TIDMEQT
RNS Number : 7019S
EQTEC PLC
18 July 2022
18 July 2022
EQTEC plc
("EQTEC", the "Company" or the "Group")
Selection of Petrofac for FEED on Billingham Project
EQTEC plc (AIM: EQT), a world-leading technology innovation
company enabling the Net Zero Future through advanced solutions for
hydrogen, biofuels, SNG and other energy production , is pleased to
announce that it has selected Petrofac as its front-end engineering
design ("FEED") contractor for its multi-technology,
waste-to-energy project at Haverton Hill, Billingham, Teesside, UK
(the "Project"). The Company and Petrofac (together, the "Parties")
have signed a Letter of Intent ("LoI") to formalise their joint
commitment to collaborate on the FEED and as potential EPC partner
for development and delivery of the Project.
The Project
The Project site is in a heavily industrialised area, adjacent
to major plant facilities and estates, including those of CF
Fertilisers UK Limited, Seqens Group pharmaceuticals and many
others. Through its wholly owned project SPV, Haverton WTV Limited
("Haverton"), the Company has secured all relevant permits and
permissions to build a refuse-derived fuel ("RDF")-to-combined heat
and power ("CHP") facility that would transform 200,000 tonnes per
year of RDF into up to 25MW of electricity for export to the
national grid, with the potential for creating up to 34MW of
thermal energy. The Company has secured the contract for a grid
connection and is also pursuing discussions with neighbouring
companies about provision of private wire offtake.
The Company in December 2021 confirmed it was investigating new
offtake opportunities for the Project and that it was working with
partners toward feasibility work at both sites. As the RDF-to-CHP
plant would utilise less than 40% of the total land to be acquired
by Haverton, the Company earlier this year pursued additional work
to consider how best to leverage the remaining land and increase
the value of the Project as a result. Following full review of
multiple financial models for the Project, technical feasibilities
and updated site drawings, the Company and its partners are now
considering a range of additional facilities including for hydrogen
production, battery storage and/or hydrogen refuelling. All such
options would be subject to further planning permission and
agreement of future owners of the Project, which the Company
intends to sell in whole or in part.
The primary focus of the Company now is collaboration with
neighbouring industrial companies, partners and potential
investors, toward finalisation of development options and of
project finance that will enable progress toward financial close
and deployment of EQTEC technology with others in a
multi-technology facility. To enable the funding optionality and
flexibility brought by the multi-technology approach, the Company
also intends to apportion Haverton into multiple, special-purpose
vehicles (the "SPVs").
FEED partner and potential EPC
The Company has been working with Petrofac since 2021, during
which the Parties collaborated on pre-FEED work including a
thorough review by Petrofac of EQTEC's technology. The Parties'
collaboration culminated in a formal and robust proposal by
Petrofac for provision of the FEED for the RDF-to-CHP facility. On
the basis of this and Petrofac's experience as both an Engineering
Services provider and EPC contractor, EQTEC have selected Petrofac
to be the nominated FEED contractor for the project.
In the interest of pursuing project finance for the Project, the
Parties have not set a formal start date for the FEED, so that
prospective investors may be included in consideration of the
various site designs. Petrofac has agreed to support the Company's
efforts with engagement of funding candidates, in the interest of
sharing its views on the delivery strategy, including procurement
and integration risks and how it would mitigate them. Although the
Company will appoint Petrofac for the FEED work, selection of the
EPC partner would require approval of the SPVs' owners at the time
of appointment. The Company believes Petrofac would be the leading
candidate for the EPC work.
Letter of intent
To formalise its collaboration with Petrofac on the Project, the
Parties have signed a LoI which specifies they will:
-- Exclusively pursue FEED and appointment of Petrofac as EPC
(subject to partner approval) for one or more SPVs of the Project;
-- Jointly present the Project and its investment case to potential
funders, with EQTEC leading on presentation of the overall
financial case, investment opportunities and core technology
and with Petrofac leading on presentation of the perceived
risks to successful delivery of the Project and the mitigations
it proposes;
-- Seek to agree a formal FEED contract or other formal, commercial
agreement between the SPV and Petrofac;
-- Continue joint qualification of further collaboration opportunities
beyond the Project; and
-- Continue joint consideration of a broader, collaboration agreement
for joint business planning, target identification and pursuit
and co-development of projects that apply EQTEC technology.
Jeff Vander Linden, COO of EQTEC, commented:
"Petrofac has for decades been a leader in delivery of
large-scale, complex projects in the oil & gas industry and now
are one of the global EPCs moving most quickly to bring that
expertise to new energy businesses. Our engagement with Petrofac
over the past year or so has been interactive and focused, with a
dedicated, joint team and open collaboration toward finalisation of
the FEED proposal and heads of terms that will support work start
and steady progress at Billingham. As our largest and most complex
project, Billingham represents a wide range of opportunities for
innovative application of EQTEC technology in concert with other
technologies; but it also requires a different approach to assemble
investment. By applying flexible funding options and strong
partners, I believe we will advance the Billingham project
steadily, toward bringing EQTEC syngas-based solutions to Teesside
and to the wide range of industrial businesses that will benefit
from them."
Jon Carpenter, Vice President New Energy Services at Petrofac
commented:
"We look forward to supporting the engineering of EQTEC's
Billingham project and to working with their team to de-risk the
project leveraging our construction experience of complex process
plants to ensure the design is efficiently constructable and
operatable. We are excited by the potential of the waste-to-value
sector in the UK and are excited to be working with pioneers such
as EQTEC in turning this potential into reality and delivering the
energy transition in the process."
ENQUIRIES
EQTEC plc +44 203 883 7009
David Palumbo / Nauman Babar
---------------------------
Strand Hanson - Nomad & Financial Adviser +44 20 7409 3494
---------------------------
James Harris / Richard Johnson
---------------------------
Arden Partners - Joint Broker +44 20 7614 5900
---------------------------
Ruari McGirr (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 EQTEC@almapr.co.uk
---------------------------
+44 (0) 20 7457 2381 / +44
Instinctif - General Media Enquiries (0) 7887 884794
---------------------------
Chris Speight / Tim Field EQTEC@instinctif.com
---------------------------
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
.
About Petrofac
Petrofac is a leading international service provider to the
energy industry, with a diverse client portfolio including many of
the world's leading energy companies.
Petrofac designs, builds, manages and maintains oil, gas,
refining, petrochemicals and renewable energy infrastructure. Our
purpose is to enable our clients to meet the world's evolving
energy needs.
Petrofac's core markets are in the Middle East and North Africa
(MENA) region and the UK, where it has built a long and successful
track record of safe, reliable and innovative execution,
underpinned by a cost effective and local delivery model with a
strong focus on in-country value. Petrofac operates in several
other significant markets, including India, South East Asia and the
United States. It has 8,200 employees based across 31 offices
globally.
Petrofac is quoted on the London Stock Exchange (symbol:
PFC).
For additional information, please refer to the Petrofac website
at www.petrofac.com
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