EQTEC PLC eyes hydrogen production facilities as Deeside project converted to joint venture
Discussions are underway with development and infrastructure investors for circa £10mln of project funding, as well as with potential owner-operators of the site
At least £10mln of third-party funding is sought to bring the project to financial close.
Varying the terms of the deal struck last December, which had been for EQTEC to acquire full ownership of the North Wales project, the company and Logik Developments have now agreed to act in partnership and seek to develop additional waste-to-value infrastructure.
EQTEC will now pay £3.3mln to acquire 32% of the share capital of the vehicle that owns the land and planning permissions for the project, Logik WTE Limited. This will be paid no later than 31 March 2022 from either existing cash resources or investment raised directly at project level.
It will also pay £0.5mln as a fee to Logik, which will be converted into further equity by the end of March, as part of the new joint venture agreement that removes the previous overage payments, deferred consideration and fixed dividend sum due to Logik.
Feasibility studies are already underway about production facilities of hydrogen and other biofuels to be added to the 6.27 hectare site, with a new agreement that 2.4 hectares will be set aside for the proposed hydrogen/biofuel project, alongside the currently approved 182,000-tonne waste reception plant, 2 MW anaerobic digestion facility and 9.9 MWe EQTEC Advanced Gasification Technology facility.
Discussions are ongoing with development and infrastructure investors for the circa-£10mln funding required for the construction of the project, as well as with potential owner-operators of the site, EQTEC said, with a number of parties said to be at the due diligence stage.
Following receipt of the funding, EQTEC will invoice £1.5mln for its project development services to the project vehicle, with the fee to be reduced on a pound for pound basis if the investment received is less than £10mln.
The company said it has also started talking to technology partners about the technical and commercial feasibility of applying EQTEC’s technology to produce a syngas to the specification required for hydrogen and other gas-to-liquids applications.
Chief executive David Palumbo said: “The Advanced Gasification and anaerobic digestion facilities will transform local municipal solid waste and commercial and industrial waste into green energy, powering local industry and communities.
“This new agreement with Logik has opened the possibility for further development of innovative infrastructure on the site and for demonstration of the wide range of applications achievable with our technology. As demand and government support for sustainable fuels and hydrogen increases, we will seek to establish more partnerships with technology partners who require a gasification solution which is able to provide syngas to specification.”
He said EQTEC forming strategic partnerships was a key element of the growth strategy.
Neil Spencer, managing director of Logik Developments, added: “Where Logik and MBS Partnership, our sister company, can focus on what we do best, land development and construction; and EQTEC can focus on designing solutions to deploy their world class technology. We already have our sights on other exciting projects to develop together.”
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