Thursday, 14th April 2016: Arrabawn Group, one of Ireland’s leading dairy and animal feed co-ops, has signed a gas supply deal with Naturgy Energy. Valued at over €2 million per annum, the agreement will see Naturgy supply Arrabawn with natural gas to meet the year-round energy requirements for its dairy ingredients manufacturing facility in Nenagh, Co. Tipperary.
Arrabawn operates across three divisions covering Dairies, Dairy Ingredients and Agribusiness. The Group has a proud heritage within Ireland’s co-operative movement spanning over 100 years, having been established in 2001 following the merger of Nenagh Co-op and Mid West Farmers Co-op. It continues to go from strength to strength as one of the county’s most efficient processors in a highly competitive market – having achieved its highest ever volume of milk supplies last year at 355 million litres.
The energy deal follows Nenagh’s connection to the national gas network and will see Naturgy provide Arrabawn with direct access to wholesale market prices for natural gas, allowing the Group to purchase gas at the best price available in the market – thereby resulting in significant savings in energy costs. As part of a fully managed service, Naturgy will also provide Arrabawn with risk management tools and a bespoke reporting solution to track the energy performance at its Nenagh facility in real time.
Mícheál O’Kelly, Financial Controller: “Our partnership with Naturgy is a critical component of our ongoing cost efficiency strategy and will enable us to significantly reduce operating costs by shifting to natural gas as our main fuel source. It comes at an exciting time for our business on foot of our recent completion of a €15.7m capital investment programme, which has allowed us to achieve substantial gains in efficiencies and a significant increase our competitiveness.”
“Not only does the deal provide our business with significant cost benefits through direct access to wholesale energy prices, but we are partnering with a company that has demonstrated a deep understanding and expertise of Ireland’s energy market.”
Stephen Behan, energy specialist at Naturgy said: “As our partnership with Arrabawn shows, cost competitiveness is a key requirement for businesses as they look to better manage their energy supply. For larger energy users in particular, we’re seeing a move toward more sophisticated procurement solutions that combine innovations in risk management with hands on market analysis to minimise energy costs.”