Coro Energy Plc (LON:CORO) has reached a binding agreement to take control of a newly-formed joint venture in Vietnam through which it will co-own a portfolio of commercial and industrial (C&I) rooftop solar projects in Vietnam alongside Vinh Phuc Energy JSC (VPE).
Coro Energy said on Tuesday that it will take over 85% of the new entity, Coro Renewables Vietnam, in exchange for providing initial funding of USD 500,000 (EUR 436,909) to de-risk a 5-MW pilot rooftop project, expected to be ready to build in 2022.
VPE will acquire the remaining 15% carried interest in Coro Renewables by transferring its existing 150-MW portfolio of projects to the joint company and offer management services, as it was originally proposed in July.
As part of the deal, the UK-based and southeast Asia-focused company will have the right to fund the construction of the pilot project estimated to amount to USD 3.5 million, with a view to securing near-term cash flows. In addition, Coro will have the option to fund the entire 150-MW project portfolio, possibly through project finance.
All planned rooftop systems have long-term "take or pay" power purchase agreements (PPAs) with unnamed creditworthy industrial customers that guarantee a pre-agreed level of revenue, according to the filing.
"I am delighted to announce the entry of binding agreements in connection with our Vietnamese rooftop solar project, which moves Coro closer to maiden revenues with the pilot project and a step forward on our strategic goal of being a major regional player in the renewables space," Coro CEO Mark Hood said.
Coro has clinched the agreement after getting an extension of the exclusivity period under the contract until end-October.
(USD 1 = EUR 0.874)
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