Irish gasification technology and engineering company EQTEC [LSE:EQT] said it has completed the acquisition of a 1.2 MWe waste-to-energy gasification plant in Karlovac, in Croatia, for an aggregate consideration of 1.2 million euro ($1.4 million), through Synergy Projects, a joint venture with its Croatian project development partner Sense ESCO.
The acquisition of the plant by the joint venture was funded by the company via an 1.2 million euro loan that is intended to be converted into privately placed bonds to meet local corporate requirements, EQTEC said in a statement on its website released late on Tuesday.
The joint venture currently is 100% owned by EQTEC, with 20% equity to be transferred to Sense ESCO in the near term and an additional 20% subject to performance milestones.
“This acquisition is in line with the company's strategy to recover decommissioned gasification plants employing other technologies, in order to further establish it as the dominant and reliable technology partner by increasing the number of operating plants employing EQTEC Advanced Gasification Technology in the near term,” it added.
The deal follows the acquisition of a 1.2 MWe waste-to-energy plant in Belisce, in eastern Croatia, announced in August.
The plant in Karlovac was not able to achieve the designed operational availability and had to be closed. EQTEC said it is expected to be updated, recommissioned and repowered for operations towards the end of 2022.
The company estimates that the plant will generate an unlevered IRR of 12% and annual EBITDA in excess of 700,000 euro. Active discussions with investors are currently underway, toward financial close in the coming months, the statement added.
The contract sales value to EQTEC for the plant is expected to be some 4.5 million euro in technology and engineering. The contract is expected to be paid in instalments, starting at financial close and continuing throughout the construction and commissioning period, which is anticipated to be 12 months.
The plant is expected to produce approximately 1.2 MW green electricity from some 7,500 tonnes of locally sourced wood chips and forestry waste biomass per year from regional forests.
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