PyroGenesis (TSX: PYR) has found one of its major projects caught up in a creditor protection filing. $3.6 million in contracts appear to be on the line follow Varennes Cellulosic Ethanol LP, the owner of the Varennes Carbon Recycling project, filing for creditor protection earlier this month.
The filing, made on March 11, was made following liquidity challenges faced by Varennes. With the filing, Varennes has been permitted to continue operations while seeking restructuring under court supervision. PyroGenesis under this process has notably been labelled as a key supplier, enabling work to continue on the project, with timely payments scheduled to be made for that work.
Varennes, whom is building Canada’s largest biofuel production facility in Quebec, contracted Pyro Green-Gas, a subsidiary of PyroGenesis, in June 2024 for the engineering and fabrication of a thermal swing adsorption system for gas recovery at the plant. The $2.5 million contract was expected to see delivery completed in the fourth quarter of 2024.
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A $1.1 million follow-on contract related to a nitrogen loop system meanwhile was announced on February 3, roughly a month before the filing for creditor protection by Varennes, bringing the total value of the relationship to $3.6 million.
It is unclear how much PyroGenesis is presently owed under the contracts, or what the ongoing payment terms look like.
PyroGenesis last traded at $0.57 on the TSX.
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