React Energy PLC Repowering of Newry Biomass Limited (6146K)
December 31 2015 - 7:15AM
UK Regulatory
TIDMREAC
RNS Number : 6146K
React Energy PLC
31 December 2015
31 December 2015
REACT Energy plc
("REACT" or the "Company")
Repowering of Newry Biomass Limited
REACT, the renewable energy developer and operator focusing on
the production of clean energy in the UK and Ireland, announces
that Newry Biomass Limited ("NBL"), a 50.01% subsidiary of the
Company, which owns a Biomass Gasification project located in
Newry, Northern Ireland, has entered into an agreement with Spanish
MAB-listed EBIOSS Energy AD ("EBIOSS") to purchase its EQTEC
Integrated Biomass Gasification Power Plant, with a power output of
4MW, which NBL will use in the repowering of the Newry Biomass
gasification project ("Newry Biomass"). The total cost of
repowering Newry Biomass, including the gasification power
equipment to be purchased from EBIOSS, is estimated to be
approximately GBP8 million.
Newry Biomass is a 4MW Biomass gasification project located in
Newry, Co. Down, Northern Ireland. The project is a joint venture
with Farmer Business Development plc ("Farmers"), the Company's
23.2% shareholder. NBL is a 50.01% subsidiary company of REACT.
Planning permission for the waste to energy plant converting 25,000
tonnes per annum of wood was received in May 2009. The project cost
GBP11.7 million to construct and was funded through shareholder
equity and loans. REACT invested GBP5.75 million and currently
retains 49.11% of the economic benefit of the project, whilst
Farmers has 50.89%.
Due to underperformance of the original gasification technology,
a decision was made to repower the project with a new technology
and with a new technology provider. Accordingly, the project was
placed on a 'care and maintenance' programme in September 2014,
pending additional funding required to engage a new technology
provider, which the Company has today chosen. NBL has already
exported electricity to the grid however the repowering of the
project includes the completion of upgrades, subject to available
funding, to the local electricity grid infrastructure which will
increase export capacity from the site from 1MW to 4MW.
The gasification equipment purchased from EBIOSS will cost
EUR4.963 million, fully payable in cash. It has been contractually
agreed between NBL and EBIOSS that the equipment purchased will
form part of an Engineer, Procure and Construct ("EPC") contract to
be signed between EQTEC Iberia, a subsidiary company of EBIOSS or a
company designated by EQTEC Iberia, and NBL. The equipment is
currently held in storage by NBL and will be on site in Q1 2016.
The credit terms obtained under the purchase and sale agreement of
the gasification equipment from EBIOSS provide for full payment by
NBL not later than 30 June 2016 and it is the intention of NBL to
reach a conclusion on raising all the financing for repowering
Newry Biomass (which, as noted above, requires a capital commitment
of approximately GBP8 million to be entered into by NBL) before the
end of Q1 2016. Once financial close on repowering the project is
achieved the Company expects that the plant will be able to again
export electricity to the grid within 15 months.
The Company looks forward to making further announcements in due
course.
For further information:
REACT Energy plc
Gerry Madden / Brendan
Halpin +353 (0)21 2409 056
--------------------------- --------------------
Strand Hanson Limited
- Nomad & Broker
James Harris / Richard
Tulloch / Ritchie Balmer +44 (0)20 7409 3494
--------------------------- --------------------
About REACT:
REACT Energy plc is committed to operating clean electricity and
heat generation plants in the UK and Ireland. The Company seeks to
identify, build, own and operate renewable projects and possesses
significant knowledge of energy markets, clean technologies, fuel
sources, project development, project finance and project delivery.
REACT currently has four operational clean energy plants generating
revenue from the sale of electricity and heat. The generation of
clean electricity and heat from sustainable sources has the
potential to address the key energy challenges of energy security
and carbon commitment and provide strong returns on capital
employed.
The Company is quoted on AIM and trades as REAC. Further
information on the Company can be found at
www.reactenergyplc.com.
About EBIOSS:
EBIOSS Energy, AD is an industrial engineering group and is
involved in the engineering, construction, project development and
operation of waste-to-synthesis gas plants. It operates at an
international level and owns a state of the art technology and
differential positioning in designing and construction of waste
gasification power plants with power capacity from 500 kW to 10 MW.
EBIOSS has developed its own technology, the EQTEC Gasifier
Technology (EGT) by which different types of waste are transformed
into synthesis gas. This leading technology on waste gasification
has made possible the design construction and/or operation of waste
gasification plants in Spain, France, Germany, India, Italy and
Bulgaria among other countries, for third party international
energy groups and for use by EBIOSS itself.
EBIOSS is quoted on MAB the alternative market of the Spanish
Stock Exchanges and trades as MAB:EBI. Further information on
EBIOSS can be found at www.ebioss.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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