ELLSWORTH — The signing of a purchase contract that would reopen the shuttered waste-to-biofuel plant in Hampden has been further delayed. Prospective buyer Delta Thermo Energy Inc. (DTE) has not secured the investment funds needed to purchase the facility, the Municipal Review Committee (MRC) said on Aug. 5. Delays in closing the sale have regularly occurred since the MRC named DTE as its preferred buyer in January.
The MRC speaks for 115 municipalities whose waste it manages. The committee thought it had found a buyer in Pennsylvania-based DTE. Instead, the review board finds itself in a holding pattern.
“We have been reassured [DTE] is doing everything to get this deal done,” MRC Executive Director Michael Carroll said. But he also noted that no term sheet – a nonbinding document outlining the terms and conditions between a potential borrower and lender – has been finalized or presented to the bondholder trustees or to MRC.
“We’re still waiting to see if sufficient finances can be secured and obtained to move that process forward,” Carroll said.
MRC did receive notification from one potential financier, he noted, that it is working with DTE and has enough funds to purchase the plant. But without a term sheet, MRC cannot know for sure.
“DTE does believe they can overcome these hurdles and financing can be secured,” he added. “They just need time.”
The MRC holds two roles in the negotiations, as the landlord leasing the land the facility sits on, and as customer, supplying the facility with solid waste.
A memorandum of understanding for the purchase was signed on March 31, and MRC was then hopeful of a June 30 closing. The MOU is now being extended on a weekly basis.
And while still hopeful of a successful sale to DTE, the MRC is also looking at “alternative contingencies,” MRC attorney Jon Pottle said, as “part of prudent, property planning.”
The Hampden waste facility has a short but troubled history. It was opened in mid-2019 by Coastal Resources of Maine LLC (CRM), which built and owned the plant, after MRC split with Penobscot Energy Recovery Co. (PERC) in 2018 in favor of the new plant and the cutting-edge Fiberight technology it planned to use. MRC had bought the land for the facility and leased it to CRM. But the plant closed in May 2020, less than a year after becoming fully operational, when CRM could not secure the additional financing it needed to continue. The facility was then placed in a court-ordered receivership while the MRC sought a new buyer to open and operate the $90 million plant. Since then, MRC-member trash has either been sent to a landfill or to PERC.
MRC Board President Karen Fussell said the board will hold a town meeting with DTE owner Robert Van Naarden in four to six weeks, with “hopefully positive news on the status of the financing.”