GENEX COMPLETES ACQUISITION OF 50MW JEMALONG SOLAR PROJECT & COMMENCES REFINANCING OF 50MW KIDSTON STAGE 1 SOLAR PROJECT
ASX Announcement 12 March 2019
Genex Power Limited (ASX: GNX) (Genex or Company) is pleased to announce that it has completed the acquisition of the 50MW Jemalong Solar Project (JSP), located near Forbes in the central west region of NSW (the acquisition). In addition, Genex is pleased to provide an update on its financing activities for JSP which are being conducted in conjunction with the refinancing of its 50MW Kidston Stage 1 Solar Project (KS1).
Completion of JSP Acquisition
Genex is pleased to advise that the vendor of JSP has satisfied all conditions precedent to the transaction, and the acquisition is therefore now complete. The Project is complementary to Genex’s existing solar and hydro power projects in North Queensland and reflects the Company’s aim to become a diversified renewable energy and storage operator in Australia.
The critical elements of JSP are now in place. These include GPS approval from the Australian Energy Market Operator (AEMO) and a firm Offer to Connect from the network service provider, Essential Energy. Genex now aims to rapidly complete the development and financing of the project with a view to start construction in the middle of 2019.
Refinancing of KS1 in conjunction with JSP
Project financing for JSP is currently underway with a number of banks indicating strong interest to provide construction finance for the project. These activities will coincide with refinancing of KS1 which reached practical completion in November 2018 and is now operating under a 20-year Queensland Government support deed. NAB is the financial advisor on the financing of JSP and concurrent refinancing of KS1.
The Company anticipates completing the KS1 refinancing and achieving financial close on JSP in the middle of 2019. Construction of JSP is expected to occur over a 12-month period, resulting in first generation in 2020.
Commenting on the announcement, CEO of Genex Power, James Harding stated:
“Genex is pleased to complete the acquisition of the Jemalong Solar Project, which it believes is an attractive opportunity for the Company to broaden and diversify its generation portfolio. We believe the addition of JSP provides an excellent opportunity to diversify Genex’s generation profile geographically whilst achieving exposure to the strong electricity spot market in NSW.
Genex will now seek to complete the outstanding works required to achieve financial close over the coming months, with the intention of commencing construction in the middle of the year. The accelerated development timeline and the short construction period will allow Genex to achieve a step-up in revenue earnings whilst the construction of the Kidston Stage 2 projects proceeds.
The Kidston Stage 2 projects remain the key priority for the Company, and development continues to progress as anticipated. The combination of the Kidston projects and the Jemalong project will position the Company as one of the Australian market leaders in renewables and energy storage.”
Figure 1. Genex large-scale solar project (KS1).
GENEX SIGNS TERM SHEET WITH ENERGYAUSTRALIA FOR LONG-TERM HYDRO ENERGY AGREEMENT AND EQUITY INVESTMENT
ASX Announcement 20 December 2018
Genex Power Limited (ASX: GNX) (Genex or Company) is pleased to announce that it has entered into a non-binding term sheet (Term Sheet) with EnergyAustralia Pty Ltd (EnergyAustralia) in respect of a long-term energy storage services agreement and equity investment in the Company’s 250MW Kidston Pumped Storage Hydro Project (K2-Hydro or Project). Genex is also pleased to provide an update on the progress of the Kidston Stage 2 projects.
Term Sheet with EnergyAustralia
Pursuant to the provisions of the Term Sheet, EnergyAustralia has conditionally agreed to negotiate, finalise and execute a long-term energy storage services agreement with Genex for the full dispatch and market rights attaching to K2-Hydro. In addition, the Term Sheet provides for a proposed equity investment by EnergyAustralia into a newly created Special Purpose Vehicle (SPV) which will be incorporated to construct, own and operate the K2-Hydro project.
The Term Sheet is non-binding and is subject to satisfactory completion of due diligence, with the long form agreements to be subject to a number of conditions precedent including final debt facility documentation, financial arrangements and agreements for grid connection, long form energy storage agreement and equity documentation, EnergyAustralia Board Approval and Genex Board Approval.
Genex has entered into a period of exclusivity with EnergyAustralia during which EnergyAustralia will complete its detailed due diligence and the two parties will seek to finalise the long form energy storage services agreement and equity arrangements on the basis of the terms agreed in the Term Sheet. In the event of a takeover offer for Genex being announced during the exclusivity period, EnergyAustralia may, under certain circumstances, be entitled to extend the exclusivity period for a further period and payment of a break fee.
Update on the Kidston Stage 2 projects
In addition to today’s key announcement, Genex wishes to provide an update on the Kidston Stage 2 projects, comprising K2-Hydro and the co-located solar farm of up to 270MW (K2-Solar).
Given the strong endorsement for K2-Hydro provided by EnergyAustralia, Genex is now seeking to move to financial close for K2-Hydro in H1 2019, with the development and financial close of K2- Solar to occur following the project financing of K2-Hydro.
The Board believes that its strategic decision to stage the development of K2-Solar will allow both K2-Hydro and K2-Solar to commence generation simultaneously in 2022, given the shorter development and construction timeline associated with K2-Solar. This will allow for an optimised timeline for construction of the new 275kV transmission line from Mt. Fox to Kidston and will reduce complexity for the overall project financing structure. The development and financing of K2- Solar remains a 2019 priority for the Company.
Figure 1. Kidston Renewable Energy Hub.
50MW KIDSTON SOLAR PROJECT REACHES PRACTICAL COMPLETION
ASX Announcement 3 December 2018
Genex Power Limited (ASX: GNX) (Genex or Company) is pleased to announce that its 50MW Kidston Solar Project (KS1 or Project) has successfully reached Practical Completion (PC).
PC marks the final milestone of the construction and commissioning stages of the Project. Following energisation in late 2017, the Project has undergone detailed commissioning processes that have allowed for the gradual ramp-up to full capacity. Engineering, Procurement and Construction (EPC) contractor UGL has successfully passed all the commissioning and performance tests required for PC to be granted.
The Project will continue to be operated and maintained by UGL under the terms of an Operation and Maintenance (O&M) Agreement for an initial 5-year period, with an option for Genex to extend for an additional 5 years.
Commenting on the final milestone, Chief Executive Officer of Genex, James Harding stated:
“We are very pleased to have successfully reached Practical Completion for KS1. This marks the completion of the Project construction and commissioning phase, and is the culmination of a successful cooperation between Genex, UGL, Ergon Energy and the Australian Energy Market Operator. We wish to thank UGL for their professionalism and efforts to finalise the Project and complete the outstanding EPC components, and we look forward to continuing our collaboration during the O&M phase.”
