EQTEC PLC (EQT.L) Acquisition and recommissioning of Italy plant

Acquisition and recommissioning of Italy waste-to-energy plant powered by EQTEC technology

EQTEC plc (AIM: EQT), a world-leading gasification technology solutions company for sustainable waste-to-energy projects , is pleased to announce the acquisition and planned to recommission of a 1MWe waste-to-energy plant in Italy. Originally commissioned in 2015, the plant is built around EQTEC’s proprietary and patented Advanced Gasification Technology.

The Company has acquired, and will lead a consortium to repower, own and operate, the biomass-to- energy plant (the “Plant”) in Castiglione d’Orcia, Tuscany, Italy. Once operational, it is intended that the plant will transform straw and forestry wood waste from local farms and forests into green electricity and heat for use in the local community.

The Plant is the first of two such facilities with EQTEC’s technology that have been decommissioned by previous owner-operators in recent years and that the Company has targeted for repowering to full operation. The Company intends for the Plant to become the first of its ‘Market Development Centres (“MDCs”), which will showcase its technology in a fully operational, commercial setting. The Company will make further announcements about the planned acquisition of a facility in Croatia in due course.

Highlights:

· EQTEC will lead a consortium joined by three other partners: an Irish Family Office, an Italian Family Office and MetalNRG plc (“Metal NRG”), (together the “Parties”), which will participate in a Special Purpose Vehicle (“SPV”), designated EQTEC Italia MDCSrl, investing an aggregate € 2.1m for an initial 80% equity interest;

· The Parties have signed a Heads of Terms Investment Agreement, (the “Agreement”) for the funding of the SPV, with financial close due imminently, subject to execution of the final form agreement by the Parties;

· The Company will hold the remaining 20% equity in the SPV. The Company estimates that the Plant will generate an unlevered IRR of 20% and annual EBITDA in excess of €750,000;

· The acquisition of the Plant has been completed by EQTEC;

· The Plant is due to be fully recommissioned and operational by Q2 2022. Connection to Italy’s national grid is already in place and the Project will benefit from the country’s favourable tariffs for electricity produced from waste biomass until the end of 2027;

· The Plant is expected to produce approximately 1MW green electricity from one tonne of straw pellets and wood chips annually and will be upgraded to process a greater diversity of biomass feedstocks over time. The contract value of EQTEC’s technology sales for the Plant is expected to be €1,750,000 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 for the Plant following its recommissioning. The O&M contract value for the Company is expected to be approximately €215,000 per annum; and

· The EPC contractor for the Project will be COS.M.I. Srl (“COSMI”), EQTEC’s Italian delivery partner and a company with successful experience in building EQTEC plants.

David Palumbo, CEO of EQTEC, commented:

“I am very pleased that EQTEC will lead the effort with our partners to re-commission and revive this biomass-to-energy plant in Italy, providing power and heat to the area and demonstrating sustainable, commercial success with EQTEC advanced gasification. Additionally, I am delighted to see us secure this with a well-balanced consortium of experienced partners and this is an approach we hope can be achieved for other projects in our pipeline.

“Finally, I am pleased about the local nature of this plant and our future role there as co-owner/operators. EQTEC is committed to ensuring our projects have a positive local impact, from sourcing, treating and converting local waste through to the generation of clean energy in the local area, all powered by EQTEC technology. We will continue to support local businesses, employing local people and sustainably delivering value for local communities in all the markets we operate .”

Further information about the consortium

As announced in March 2021, the Company can now provide an update on its Framework Partnership Agreement (FPA) with MetalNRG, which is in place to develop biomass-to-energy, RDF-to-energy and sustainable, clean energy projects in the UK and Europe. T o support and finalise its involvement in the consortium and subsequent SPV for the Project in Italy, as set out in the Company’s Trading Update on 22 March 2021, the intended share swap between EQTEC and MetalNRG is now being completed. MetalNRG will receive 27,932,961 new ordinary shares in the Company (“Ordinary Shares”) based on the market closing price of 1.79p per Ordinary Share on Friday 7 May 2021, while EQTEC will receive 60,606,061 MNRG shares at 0.0083p which was the market closing price on the same day.

Admission and total voting rights

The Company will make an application to the London Stock Exchange plc for the 27,932,961 new Ordinary Shares, issued and allotted set out above, to be admitted to trading on the London Stock Exchange’s Main Market for listed securities (“Admission”). It is expected that Admission will become effective and dealings will commence on or around 21 May 2021. The 27,932,961 New Ordinary Shares will rank pari passu with the existing Ordinary Shares.

Following Admission, there will be 7,235,845,151 Ordinary Shares in issue. This number may be used by shareholders as the denominator for the calculation by which they will determine if they are required to notify their interest in, or a change in their interest in, the share capital of the Company.

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.

About EQTEC plc

As the world’s leading experts in gasification for sustainable waste-to-energy projects, EQTEC is building the future of the sector, combining its technology innovation and engineering with expert plant construction and project deliveries, to help drive the global energy transition. EQTEC’s proven, proprietary and patented technology is at the centre of projects that aim to enhance local communities and champion local businesses with an improved environmental impact.

EQTEC designs and supplies advanced gasification solutions that have a higher efficiency product offering and are modular and scalable from 1MW to 30MW. EQTEC’s versatile solutions are independently proven to process over 50 different types of feedstock, including municipal waste, agricultural waste, biomass and plastics with no hazardous waste or toxic emissions . EQTEC’s solutions produce a uniquely pure high-quality synthesis gas (syngas), that is capable of being used for the widest applications in the creation of energy, hydrogen and biofuels.

EQTEC’s proprietary technology design together with deployment and maintenance capabilities mitigate the risks when using third party equipment. EQTEC’s Technology Integration capabilities enable the Group to lead collaborative ecosystems that build sustainable waste reduction and green energy infrastructure.

The Company is quoted on AIM (ticker: EQT) and the London Stock Exchange awarded EQTEC the Green Economy Mark that recognises listed companies with 50% or more of revenues from environmental/green solutions.

Further information on the Company can be found at www.eqtec.com.

Existing EQTEC plants and sustainable waste-to-energy market opportunities

To date, four commercial plants have been built and are using EQTEC’s advanced gasification technology. The oldest such plant, built in 2011, has operated for over 125,000 independently audited engine hours, receiving highly commendable feedback from leading gas engine company Jenbacher relating to purity of the syngas, reliability and efficiency.

EQTEC’s technology and solutions have, in the Board’s view, the potential to become a new UK and global standard for many traditional waste-to-energy facilities to collaborate with, reducing reliance on increasingly less attractive waste elimination methods and delivering new resilient and locally based clean energy infrastructure across the UK and internationally.


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