process up to 40 tonnes per day of municipal solid waste (MSW) otherwise destined for landfill. It will produce synthetic diesel and biochar in the process that can be sold commercially along with converting the waste heat into electricity. The pyrolysis process involves heating the feedstock to high temperatures in the absence of oxygen.

There’s a lot riding on this one consent. If the Fielding plant succeeds, the Bioplant group of companies and its Singapore-registered partner Global Green International Investments Pte (GGII) have multi-million dollar plans to have a minimum of 10 plants in New Zealand, Australia and the Pacific in under six years. GGII said it had already been involved in similar plants in South Korea, including at the Hankook Tyre Factory.

Artist's impression of within the proposed Manawatu pyrolysis plant.

Artist’s impression of within the proposed Manawatū pyrolysis plant.

Bio what?

But not everyone is convinced of the economic and community benefits from the Fielding one, nor in the process as proposed.

Opposition to the project has come mainly from locals concerned about the wider environmental impacts and the Zero Waste Network which is opposed to all pyrolysis and incineration technology, calling instead for investment in zero waste systems.

One of the opponents’ biggest beefs is in the name Bioplant itself, given pyrolysis involves no biological process.

Submissions to the notified resource consent hearing held in July largely centred on differing expert views on how well the technology will work, particularly at this scale, and concerns about cultural consultation and information gaps (more on this later).

In a preliminary report to the hearing commissioners, HRC consents planner Bryony Huirua says there’s potential for the consent to be granted, but she stops short of recommending that, saying cultural and public well-being points need to be addressed. 

The hearing has been adjourned for BPMNZ to provide more information, with the hearing commissioners saying they were concerned “as to the clarity of information before us, in order to be able to make a decision”. The company says it will do so by September 7.

Site of Bioplant’s proposed Fielding facility.

The funding

Shoeshine tried to talk to the parties involved in the project, including shareholders, given the many millions of dollars being bandied about.

In a submission to the hearing, group finance director Ming Lim-Pollard says Bioplant’s initial budget is for $36 million per modular pyrolysis plant. She says there is potential in the first three years for an additional two modular systems to be added to the Fielding site.

And a further capital injection of $32m was required to meet the demands of its commercial partners to process the synthetic fuel. Around 100 people would be employed during the plant construction and a minimum 21 jobs created for the plant’s operation, she says.

Additional investment of $180m [for other New Zealand plants] would be forthcoming with the possibility of another 250 full-time and part-time employment growth for the provincial community, iwi and New Zealand, Lim-Pollard says.

“Should this resource consent be approved, BPMNZ hopes it will provide the standard for the rest of our resource consents in future,” she says.

Where the capital for the plants will come from remains unclear. The group’s PR spokesperson Jo Coughlan from Silvereye is the only one fronting up to media and she’s not commenting until after the hearing concludes.

The small shareholders in Bioplant NZ, whose main shareholder Anthony Manu holds the New Zealand licence for the pyrolysis technology, were told not to talk to Shoeshine. Coughlan said the company would be happy to talk later, though “commercial confidentiality” may come into play around questions on financing.

The players

Shoeshine went digging into the company structure for some clues. It gets a little convoluted.

BPMNZ was set up in September 2019 and is part of a network of related companies under the umbrella name Bioplant which operates in Australia, New Zealand, and the Pacific.

Among the five Bioplant companies set up in New Zealand in 2019 and 2020 is Bioplant NZ, in which Manu holds a 67.92% stake while Ilaisaane Manu at the same Mangere address holds a further 10%. The other more than 50 mainly Mum and Dad investors, a large number Pasifika, from New Zealand and Australia are big in number but collectively only hold a minority shareholding. Taupo Tani from Mana Pacific Consultants, who conducted much of the consultation with tangata whenua on behalf of BPMNZ to help gain resource consent, also has a 1% stake.

Bioplant NZ has taken a small shareholding in all the other Kiwi Bioplant companies which also include Bioplant North Island NZ, Bioplant South Island NZ (formerly Bioplant Hokitika), and Bioplant Tairawhiti. It has not been made public what Bioplant NZ’s small investors paid for their stakes, on what terms, and what returns they were promised.

A company associated with Conor English is a shareholder in BPMNZ.

A company associated with Conor English is a shareholder in BPMNZ.

The main players in the other companies include: Lim-Pollard and her husband Kieran Pollard , the chair of BPMNZ; business backer Joe Duncan; Conor English (the brother of former Prime Minister Bill English) and Coughlan; Chris Harre; and Darren Herd. GGII and Australian-based Bioplant are also shareholders in each of the New Zealand companies apart from Bioplant NZ.

The Australian-based Bioplant’s website says GGII is the global head licensor to the rights for the WtE (waste to energy) pyrolysis technology which was developed by it and an unnamed Japanese partner over 10 years. The technology was now in its fourth iteration, it says.

