Establishment of Greek Joint Venture

RNS Number : 9317M

EQTEC PLC

24 September 2021

EQTEC plc

("EQTEC", the "Company" or the "Group")

Establishment of Greek Joint Venture and

agreement to acquire waste-to-energy project with exclusivity on additional project

EQTEC plc (AIM: EQT), a world-leading gasification solutions company building a cleaner waste-to-energy industry, is pleased to announce that it has established EQTEC Synergy Projects Limited ("Synergy"), a joint venture ("JV") between EQTEC and its Greek strategic partners, German EPC company, ewerGy GmbH ("ewerGy") (operating in Greece via its local partner, ECO Hellas M IKE). The JV has also signed an agreement for the proposed acquisition of a 1MWe waste-to-energy gasification project in Livadia, Greece (the "Project") and exclusivity for a second 1MWe project nearby.

The Company is the majority shareholder in the JV which will be capitalised by both partners. The main purpose of the entity is to source, qualify and develop projects by providing advisory and development services to projects in the region. The local partners, ewerGy and ECO Hellas will provide a Managing Director and local relationships to resource the generated pipeline and drive projects to financial close. Project SPVs will be established for each qualified project opportunity. The JV will be the majority shareholder of each Project SPV.

The formation of the JV in Greece follows a similar structure which the Company announced in July, in which EQTEC established Synergy Projects d.o.o. ("Synergy d.o.o."), a joint venture ("JV") between EQTEC and its Croatian project development partner Sense ESCO d.o.o. ("Sense ESCO"). The JV in Croatia has since completed the acquisition of two projects in Croatia, including a second EQTEC Market Development Centre through recommissioning of a 1.2 MWe plant in Belišće, which has existing EQTEC Advanced Gasification Technology inside, announced on 11 August, and the acquisition of a 1.2 MWe plant in Karlovac, announced on 14 September.

Completion of the acquisition of the Project is subject to entering into of a Project Purchase Agreement, customary for this type of transaction.

Highlights:

·	Synergy Projects Joint Venture to acquire the biomass-to-energy project, ("Star I") in Livadia, Boetia, Greece from the current owner;
·	The acquisition also includes exclusivity rights for Star II, a project with similar characteristics under the same terms of Star I and which is also located in Livadia and about which due diligence will subsequently be carried out;
·	The JV has signed a Preliminary Project Acquisition and Exclusivity Agreement (the "Agreement") for the acquisition of the Project via a Special Purpose Vehicle ("SPV") to acquire the assets of the Project;
·	The JV has received a Term Sheets from a number 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 in the coming months;
·	The Plant 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 Star I 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 1 MW green electricity from c.7,500 tonnes of mixed agricultural waste from local farmers;
·	The Plant has all licenses, building permits and a grid connection and a power purchase agreement ("PPA") is 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:

"We have long identified Greece and the Aegean region as one with a strong pipeline potential for EQTEC to bring advanced gasification capabilities to more local farming communities. With one project currently being constructed and a second in development in Greece already, today we are further delivering on that promise progressing the acquisition of Star I and the exclusivity rights for Star II. Both plants are further examples of how we can source and sustainably transform local agriculture waste into a decentralised source of energy supply to local communities."

ENQUIRIES

EQTEC plc	+44 203 883 7009
David Palumbo / Nauman Babar

Strand Hanson - Nomad & Financial Adviser	+44 20 7409 3494
James Harris / James Dance

Arden Partners - Joint Broker	+44 20 7614 5900
Paul Shackleton (Corporate) / Simon Johnson (Sales)

Canaccord Genuity - Joint Broker	+44 20 7523 8000
Henry Fitzgerald-O'Connor / James Asensio / Patrick Dolaghan

Alma PR - Financial Media & Investor Relations	+44 20 3405 0205
Josh Royston / Sam Modlin	[email protected]

BECG - General Media Enquiries	+44 7554 014 188 / +44 7867 452 269
Carrie Lowe / Tom Gosschalk	[email protected]

About EQTEC plc

As one of the world's most experienced gasification technology and engineering companies, with a growing track record of delivering operational and commercial success for transforming waste-to-energy through best-in-class technology innovation, engineering and project development, EQTEC brings together design innovation, project delivery discipline and solid commercial experience to add momentum to the global energy transition. EQTEC's proven, proprietary and patented technology is at the centre of clean energy projects, sourcing local waste, championing local businesses, creating local jobs and supporting the transition to localised, decentralised and resilient energy systems.

EQTEC designs, supplies and builds advanced gasification facilities in the UK, EU and US, with highly efficient equipment that is modular and scalable from 1MW to 30MW. EQTEC's versatile solutions process over 50 varieties of feedstock, including forestry wood waste, vegetation and other agricultural waste from farmers, industrial waste and sludge from factories and municipal waste, all with no hazardous or toxic emissions. EQTEC's solutions produce a pure, high-quality synthesis gas ("syngas") that can be used for the widest range of applications, including the generation of electricity and heat, production of synthetic natural gas (through methanation) or biofuels (through Fischer-Tropsch, gas-to-liquid processing) and reforming of hydrogen.

EQTEC's technology integration capabilities enable the Group to lead collaborative ecosystems of qualified partners and to build sustainable waste reduction and green energy infrastructure around the world.

The Company is quoted on AIM (ticker: EQT) and the London Stock Exchange has awarded EQTEC the Green Economy Mark, which 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.

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