Limoneira (LMNR) said Tuesday it entered into a letter of intent to form a joint venture with organics waste recycler Agromin to expand their existing organic waste recycling program.

The 50%-50% joint venture intends to expand from the current 15-acre green waste composting facility at Limoneira Ranch in Santa Paula, California, into a 70-acre commercial-scale composting facility that can process green waste and food waste, Limoneira said.

The expansion project is expected to start construction in fiscal year 2025 and be completed in phases in 2026, the company said.

Limoneira said that upon completion, the expanded facility is anticipated to generate first-year earnings before interest, taxes, depreciation and amortization contribution of about $5 million that it will share equally with Agromin.

Annual EBITDA contribution is projected to rise to $9 million over the next 10 years, retaining the same equal profit-sharing scheme, Limoneira said.

The company also said it is planning to lease the 70-acre site to the joint venture for about $600,000 each year to strengthen its rental operations business unit.