ID: 20461

04.09.19

Investment projects in Ukraine

Construction of a plant for the production of second-generation biodiesel and glycerin

Attracting investment in the construction of a station for the production of second-generation biodiesel with an annual production of 8.6 thousand tons and glycerin of 2.5 thousand tons in Central Ukraine

Location:

Украина, Черкассы

  • Sector: Нефтехимическая промышленность
  • Business activity: Производство кокса и продуктов нефтепереработки
  • Stage: Ранние стадии (Early Stage)
  • Required investments: $3 250 000
  • Type of investment: Участие в капитале
  • Share in capital: 60%
  • Return on investment: 4 г.
  • IRR: 40%
Construction of a plant for the production of second-generation biodiesel and glycerin

Construction of a plant for the production of second-generation biodiesel and glycerin

Attracting investment in the construction of a station for the production of second-generation biodiesel with an annual production of 8.6 thousand tons and glycerin of 2.5 thousand tons in Central ...

The project took into account the possibility of scaling in 3 phases with an increase in production volumes up to 25.7 thousand tons of biodiesel and 7.6 thousand tons of glycerin.

Current situation on this project:

  1. A well-developed business plan.
  2. Detailed financial model
  3. Land plot for the construction of the plant.
  4. Preliminary contracts for the supply of raw materials.
  5. Preliminary sales and distribution contracts.
  6. Own financing of the project available (up to 40%).

The originator of the project is a company that has experience in implementing renewable energy projects in biogas production.

Production is based on organic fats of animal origin, but other fats can also be used as raw materials. There are preliminary agreements (LOI) for the supply of raw materials from local manufacturers. There are also options for buying fat at MHP auctions.

End products: biodiesel and glycerin.

Location: Cherkasy, Ukraine.

Sales of manufactured products: internal and external (EU) markets. There are preliminary contracts for the sale of products to Europe.

Market:

  • In Europe there is a statutory increase of the rate of biodiesel impurities in diesel. The global trend of increasing diesel use leads to a similar increase in biodiesel use.
  • Worldwide, biodiesel production, starting in 2011, increased by 54.88% (from 24.6 million liters to 38.1 million liters).
  • There are no similar projects in Ukraine, so this is a “blue ocean strategy”; the absence of competitors in the Ukrainian market and the availability of raw materials guarantee a high level of project development.

Financing structure: up to 40% of the Project budget will be provided in the form of the originators' funds, the rest is attracted in the form of debt or equity from financial investors.

Key financial indicators:

  • The volume of investments is 4.8 million euros,
  • Construction period - up to 1 year,
  • Annual revenue - 7.1 million euros (86% - sales of biodiesel, 14% - sales of glycerin),
  • Annual EBITDA - 2.0 million euros,
  • Net present value (NPV) - 20 million euros (including all 3 phases of the project),
  • Payback period - 4 years,
  • Internal rate of return (IRR) - 40%.
  • Sector: Нефтехимическая промышленность
  • Business activity: Производство кокса и продуктов нефтепереработки
  • Stage: Ранние стадии (Early Stage)
  • Required investments: $3 250 000
  • Type of investment: Участие в капитале
  • Share in capital: 60%
  • Return on investment: 4 г.
  • IRR: 40%
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  • Sector: Нефтехимическая промышленность
  • Business activity: Производство кокса и продуктов нефтепереработки
  • Stage: Ранние стадии (Early Stage)
  • Required investments: $3 250 000
  • Type of investment: Участие в капитале
  • Share in capital: 60%
  • Return on investment: 4 г.
  • IRR: 40%
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