LONDON, UK: EQTEC plc has signed an agreement for the proposed acquisition of a 5MWe project in Drama, North Eastern Greece, through the recently established EQTEC Synergy Projects Limited, a joint venture between EQTEC and its Greek strategic partners, German EPC company, ewerGy GmbH.
Once acquired, the JV will lead the development of a new biomass-to-energy plant, generating 5MW green electricity from locally and sustainably sourced forestry waste. Due diligence, including financial and technical feasibility, has been completed.
Completion of the acquisition of the Project is subject to entering into of a Project Purchase Agreement, customary for this type of transaction.
- Synergy Aegean to acquire the biomass-to-energy Project in Drama, North Eastern Greece;
- The JV has signed a Preliminary Project Acquisition (the “Agreement”) for the acquisition of the Project via a Special Purpose Vehicle (“SPV”) to acquire the assets of the Project;
- The JV is in discussions with a number of local banks to provide the debt for the project funding at a Loan to Value (“LTV”) ranging between 70 and 80%;
- Active discussions with investors for the equity funding for the SPV are currently underway, toward Financial Close targeted for Q3 2022;
- The Plant, once operational, is expected to achieve the Company’s baseline target unlevered IRR of 12% and the JV team have identified commercial opportunities that if implemented, will further increase project returns;
- The acquisition involves all the associated assets of the Drama project including all rights and permits required for project development, build and operation as well as biomass feedstock agreements;
- The Plant, once operational, is expected to produce approximately 5MW of green electricity and up to 8MW of thermal output which is critical for the region, from c. 35,000 tonnes of locally sourced forestry waste;
- The Project is considered of public interest due to its location in one of the coldest regions in Greece: Nevrokopi, where temperatures have reached minus 30oC and there is no established infrastructure of heating networks. The Project will also bring local employment in this region of particularly high unemployment;
- The Plant has all licenses, building permits, grid connection and a power purchase agreement (“PPA”) already in place;
The project EPC will be ewerGy and once the optimal financing structure is secured for the Plant, the Company will make further announcements.
David Palumbo, CEO of EQTEC, commented: “I am very pleased that our Joint Venture in Greece is gaining further momentum with the intended acquisition of this project in Drama, after last month signing an agreement securing two agriculture waste-to-energy projects in Livadia. All of our projects in our Greek pipeline, now totalling five and with strong potential for more, will help local farmers and forestry managers to use the waste they produce in a way that supports a circular economy and is beneficial for the environment and local communities.
This will be considered a project of public interest as it addresses two critical local requirements: heating and employment. Through this Project, we are continuing to extend the reach of and apply our Advanced Gasification Technology in the EU, demonstrating strong demand in this market for the more sustainable approach to waste-to-energy that EQTEC can deliver.”
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13 Oct, 8:38 am GMT+1 ·Disclaimer