JSE-listed renewable energy company Kibo Energy has signed heads of terms with Aim-listed gasification solutions company EQTEC to acquire a 54.54% interest in the proposed 25 MW Billingham waste gasification and power plant at Haverton Hill, in Teesside, in the UK.
It is expected that Kibo will acquire a 54.54% equity stake in the project special-purpose vehicle (SPV).
EQTEC will retain a 45.46% equity stake in the project SPV.
The project is at advanced stages of development with a concept design for the full plant produced, planning permission approved, grid connection offer secured and technical due diligence with technology insurance providers completed.
The project is expected to process 200 000 metric tonnes a year of nonrecyclable everyday municipal solid waste into 25 MW of green electricity.
Kibo’s initial funding contribution will be £3-million paid as an equity subscription, plus convertible shareholder loan facilities in accordance with the agreement.
Kibo will have the option to provide additional convertible shareholder loan facilities to the project SPV and/or convert future project development fees into further equity in the project.
Project rights, held by the SPV, include all technology licence agreements, all equipment supply and maintenance agreements with EQTEC and all rights to the site under the existing agreements with Scott Bros.
Following completion of the transaction, EQTEC and Kibo will invoice for their respective project development services to the SPV.
EQTEC will remain the lead development manager on the project, providing the design and core advanced gasification technology and subsequently retaining the maintenance portion of the operations and maintenance contract upon commissioning.
Kibo is also pursuing waste-to-energy development in South Africa. In May, it partnered with Industrial Green Energy Solutions to jointly develop a portfolio of such projects in the country.