Delorean clears funding hurdle for $62.1m Horsley Park bioenergy build

$62.1 Million Horsley Park Project Reaches Financial Close

Delorean Corporation Ltd (ASX:DEL) has cleared the funding hurdle that stood between its NSW1 Horsley Park bioenergy facility and construction. The company says Financial Close has been reached on the $62.1 million project, allowing procurement to start immediately and construction to move towards an early 2027 commencement.

“NSW1 Horsley Park render”

The milestone activates two major government grants worth $30.5 million: $20 million from the NSW Government’s Net Zero Manufacturing Initiative and $10.5 million from ARENA’s National Industrial Transformation Program. It also brings into force the project’s long-term agreements with Brickworks subsidiaries, including a 25-year lease and a renewable gas supply agreement under which Brickworks will take the project’s output, subject to agreed maximum quantities.

Westpac Facility Converts Financing Mandate Into Project Debt

Horsley Park Bioenergy has executed a $20 million Westpac trade finance facility to fund equipment costs. The facility carries a line fee equal to 1% of the limit and interest at BBSY plus 2.5%, with Westpac taking senior security over the NSW1 project company. Delorean intends to refinance the trade facility into longer-term project debt once the plant is commissioned. The executed agreement replaces the earlier Westpac financing mandate, which had been non-binding.

The funding table also includes up to $10 million under a new Tanarra Facility D, alongside $1.6 million already spent on project capital costs, research and development tax refunds and future Delorean cash. Tanarra’s term sheet is described as binding, but full legal documentation remains outstanding. Its proposed economics include cash interest of BBSY plus 8%, 5% capitalising interest, a 3.25% commitment fee on undrawn tranches and staged equity options over the NSW1 project company if the facility is drawn.

Discounted Placement Adds Equity Ahead of Construction

Delorean has received firm commitments for a private placement of 20,895,523 shares at 6.7 cents each, raising $1.4 million before costs. The issue price represents a 15% discount to the 4 November closing price and a 22% discount to the 15-day VWAP. The new shares are expected to be allotted and begin trading on 17 November, with proceeds earmarked for NSW1, working capital and offer costs.

There is a small but notable discrepancy in the announcement: the placement is described as raising $1.4 million, while the project funding table allocates $1.3 million to the equity component. The remaining $8.7 million of the stated project funding is grouped together from Tanarra Facility D, R&D tax refunds and future cash on hand, making the timing and availability of those sources important to the build schedule.

Brickworks Offtake Anchors Renewable Gas Facility

NSW1 is designed to process 120,000 tonnes of source-separated organic waste each year, with approval for up to 150,000 tonnes, and produce approximately 253,000 gigajoules of mains-grade biomethane. The gas will be piped behind the meter to Brickworks’ Horsley Park manufacturing operations. Delorean says the project is expected to reduce the plant’s natural gas use by around 50% and Scope 1 emissions by approximately 38%.

The next test is execution rather than approval. Delorean Engineering is due to begin procurement and mobilise to site, while the company must complete Tanarra’s legal documentation and manage the staged drawdown of project funding. The facility’s economics will ultimately depend on construction progress, commissioning and the planned transition from Westpac trade finance to longer-term project debt.