Infrastrata PLC Project Update (5827Y)
May 09 2019 - 11:56AM
UK Regulatory
TIDMINFA
RNS Number : 5827Y
Infrastrata PLC
09 May 2019
9 May 2019
InfraStrata plc
("InfraStrata" or the "Company")
Project Update
InfraStrata plc (AIM: INFA), the UK quoted company focused on
the development of natural gas storage capacity, is pleased to
provide an update on recent progress with the Company's Islandmagee
gas storage project (the "Project").
The Company is at an advanced stage in negotiations with the
final two potential offtake partners and the board of InfraStrata
believes these negotiations will reach a conclusion in the near
future. It may be that InfraStrata is able to secure an offtake
deal for all seven caverns (phase 1 &2) rather than just the
two caverns originally planned for in phase 1. If this is the case,
FID (final investment decision) for phase 2 (five caverns) may be
advanced by approximately 12 months from Q4 2020 to Q4 2019, with
the knock-on effect of this that FID for phase 1 is delayed by six
months to end 2019 due to phases 1 and 2 being addressed together.
However, overall this would represent a six month improvement on
phase 2 FID and bring the benefits of a larger project than phase 1
alone. However, this is still only another indicative scenario and
the final terms and timing of any offtake agreement cannot be
guaranteed at this stage. Once an offtake agreement has been signed
the Company will be able to provide details of the final agreement
and an update on dates for FID.
If the scenario materialises where further up front work is
required to undertake FID on all 7 caverns (phase 1 & 2), a
convertible loan facility may be provided by a potential equity
partner to seek to ensure that the first gas date is not effected
and the Project is further de-risked.
In relation to the draft marine license, InfraStrata has now
provided the relevant authorities with the final draft reports
requested and following feedback received, the Company is currently
in the process of updating these reports and will re-submit them to
the relevant authorities shortly. As previously mentioned, the
Company sees no reason that a full marine license will not be
issued for the Project in due course.
The Company has now submitted the final EU application for the
FEED study that was completed last year and the sum of EUR1.6
million is expected to be received in the next 8 weeks from the EU.
In addition, the Company is looking to submit applications for
additional grants for circa EUR8 million in relation to FEED
studies for the reverse flow of the existing Scottish Northern
Ireland Pipeline (SNIP) (in conjunction with Mutual Energy) and
twinning of that pipeline.
InfraStrata continues advancing its studies for future project
development opportunities on the potential FSRU (floating storage
regasification unit) opportunity and additional caverns, moving
from the concept development stage to a feasibility study in the
near future. In addition, as previously advised, we continue to
evaluate other potential energy related infrastructure projects,
one of which is other potential salt storage opportunities in the
UK.
All land purchases and easements have been completed apart from
purchasing plots 1 and 1.1, which were delayed after a request from
the land owner to provide a further extension. The cost of these
lots is agreed and they are due to complete by the end of June.
John Wood, Chief Executive Officer, commented: "As we reach the
final stage of our offtake negotiations an additional scenario has
arisen that may see FID taken for phases 1 and 2 at the same point
in time, which may affect our previously advised FID date of H1
2019 for phase 1 (2 caverns). We are extremely pleased with the
rate of progress of all the negotiations that are ongoing and are
confident of reaching a conclusion on our offtake negotiations in
the near future, which will in turn drive the other workstreams in
the Project ".
For further information, please contact:
InfraStrata plc c/o Yellow Jersey
John Wood, Chief Executive +44 (0)20 3735
8825
Allenby Capital Limited (AIM Nominated
Adviser & Joint Broker) +44 (0)20 3328
Jeremy Porter / Liz Kirchner 5656
SI Capital Limited (Joint Broker) +44 (0) 20 3871
Nick Emerson 4038
Yellow Jersey +44 (0)20 3735
Tim Thompson 8825
-ENDS-
Notes to editors:
InfraStrata is an independent gas storage company focused on the
UK and Ireland. Further information is available on the Company's
website: www.infrastrataplc.com
Background on the Islandmagee Storage Project
The Islandmagee gas storage project is a proposed salt cavern
gas storage facility located on Islandmagee in County Antrim,
Northern Ireland. The Board of InfraStrata believes that the
proposed 500 million cubic metres natural gas cavern storage
facility will provide over 25% of the UK's natural gas storage once
constructed. The facility will be situated adjacent to the Scotland
Northern Ireland (gas) Pipeline (SNIP) and the Moyle 500 megawatt
electricity interconnector. Work commenced in 2007 with the
acquisition of 3D seismic data to image the Permian salt in the
Larne Lough area. During 2012, planning permission was granted for
the project and a gas storage licence was issued by the Utility
Regulator. In 2015 a well was drilled to core the salt and confirm
the technical feasibility of the project, supported in part by the
European Commission. The Front End Engineering and Design (FEED)
element of the project was completed in November 2018 and the FEED
report was submitted to the European Union in December 2018 in
accordance with the Company's grant conditions. To date
approximately GBP14.5m has been invested in the project.
Further information is available on the company's website:
www.infrastrataplc.com
The Front End Engineering & Design (FEED) and Insitu
Downhole Testing programme for the Islandmagee gas storage project
is co-financed by the European Union's Connecting Europe
Facility.
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author. The European Union is not responsible for any use that may
be made of the information contained therein."
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END
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