GGII’s directors are Australian-based Allan Clarke (chairman) and Neil Bird, who are both behind Bioplant. The other two GGII directors are Singapore-based Alan Matthews and Lathika Pillay (a company secretary with law firm Baker & McKenzie).  

GGII’s major shareholder is Stoleen Limited, a British Virgin-Islands registered company that doesn’t come up on any Google search. Registering a company in the British Virgin Islands is common for those looking to minimise their tax – about 400,000 companies are registered there. The BVI has a zero corporate tax rate and doesn’t make companies registered there publicly disclose their directors or shareholders.

Other GGII shareholders are Australian entities – McDonald Superannuation Fund (a self-managed superannuation fund), RSI Operations International, and Wavertree Investments which is the trustee for the John Philips family trust. ASIC records show a John Philips is listed as auditor for Bioplant in Australia.

Financial accounts show GGII had zero revenue or cashflow from December 31 2019 to the end of 2021 (the most recent filed). It holds assets though worth US$73.6 million. It made a loss of just under US$1m in the 2021 financial year and has accumulated losses of US$4.5m.

Bioplant Energy’s website says it holds the exclusive licence for the patented pyrolysis technology for Australasia, the South Pacific and Papua New Guinea. Its directors are Clarke and Bird from GGII and its advisory board includes Steve Lambert, an Australian financier who is on the board of a couple of the NZ Bioplant companies, including the Manawatū one.

Bioplant group finance director Ming Lim-Pollard.

Bioplant group finance director Ming Lim-Pollard.

Grand plans

Lim-Pollard’s hearing submission says sites on private land in Hokitika and Tolaga Bay near Gisborne have already been scoped for other New Zealand pyrolysis plants while Bioplant Energy’s website also lists three Australian projects within the state of Victoria – in Ballarat, Laverton and Geelong.

One in Dandenong, touted in 2016 as GGII’s first major project in Australia, doesn’t appear to have been constructed yet. It is unclear how far advanced the other Australian projects are though Environmental Protection Authority Victoria, the state regulator for waste-to-energy projects, says it has no record of Bioplant applying for approval other than a proposal in 2016 that didn’t go through to completion.

Company-commissioned expert Dr Efran Ibrahim’s evidence to the hearing says he’s familiar with the GGII technology that has been used in a number of locations in Korea and Japan from his work for the company on project proposals for Tahiti, Zanzibar, India and Ecuador.

Lim-Pollard, who is a barrister and accountant with years of banking experience, says initially GGII engaged her private financial services provider company Endeavour to help set up Bioplant in Malaysia and New Zealand and later Manu also asked for her help getting it going here.

Lim-Pollard’s submission says the Asia Development Bank and the International Finance Corporation (World Bank) could potentially fund up to 60% of the development costs for similar plants in the Pacific Nations and Southeast Asia countries. She provides no information on how they would be funded here.

MBIE confirmed an application had been made to the Provincial Growth Fund for funding for a plant near Gisborne but it never progressed to decision stage.

The business model

BPMNZ wants approval for resource consent in Manawatū for 21 years (originally it sought 35 years) in order to secure the project’s long-term viability, repay the relevant finance obligations and to align with the potential long-term 20-year lease from the Manawatū District Council, Lim-Pollard ‘s submission says.

Her main concern is the resource consent duration – a 21-year term was required due to the necessary capital spend.

“This is a project finance infrastructure deal and on a commercial basis, our investors and financiers will be looking for a long-term payback period over the lifetime of this project.”

The seven years or 17 years proposed by the HRC was “commercially unfeasible and unrealistic for an investment of this scale”, she says, particularly as it didn’t match the proposed lease of the council land.

The MDC didn’t return Shoeshine’s calls on the planned commercial arrangements for handling of its waste or the land lease.

BPMNZ says it has secured or is securing long-term contracts for what the plant will produce, conditional on getting consent.

The plant could produce up to 14,000 litres a day of synthetic diesel and Lim-Pollard’s submission says its commercial partner for the synthetic fuel was one of the four largest global companies under an 18-year contract.

It also plans a 10-year term contract for waste materials (wood waste and green waste) from private companies or local authorities.

Former New Plymouth mayor David Lean, who has been advising BPMNZ on the hearings process, says he and others are working on a plan to take organic waste out of the mix from BPMNZ and turn it into high quality organic compost.

The venture would have a plant sitting alongside the pyrolysis one, utilising cheap energy from it, Lean says. While not a shareholder in Bioplant, he hopes to become one if the first plant gains consent.

Other contracts BPMNZ is seeking include a 10-year one for purchasing carbon units and a five-year term for electricity outputs. In relation to the 2.5 tonnes per day of char expected to be produced, it’s seeking five-year contracts for it to be used either as activated carbon, conversion to graphene for use in batteries, or to enhance the soil for farming purposes.

