Delorean Locks in $62M Bioenergy Project With $31M Government Backing Secured
Delorean Corporation (ASX: DEL) has reached a positive Final Investment Decision for the $62.1 million Delorean Horsley Park Bioenergy Facility, a 100%-owned project co-located with Brickworks’ operations in Horsley Park, New South Wales. The decision is conditional on securing the remaining $31.6 million in funding within 6 months, with the company having already locked in $30.5 million in combined government grants from ARENA and the NSW Government.
Delorean locks in Final Investment Decision for $62.1m NSW bioenergy project
The FID marks Delorean’s transition from developer to owner-operator of bioenergy infrastructure, with nearly 50% of construction costs covered by public funding. The NSW Government has committed $20 million through its Net Zero Manufacturing Initiative (NZMI) grants programme, administered by the NSW Department of Climate Change, Energy, the Environment and Water. The Australian Renewable Energy Agency (ARENA) has contributed a further $10.5 million under the National Industrial Transformation Programme.
The facility will be constructed on Brickworks-owned land under a 25-year lease agreement, with a rent-free period during construction. Development approval was secured in July 2025, positioning the project for construction commencement in Q3 CY2026, subject to financial close. Delorean estimates a 21-month construction timeline to commissioning, targeting first gas delivery by approximately Q2 CY2028.
Delorean proposes to fill the remaining $31.6 million capital requirement through a mixture of debt and new equity issuance. The company has engaged Coltbridge Capital to commence formal debt sourcing and has appointed Canaccord Genuity and Curran & Co to assess capital raising options.
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Project economics and revenue potential
The facility is designed to process 120,000 tonnes per annum of source-separated organic waste, with regulatory approval to process up to 150,000 tonnes annually. It is expected to produce approximately 253,000 GJ of renewable gas (biomethane) each year, supporting multiple revenue streams from Day 1 of operations.
| Metric | Value |
|---|---|
| Annual revenue (ex-CPI) | >$13 million |
| Processing capacity | 120,000 tonnes p.a. (approved up to 150,000) |
| Renewable gas output | ~253,000 GJ annually |
| Construction timeline | 21 months to commissioning |
| First gas expected | ~18 months from construction start (Q2 CY2028) |
Based on current estimates, over the minimum project life of 25 years, the facility is expected to generate in excess of $13 million of revenue per year without allowing for CPI adjustments. Revenue visibility is underpinned by contracted offtake arrangements and diversified income sources:
- Gate fees from organic waste processing
- Renewable natural gas sales
- Australian Carbon Credit Units (ACCUs)
- Potential: NSW Renewable Fuel Certificates
- Potential: Liquid fertiliser sales
The diversified revenue model reduces single-source dependency and provides cashflow certainty from operations commencement, with initial revenues from waste acceptance and first gas expected within approximately 18 months of construction start.
What is a bioenergy facility and why does it matter?
A bioenergy facility converts organic waste into renewable energy through a process called anaerobic digestion. In simple terms, organic materials such as food waste and agricultural by-products are broken down by microorganisms in an oxygen-free environment. This process produces biogas, which is then upgraded to biomethane, a renewable gas that is chemically identical to natural gas extracted from fossil fuel sources.
The Horsley Park facility will produce mains-grade biomethane that can be injected directly into existing gas infrastructure or used on-site without requiring modifications to industrial equipment. This provides manufacturers with a pathway to reduce Scope 1 emissions (direct emissions from owned or controlled sources) while maintaining energy reliability and operational continuity.
The dual benefit of waste diversion and renewable energy generation positions bioenergy infrastructure within the broader decarbonisation trend affecting Australian manufacturing. As industrial operators face increasing regulatory and market pressure to reduce emissions, biomethane offers a drop-in replacement for natural gas that requires no equipment overhauls or process changes, making it an attractive transition fuel for gas-reliant sectors.
Strategic partnership with Brickworks secures long-term offtake
Delorean and Brickworks have entered into binding agreements providing revenue certainty and de-risking the project’s commercial viability. The Lease Agreement grants Delorean access to Brickworks-owned land for 25 years, with a rent-free period during construction. The Gas Supply Agreement commits Brickworks to offtake all renewable gas produced over the lease term, up to agreed commercial-in-confidence maximum quantities.
