Sea 2 Sky Poised to Operate Using Torrefied Wood as Coal Substitute

Newcomer Sea 2 Sky Corporation is ready to take its renewable bio-energy business into operating mode using the torrefaction process as the basis to convert wood and wood fiber biomass into a low-emission, high-energy alternative to coal.

It's found dependable sources; now it needs to ally with users.

Torrefaction is a thermo-chemical treatment that incinerates biomass in the 200 to 340 Celsius range. During torrefaction the biomass partly decomposes but the remaining solid biomass -- in the Sea 2 Sky case torrefied wood pellets -- has about 30 percent more energy content per unit of mass, weighs less, is more easily transportable, and is virtually pollution-free.

Basically and probably unscientifically speaking, torrefaction is photosynthesis on steroids.

Torrefaction “is a scientifically proven method for improving the properties of biomass as a fuel,” says Sea 2 Sky, based in Ferndale, WA. The solid product produced, which the company calls “torrefied pellets,” retains about 70 percent of its initial weight and 90 percent of the original energy content, but without the harmful emissions of coal.

Sea 2 Sky (OTC:SSKY) plans to apply the technology to increase the energy output in biomass products and to provide a “coal-like product with significant environmental advantages,” it says.

Earlier this summer the company entered into a 15-year $757 million wood fiber supply agreement with Des Wilson Forestry Ltd. of New Zealand. It will provide Sea 2 Sky with 250,000 tons of wood fiber over the first two years, increasing to 500,000 tons a year for the remainder of the agreement.

Sea 2 Sky says the agreement enables the company to serve the international wood pellet market on a long-term basis, “with Europe and Asia having substantial multi-billion dollar product requirements.” The $757 million number is based on the current wood fiber market price of $233 per dry ton.

Wood pellets have many uses for industrial and residential use and are considered to be carbon-neutral when burned.

Sea 2 Sky says the German companies Novus Energy GmBH and RWE AG are “prime examples of companies substituting biomass for coal in Europe.” In addition, the largest coal burning company in the U.S., American Electric Power Inc. of Ohio (NYSE: AEP), is also switching some of its coal fired plants to co-fire with biomass.

With the Des Wilson agreement in place, “we have achieved a historic milestone of opening up new markets in the forest industry by harnessing strong international sources of supply in stable democratic states that we can now market,” said David Siebenga, company president and CEO.

With the supply question resolved, Sea 2 Sky is now “exploring and evaluating several alliances” with torrefaction-capable companies and potential users of torrefied wood pellets.

It has not identified those companies, saying only that “several business opportunities have been identified and proposals have been submitted with pending alliances in progress.”

In addition it plans to market torrified biomass to existing coal plants to be co-fired in pulverized coal boilers.