GGII chairman Allan Clarke.

GGII chairman Allan Clarke.

Technology argy-bargy

Bioplant’s proposed process involves removing the recyclable material from the waste and the remainder is dropped into a sorting area, goes through a hopper crusher before going through a fine shredder system. The shredded material goes through the pyrolysis process with energy being generated in the generator turbine zone. Combustion gases from the process pass through a treatment system consisting of a semi-dry scrubber and baghouse before being discharged into the air.

Dorte Wray, executive officer for The Zero Waste Network (ZWN), says one of its big concerns was that the proposal was a disposal option, just like landfill.

“It’s another ambulance at the bottom of the cliff and does nothing to reduce the production of waste in order to operate.”

She also says the relatively small number of other sites using the technology and the lack of uptake of this particular technology by other jurisdictions and the abandonment of it by some European countries “should encourage Commissioners to view it with an abundance of caution”.

Simon Arnold is executive director of Nufuels which has small scale pyrolysis systems in the Solomon Islands, making fuels that are fit-for-purpose for local use. He is also Liquid Biofuels Coordinator of the Bioenergy Association of NZ that is closely involved with pyrolysis to produce fuels.

Nufuels had looked at doing a pyrolysis plant locally but the equipment it imported from China didn’t turn out to be up to scratch. Arnold says like most thermos-chemical processes, pyrolysis gets cheaper the bigger the plant gets, but running very large plants close to urban centres creates environmental concerns that are costly to manage. Fuels produced by these systems are expensive to upgrade to replace fossil fuels.

“Basically, the problems are controlling what you feed into it, the reactions you put it through, and what scale you do it at,” he says.

In this regard, he isn’t too impressed with Bioplant’s proposal as it stands, saying it is unclear what the feedstock will contain, (a point raised by other submitters), it definitely won’t be a bioplant producing biofuels, and aspects of the process didn’t seem to be particularly robust.

Expert evidence ZWN secured for the hearing from Dr Andrew Rollinson, a Scottish reactor engineer with decades of experience with pyrolysis technology, was arguably the most damning of that presented. Wray says he basically called the proposal a lemon.

In his summary, Rollinson reckons BPMNZ’s application “contains the repeated use of certain terms and descriptive assertions which are erroneous. It also includes descriptions of pyrolysis which are scientifically incorrect.” He says there are concerns about the site of the proposed plant which overlies or is in close proximity to many watercourses that irrigate farmland and provide potable supply.

“My professional opinion is that overly challenging measures above and beyond what the permit dossier suggests will be needed to obviate adverse environmental impact and harm to public health.”

GGII and Bioplant director Neil Bird.

GGII and Bioplant director Neil Bird.

Caucusing and hot tubbing

Rollinson’s evidence and that of other critics caused a flurry of additional comments in response from the company-commissioned submitters who say Rollinson’s concerns are largely unfounded.

Ibrahim says early models of pyrolysis systems had created excessive waste but, in his view, the Fielding one – in the way it was described in the proposal – was “based on a proven technology with 14 years of error-free operational experience.”

Dr Peng Hong Koh, an advisor on the pyrolysis technology to BPMNZ, says his analysis of air discharges based on South Korean pyrolysis plants he visited in 2019, showed the surrounding environment would suffer less than minor impacts from the proposed Fielding one.

Annual dioxin pollution from heating material at the plant would likely be 0.25% of what a typical home fireplace made, he has previously told local media. He submitted that even additional modelling using end-of-life tyres (since removed from the proposed plant mix) showed BPMNZ would be able to meet the stringent discharge to air regulations for air emissions under the National Environmental Standards on Air Quality.

Air quality expert Andrew Curtis, brought in by HRC, says in his view there is minimal potential for off-site odour nuisance to occur as long as the odour control and mitigation measures were implemented and appropriate maintenance and monitoring carried out.

Further evidence from air quality expert Lou Wickham for Te Pae Hauora O Ruahine O Tararua/Midcentral (formerly Midcentral District Health Board), says in practice pyrolysis requires state-of-the-art abatement technology to ensure it has no adverse effects from air discharges.

She says if the proposal complies with recommended emissions limits, then it should have no adverse affects. But there was a sting in the tail.

“The poor information in the application and the erroneous claims regarding inter alia renewable energy and greenhouse gases do not provide confidence that this will be the case,” Wickham says.

In his hearing submission on behalf of BPMNZ,  Mathew Gribben of Buddle Findlay says if it would assist the Commissioners, the air quality experts and planners could engage in a focused sessions of expert “caucusing” or “hot tubbing” before the panel to identify areas of agreement and disagreement in relation to the technical conditions for consent.

Shoeshine thinks the ball remains in BPMNZ’s court, however, to front up with more information. 

Fiona Rotherham is a senior journalist with NBR.

Source link

Leave a Reply

Your email address will not be published.