TIDMALR
RNS Number : 7665C
Alternative Energy Limited
22 April 2013
22 April 2013
ALTERNATIVE ENERGY LIMITED
("Alternative Energy", "AEL" or the "Company")
Contract with P.T. Mega Urip Pesona
The board of directors ("Board") of the Company refers to the
announcement of 4 October 2012 ("4 October Announcement"), pursuant
to which the Shareholders of the Company were apprised of certain
key discussions undertaken by the Company then which would have a
significant impact on the business, financial position and
operations of the Company, including without limitation:
(i) the execution of a binding Heads of Agreement dated 22 June
2012 ("Heads of Agreement") with P.T. Mega Urip Pesona ("MUP");
(ii) the execution of the supplemental heads of agreement dated
22 June 2012 ("Supplemental Heads of Agreement") with MUP; and
(iii) the memorandum of understanding dated 22 June 2012 entered
into between the Company and P.T MUP Alternatif Energi, being a
subsidiary of MUP.
The Board is pleased to announce that the Company has, in
furtherance of the above, entered into the master project agreement
("Master Project Agreement") with MUP on 12 April 2013 for which
final schedules were made available to the Company on 16 April
2013, which sets out the concrete terms and conditions in respect
of the collaboration between MUP and the Company with regards to
the "Proyek 1000 Pulau" ("1000 Islands Project"). In particular,
pursuant to the Master Project Agreement, the Company has been
appointed as the exclusive Employers Engineering, Procurement and
Construction contractor ("Employers EPC Contractor") for the 1000
Island Project, which involves the establishment of solar energy
generating facilities across Indonesia.
Commenting on the transaction, the Executive Chairman of the
Company, Mr. Christopher Nightingale said: "We believe that the
execution of the Master Project Agreement by the Company and MUP
will enable the Company to capitalise on its previous research and
expertise to participate in the launch of the next generation
renewable energy projects across Indonesia. We are thrilled by the
prospects that await us"
The key commercial terms of the Master Project Agreement are as
follows:
(A) Agreed Projects
Further to the 4 October Announcement, the salient aspects of
the projects under the 1000 Island Project have been finalised. The
Company will undertake the following projects under the 1000 Island
Project, which shall include but not limited to the following:
(i) China Projects. Any and all projects deriving from the
Memorandum of Understanding dated 26 March 2012 signed between MUP
and LDK Solar Hi Tech at the Beijing China/Indonesia Presidential
Summit held on 23 March 2012, or from the estimated US$600,000,000
soft loan which is anticipated from the government of the People's
Republic of China to MUP in respect of Indonesian solar projects
(as previously announced in the 4 October Announcement).
(ii) Funded Projects. Any and all projects deriving from
financing or loans arranged or introduced by the Company or through
its agents to MUP, PT Perusahaan Listrik Negara ("PLN") or any
other party in respect of solar projects in Indonesia.
(iii) World Bank Projects. Any and all solar projects in
Indonesia funded by the World Bank to which MUP is a party; and
(iv) IPP Projects. Such other projects, whether being public
private partnerships of otherwise, as MUP and AEL shall agree from
time to time to be part of the Master Project Agreement ("IPP
Projects"). The initial schedule of IPP Projects annexed to the
Master Project Agreement consists of one (1) 10-50 megawatts solar
power plant project in Bali, Indonesia and nine (9) 10 megawatts
solar power plant projects in other parts of Indonesia;
(each an "Agreed Project" and collectively, "Agreed
Projects").
In Agreed Projects where MUP may not itself be the project
owner, the Master Project Agreement provides that MUP will procure
the appointment of the Company as the employers engineer by the
relevant project owner on the same terms as the Master Project
Agreement, as if MUP had been the project owner. In Projects where
MUP or its subsidiary is the project owner, MUP will be deemed to
have appointed the Company directly under the terms of the Master
Project Agreement.
(B) Scope of Work
It was previously announced in the 4 October Announcement that
the Company was to be appointed as the exclusive Engineering,
Procurement and Construction ("EPC") contractor for the all
projects to which MUP is a party under the 1000 Island Project and
that the Company would utilise its systems expertise to design the
systems and act as the principal EPC contractor.
