Foresta Faces Funding Pressure Despite Regulatory Wins at Kawerau
Foresta Group Holdings secures a critical extension from New Zealand's Overseas Investment Office and partners with EECA to explore geothermal energy use, pushing forward its flagship Kawerau biomass project.
- OIO grants extension for Kawerau project compliance
- Collaboration signed with EECA to assess geothermal steam feasibility
- Earthworks tender released and contract negotiations underway
- Final stages of forestry supply contracts and Māori partnerships
- Cash balance at AUD 1.2 million with ongoing capital raising efforts
Regulatory Extension Secures Project Momentum
Foresta Group Holdings has received a valuable extension from the New Zealand Overseas Investment Office (OIO) for its flagship integrated biomass manufacturing facility in Kawerau. This extension allows the company additional time to meet special conditions required under the Overseas Investment Act 2005, reflecting New Zealand’s stringent regulatory oversight of foreign investments. The approval is a strategic win, enabling Foresta to advance negotiations deliberately and align decisions with shareholder interests.
Innovating with Geothermal Energy
In a move underscoring its commitment to sustainability, Foresta has entered a collaboration agreement with the Energy Efficiency and Conservation Authority (EECA). The partnership aims to explore the feasibility of using local geothermal steam to supply process heat at the Kawerau plant. This study will evaluate operational needs, energy availability, and technology options, potentially positioning Foresta at the forefront of low-carbon manufacturing in the renewable pine chemicals and biomass pellet sector.
Progress on Construction and Community Partnerships
Foresta has progressed the Kawerau project’s earthworks phase by releasing a Request for Tender for bulk earthworks, with submissions due mid-July and contract negotiations ongoing. The project benefits from government support through a streamlined consenting program in the Bay of Plenty region, facilitating faster regulatory approvals. Concurrently, Foresta is finalizing key forestry supply contracts and strengthening relationships with local Māori iwi, recognizing their stewardship role and fostering partnerships that balance economic development with cultural and environmental preservation.
Financial Position and Funding Outlook
As of 30 June 2025, Foresta reported a cash balance of AUD 1.198 million, with net operating cash outflows of AUD 780,000 for the quarter. The company holds a $2 million convertible note facility, providing some financial flexibility. Foresta is actively negotiating insurance claim payments related to its Apple Tree Creek site and engaging with the New Zealand government and potential investors to secure further capital. These efforts are critical to sustaining operations and advancing project milestones.
Looking Ahead
Foresta’s recent regulatory and collaborative achievements mark important steps in its journey to become a global leader in renewable pine chemicals and biomass pellets. The outcomes of the geothermal feasibility study and the awarding of construction contracts will be pivotal in shaping the project’s trajectory. Meanwhile, ongoing capital raising and community partnerships will influence the company’s ability to maintain momentum and deliver on its strategic objectives.
Bottom Line?
Foresta’s Kawerau project gains regulatory breathing room and green energy momentum, but funding and execution remain key hurdles ahead.
Questions in the middle?
- What will the geothermal feasibility study reveal about cost and scalability?
- How soon will Foresta finalize earthworks contracts and commence construction?
- What are the prospects and timelines for Foresta’s planned capital raising?