Acquisition and planned recommissioning of waste-to-energy plant powered by EQTEC in Croatia
EQTEC plc (AIM: EQT), a world-leading gasification solutions company building a cleaner waste-to-energy industry , is pleased to announce the completed acquisition of a 1.2 MWe waste-to-energy gasification plant in Beliše, Croatia (the “Plant”), through Synergy Projects d.o.o. (“Synergy Projects”), a joint venture (the “JV”) between the Company and its Croatian project development partner Sense ESCO d.o.o. (“Sense ESCO”).
Originally commissioned in 2016, the Plant was built around EQTEC’s proprietary and patented Advanced Gasification Technology. The Plant will be recommissioned and repowered to convert forestry wood waste from local farms and forests into green electricity and heat for use in the local community.
Once operational, it is expected that EQTEC will become the Plant’s O&M contractor and that the Company will make it the second of its Market Development Centres (“MDCs”) and a showcase for EQTEC’s technology in a fully operational, commercial setting. The Company’s first MDC, in Tuscany, Italy, was announced earlier this year.
· The JV has signed a Share Purchase Agreement (the “Agreement”) for the acquisition and funding of the project Special Purpose Vehicle (“SPV”);
· Once the optimal financing structure is secured for the Plant, the Company will make further announcements and local EPC contractors will be vetted and chosen;
· Active discussions with investors are currently underway, toward financial close in the coming months;
· In the second half of 2021, a grid connection application will be made for the Plant in Beliše;
· The Plant is expected to be updated, recommissioned and repowered for operations towards the end of 2022;
· The Plant is expected to produce approximately 1.2 MW green electricity from c. 8,000 tonnes per year of locally-sourced wood chips and forestry waste biomass from regional forests;
· The Company estimates that the Plant will generate an unlevered IRR of 12% and annual EBITDA in excess of €850,000;
· The contract value of EQTEC’s technology sales for the Plant is expected to be €1,700,000 in technology and engineering upgrades;
· In addition to being co-owner, operator and Advanced Gasification Technology supplier to the Plant, EQTEC is to be contracted as the O&M contractor after commissioning;
· The JV acquisition of the SPV was funded by the Company via a €550,000 loan and a €1,650,000 10-year loan provided by a third party. Both loans are intended to be converted into privately placed bonds to meet local corporate requirements; and
· The JV currently is 100% owned by the Company, with 20% equity to be transferred to Sense ESCO after completion and an additional 20% subject to performance milestones.
David Palumbo, CEO of EQTEC, commented:
“EQTEC’s joint venture with such a capable and dependable partner as Sense ESCO provides the perfect platform for our re-entry into Croatia, re-introducing our Advanced Gasification Technology to sustainably transform biomass waste into energy for local communities. The plant in Beliše, which will also be a Market Development Centre, is the next of several EU waste-to-value facilities we are developing to integrate our leading-edge technology and overseeing through commissioning into live operations .”
This announcement contains inside information as defined in Article 7 of the EU Market Abuse Regulation No 596/2014 and has been announced in accordance with the Company’s obligations under Article 17 of that Regulation.
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