The Company wishes to update the shareholders that under the
Master Project Agreement, the Company will be appointed as the
exclusive Employers EPC Contractorof the Agreed Projects, providing
on site management and supervision until its completion.
In particular, in respect of each of the Agreed Projects, the
Company shall provide the following services:
(i) site survey and preliminary feasibility study to determine,
inter alia, suitability for solar power generation, potential cost
and energy yield, as well as potential specifications of technical
requirements necessary for successful project initiations
("Pre-Feasibility Study");
(ii) project financing assistance such as assisting in
discussions and negotiations with bankers or potential project
financiers, providing technical analysis required to assist bankers
or financiers in providing funding, as well as introducing bankers
or financiers who are interested in providing financing to MUP;
(iii) contractor selection including inter alia the selection
and appointment of a turnkey or main contractor for any particular
Agreed Project, selection or nomination of sub-contractors or
suppliers, advising MUP on technical merits or issues arising from
any potential contractors or their proposals, preparing and
evaluating tender or project specifications and proposals made to
or received from potential contractors or suppliers, as well as
assisting in drafting or contract documentation between MUP, the
project owner (if it is not MUP) and any contractor or
supplier;
(iv) project supervision of the Agreed Projects to supervise the
carrying out of the work by the appointed contractors and suppliers
in accordance with the respective contracts and contract
specifications, including inter alia reporting to MUP on the
execution of the Agreed Projects, notifying MUP or the project
owner (if it is not MUP) of any issue, defect or default and
recommending actions in respect of any issue, defect or
default;
(v) reviewing all work carried out by the appointed contractors
and suppliers, confirming when the Agreed Project is substantially
completed, making recommendations in respect of any further work or
review which should be carried out by the appointed contractors or
suppliers, and providing any certificates required by bankers or
financiers in respect of the work carried out; and
(vi) making recommendations to MUP or the project owner (if it
is not MUP) for the monitoring and maintenance of the Agreed
Project following its completion and for its useful life as well as
reviewing any arrangements proposed for the monitoring and
maintenance of the Agreed Project. In the event that the Company
itself provides any monitoring or maintenance services, these shall
be the subject of a separate contract.
(C) FIDIC Terms
In addition to the key commercial terms expressly set out in the
Master Project Agreement, the Master Project Agreement incorporates
standard and internationally acceptable engineering terms as
prescribed by the International Federation of Consulting Engineers
or Fédération Internationale Des Ingénieurs-Conseils ("FIDIC"). In
particular, the FIDIC short form of contract general conditions
(1(st) edition) and FIDIC conditions of contract for EPC/turnkey
projects (1(st) edition) shall apply to all Agreed Projects, in
relation to the Company providing its services under the Master
Project Agreement.
(D) Consideration for Services
In consideration of the services provided by the Company under
the Master Project Agreement, MUP agrees to pay (or procure the
payment by the relevant project owner of the relevant Agreed
Project) to the Company a sum in respect of each Agreed Project
calculated by reference to the number of megawatts of power
involved in each Agreed Project ("Consideration").
In cases where the internal rate of return on the Agreed
Project's equity net of fees payable to the Company ("Equity IRR")
is more than 18% per annum, the Consideration payable to the
Company shall be US$0.18 per watt. In cases where the Equity IRR is
less than 18% per annum, the Consideration payable to the Company
shall decrease accordingly, provided that such amount shall not be
less than US$0.05 per watt.
Payments will be made by MUP to the Company progressively over
the lives of each Agreed Project, according to the following
payment schedule:
(i) 10% upon the carrying out of the Pre-Feasibility Study;
(ii) 80% in equal monthly payments between the date of the
appointment of the main contractor in respect of the relevant
Agreed Project, or if there is no main contractor the date of the
first appointment of a contractor or supplier for the relevant
Agreed Project, and the date upon which the Agreed Project is due
to be completed in accordance with such main contract or contract
(as the case may be); and
(iii) the remaining 10% following practical completion of the
relevant Agreed Project in accordance with the main contract or
principal contract (as the case may be).
