US land-based salmon farming company AquaBounty Technologies Inc has paused construction of its new farm in Pioneer, Ohio due to a substantial increase in its estimated cost of completion.
In a statement, AquaBounty said it will now take the required time to evaluate the timing and cost of size and scope alternatives, including a phased approach to complete the project.
It was expected that the farm would produce 10,000 tonnes of fish, with the first harvest in mid-2026.
CEO Sylvia Wulf explained that the company has been working with its design and construction partners over the past three years to manage and mitigate the increasing costs that were exacerbated by historic inflation levels to complete construction of the farm.
As cost estimates provided by the initial design/construction firm continued to increase, AquaBounty engaged a second construction firm in January this year to review the current cost estimates and to rebid the remaining construction elements in order to finalise the project’s guaranteed maximum price (GMP), which was integral to completing its municipal bond financing, she said.
“Despite the value engineering and cost reduction efforts we undertook, the GMP estimate that we received came in at a price that is significantly above our previously disclosed estimate of $375-395 million. Given this information, we cannot finance the project through a municipal bond placement without a significant increase in the company’s equity contribution. As a result, the company has put an immediate pause on further construction of the site while the management team undertakes a detailed review of its strategic options, including evaluating a smaller scope or size for the farm.”
Wulf said AquaBounty has been working closely with the village of Pioneer on the water and wastewater lines for the Ohio farm and the village has approved the creation of a public utility, which will own and operate the water and wastewater lines required for the farm’s operation.
AquaBounty is currently waiting for the issuance of the Right of Way (ROW) permit from Williams County.
“As we have said from the beginning, we are excited about what our project can contribute to the village and the county, and we are committed to being good neighbours and supporting the local community. We appreciate the support and collaboration from the State of Ohio, Williams County Economic Development Corporation and the Village of Pioneer,” she said.
“We believe in this project and its importance to the company’s growth strategy. Our focus now is on bringing it to completion in a manner that is prudent for the company and our shareholders. In the meantime, we intend to continue to supply our customer base with salmon from our Indiana farm, while using that facility to improve our operational practices and to test new technologies in preparation for the Ohio farm start up.
“Progress also continues at our PEI farms to expand the production of non-transgenic eggs and fry and on our R&D work focused on improvements in our broodstock and the improvements in the overall health and well-being of our fish. I look forward to providing further updates on our review process over the coming months as we strive to create sustainable value for our shareholders,” Wulf said.
AquaBounty’s land-based recirculating aquaculture system (RAS) farms in Indiana, United States and Prince Edward Island, Canada, are close to key consumption markets.
