Jackson Distillers — Project Danna

Invest in Scotland's newest and greenest grain distillery.

Jackson Distillers Limited (JDL) will build a new grain distillery in the Scottish Borders with the capacity to produce 20 million litres of pure alcohol (LPA). JDL be the only producer of single grain whisky spirit (GWS) in the region.

This will be Scotland’s first grain whisky distillery to be built in over 12 years, and by far the most environmentally friendly. Using the latest distilling technology and energy supplied from an adjacent anaerobic digestion gas plant, the distillery will offer a renewables-focused approach, with a plan to reach net zero carbon emissions and to become a net carbon absorber.

JDL will source its grain from local sources, reducing production costs and increasing value-adding provenance.

The investment will create a highly valuable, independent and immediately cash-generative asset. It'll offer an opportunity for a significant financial return to investors.

Investment of up to £50.5 million

To complete construction of the distillery

Using local sources will reduce CO2 emissions by 83 tonnes per year

Located in the Scottish Borders and will create 20 new green jobs

Filling a gap in a rising market

In the last decade, 29 malt whisky distilleries have opened in Scotland, with 36 more in the pipeline. But only one grain whisky distillery has opened in the last 25 years.

Seven grain distilleries were operational in 2021. Most of these were built over 50 years ago. They're often inefficient compared to modern facilities.

The majority of grain whisky producers use their supply to make their own blended whisky products. As the demand for malt whisky increases, grain whisky producers will use more of their supply internally.

William Grant & Sons and Diageo currently own 62% of the existing grain spirit capacity in Scotland. New independent distilleries are seeking independent supply for new whisky blends, as well as for gin and vodka. JDL's distillery will provide an alternative source of grain spirit, with strong provenance, for distillers seeking an independent supply.

By 2025, JDL’s first full year of production, the grain whisky industry is expected to be at 98% capacity. The opportunity for a new, independent grain distiller to meet rising demand is clear.

Once operational, the distillery will produce 5% of the total market volume of GWS. There is potential to expand the distillery to produce 40 million LPA in the future.

Green credentials and traceability

JDL’s core production operation will require 20% less energy than other grain distillers, mainly thanks to the use of state-of-the-art green energy technology, as well as local grain and energy sources. Further design optimisation has reduced energy inputs per litre of alcohol by 25%.

Carbon studies have shown that the distillery’s core operations (in terms of Scope 1, 2 and 3 impacts) will emit around 8000 tonnes of carbon per year.

The use of biomethane reduces this consumption by 6000 tonnes per year. The planned introduction of CO2 capture technology will further reduce consumption by 5000 tonnes per year. This leaves the distillery as a net absorber of 3000 tonnes of carbon per year.

JDL supports and endorses the Scotch Whisky Association environmental targets. It'll seek B-Corp Certification for its sustainable and accountable processes.

Market trends show that an ever-increasing number of people care about the provenance of what they eat and drink. To meet this need, JDL will record the exact field and farm their raw materials come from.

Investment opportunity

JDL is seeking £50.5 million to complete the construction of the distillery. The build and installation will be completed by an expert third party, via a fixed-price contract, to minimise risk.

Heads of Terms have been signed with the landlord, St Boswell’s Biogas Limited, for a 35-year lease, including an option to purchase the land on the ten-year anniversary. The distillery is located next to the biomethane plant.

The site has full detailed planning consent. It also has potential to double capacity to 40 million LPA.

Forecast growth

The distillery is forecast to generate Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA) of £628,000 in 2024, its first year of operation, rising to £11.1 million by 2029.

The management team is highly experienced in the whisky industry, having spent decades with Whyte & Mackay and North British Distillery (Diageo and Edrington JV). Team members have also led significant construction projects including St Boswell Biogas and Crabbie's Distillery.

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Disclaimer

Whereas every effort has been made to ensure that the information in these pages is accurate, Scottish Enterprise and Scottish Development International does not accept any liability for errors, omissions or misleading statements. And no warranty is given, or responsibility accepted as to the standing of any individual, firm, company or other organisation mentioned. Investors will need to undertake their own due diligence in conjunction with individual project promoters/sponsors in relation to the detailed project investment opportunities presented.