(E) Financing Fee
In cases where the Company is responsible for the introduction
of financing, either by way of equity, loan or otherwise, for
projects in respect of which MUP or PLN is the project owner, the
Company shall be entitled to an additional fee ("Financing Fee")
for arranging such financing. The Financing Fee shall be an amount
of 2% of the financing so raised through the Company. The Company
shall nominate parties introduced by it and shall do so in writing
prior to any financing arrangements being finalised.
(F) Grant of Share Option
The Company had in the 4 October Announcement announced that
under the Supplemental Heads of Agreement, upon the execution of
the Supplemental Heads of Agreement, the Company had agreed to
grant to MUP an option to purchase new ordinary shares in the
Company ("AEL Shares") representing up to 29.9% of its entire
issued share capital at a price of US$0.005 per AEL Share, on a
fully diluted basis ("Share Option"). MUP may exercise the Share
Option in tranches of not less than US$100,000 at any time within
six (6) months from the execution of the Master Project Agreement.
In the event MUP (i) holds more than 20% of the issued share
capital of the Company, MUP is entitled to nominate one (1)
director to the Board of the Company; and (ii) holds more than 28%
of the issued share capital of the Company, MUP is entitled to
nominate two (2) directors to the Board of the Company, such
nominations subject always to regulatory approvals.
The Company wishes to announce and update the Shareholders that
under the Master Project Agreement, the terms of the Share Option
will be set out in a separate agreement to be signed by the Company
and MUP.
(G) AEL as Nominated Supplier and Sub-Contractor
As previously announced in the 4 October Announcement, MUP will
exclusively use the Company's technologies, where relevant, in the
creation of green energy based sustainable communities across
Indonesia ("e-Villages"). These e-Villages may or may not be
covered by the main or turnkey agreement in respect of an Agreed
Project. Pursuant to the Master Project Agreement, the details of
the agreement between the Company and MUP in relation to the
e-Villages are as follows:
(i) subject to Indonesian regulatory conditions, MUP will use
(or procure the use by the relevant project owner of) the Company
as the nominated supplier and sub-contractor in conjunction with
the community concept, roofing, energy systems and energy saving
devices (including lighting) in each of the Agreed Projects, and
the Company will supply its roofing and all other electrical
components, appliances and hardware, and the related installation,
engineering, procurement and construction related to green energy
technologies or other technologies developed or introduced by the
Company in each of the relevant Agreed Projects;
(ii) the Company will work in conjunction with MUP's (or the relevant project owner's) other sub-contractors in the creation of low cost, energy self-sufficient buildings, in particular with the housing contractor or construction companies identified by MUP (or the relevant project owner) as their sub-contractors in connection with building and construction. The buildings may also utilise the Company's eLive housing units components and materials and design, subject to agreement between the parties; and
(iii) the Company will appoint MUP as its sole and exclusive
agent in Indonesia in connection with all its technologies utilised
in the e-Village program, including any additional technology
developed during the carrying out of the e-Village program, and the
Company will grant to MUP licences to use all of its patents,
trademarks and other intellectual property used in the e-Village
program.
ENDS
About Alternative Energy
Alternative Energy Limited is headquartered in Singapore.
Through its team of Singapore based engineers, Alternative Energy
has developed a number of technologies including its patented roof
based energy system, the eRoof. The Company is now producing its
third generation eRoof for commercial roll out this year. The
Company is also developing a number of energy saving technologies
designed to reduce power consumption, led by its LED lighting
systems, which will combine with its energy generation systems to
enable the creation of energy self sufficient buildings.
'NOW THE WORLD HAS AN ALTERNATIVE' (TM)
For further information please see the Company's website:
www.alternativenergy.com.sg or please contact:
Richard Lascelles, Independent Non-executive Director Tel: 020
7408 1067
Roland Cornish and Emily Staples, Beaumont Cornish Limited Tel:
020 7628 3396
Eric Goh, Executive Director Tel: +65 68737782
This information is provided by RNS
The company news service from the London Stock Exchange
END
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