The arrangement will cut natural gas usage in the co-located brick plant by around 50%, equating to a 38% reduction in Brickworks’ overall Scope 1 emissions at the Horsley Park site. Brickworks is also entitled to purchase Australian Carbon Credit Units (ACCUs) and Renewable Fuel Certificates generated by the project. Both agreements are conditional on Delorean achieving financial close within 6 months.
Mark Ellenor, Brickworks Building Products CEO
“Reliable and affordable gas remains critical to Australian manufacturing, and biomethane projects like this provide an important pathway to diversify energy supply and support industry. We welcome the support of the Federal and NSW Governments for this initiative. This project will reduce Brickworks’ Scope 1 emissions at the site by nearly 38% while also diverting significant volumes of organic waste away from landfill. The initiative will introduce low carbon bricks to the NSW housing market.”
Brickworks Building Products is a wholly owned subsidiary of Washington H. Soul Pattinson and Company Limited (ASX: SOL), providing additional counterparty strength to the contracted offtake arrangements.
Government backing and funding pathway to financial close
The project has secured two material government grants, validating its strategic importance to NSW and federal decarbonisation objectives. Both grants are conditional on Delorean sourcing the balance of construction funding within the stipulated timeframe.
- NSW NZMI Grant: $20 million for construction of the Horsley Park facility under the $480 million Net Zero Manufacturing Initiative.
- ARENA NIT Programme: $10.5 million for construction and initial operations under the National Industrial Transformation Programme.
Together, these grants provide a direct capital contribution of $30.5 million, reducing Delorean’s funding burden by approximately 49% of total project costs.
Delorean has commenced formal processes to secure the remaining $31.6 million through a proposed funding mix combining debt financing and new equity issuance. Coltbridge Capital has been engaged to lead debt sourcing activities, while Canaccord Genuity and Curran & Co are assessing different equity capital raising options for the company. Further information on these funding arrangements will be disclosed once terms are finalised.
The 6-month financial close window creates a near-term catalyst for the company, with construction commencement contingent on successfully closing the funding gap.
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What comes next for Delorean
The FID establishes a clear pathway to operational revenues, with several material de-risking milestones ahead. The critical path forward is defined by funding completion, construction execution, and commissioning activities leading to first gas delivery.
- Financial close target: Within 6 months
- Construction commencement: Q3 CY2026 (subject to financial close)
- Commissioning completion: Q2 CY2028 (21 months from construction start)
- First revenue from waste acceptance and first gas: ~18 months from construction start
Joe Oliver, Delorean Managing Director
“Delorean’s 100%-owned NSW1 facility co-located with Brickworks operations in Horsley Park is a transformational milestone for the Company and an industry changing milestone for Australia. With the significant grant support of ARENA and NSW Government, Delorean will now build critical organic waste processing infrastructure on Sydney’s doorstep, supporting Brickworks’ brick manufacturing for the New South Wales housing market for decades to come. The project sets the position clearly that Delorean’s build/own/operate facilities are the future path forward for Australia’s gas reliant industrial and manufacturing sector.”
Financial close represents the next material de-risking event, removing funding contingencies and enabling construction mobilisation. Once operational, the facility will establish Delorean as an owner-operator of bioenergy infrastructure with contracted revenue visibility over a 25-year minimum project life.
The Horsley Park FID positions Delorean within the structural growth opportunity created by Australia’s industrial decarbonisation requirements, with government grant support validating the commercial and strategic rationale for biomethane infrastructure co-located with gas-intensive manufacturing operations. Successful execution through to first revenues in 2028 will establish the build-own-operate model as a replicable template for future projects targeting Australia’s manufacturing sector.
Want to Know How Delorean Plans to Finance Its $62.1m Bioenergy Project?
With nearly 50% of construction costs already secured through ARENA and NSW Government grants, Delorean is now working to close the remaining $31.6 million funding gap within six months. The company has engaged debt and equity advisers to structure the final capital package ahead of Q3 CY2026 construction commencement.
To follow Delorean’s progress toward financial close and first gas delivery in Q2 CY2028, visit the Delorean investor centre for project updates, funding milestones, and ASX announcements. Track how this 100%-owned bioenergy facility transitions from FID to operational cashflows over its 25-year contracted life.