Proposed Joint venture in Ireland

RNS Number : 2971S

Hydrogen Utopia International PLC

13 July 2022

 

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 13 July 2022

Hydrogen Utopia International PLC

 (the "Company" or "HUI")

Proposed Joint Venture with Powerhouse Energy Group PLC for a Waste Plastic to Hydrogen facility in Ireland

Hydrogen Utopia International PLC (AQSE:HUI), a company pioneering non-recyclable waste plastics to hydrogen technology, is pleased to announce that it has agreed heads of terms ("HoTs") with Powerhouse Energy Group PLC (AIM:PHE) for the joint development of a site at Lanespark in Co.Tipperary in the Midlands in Ireland  which it anticipates will lead to HUI's first operational full scale waste plastic to hydrogen facility in Europe (the "Lanespark Project").

HUI and PHE have agreed, subject to obtaining an acceptable title to the proposed site and relevant project documentation being completed, to establish a joint venture vehicle owned equally by each company with development costs being contributed to on a 50:50 basis (the "JV").

Under the HoTs, PHE has agreed to pay HUI a non-returnable payment of £400,000 in cash and advance to HUI a loan of £600,000, in recognition of HUI's contribution to the Lanespark Project through its technological approach to the waste plastics to hydrogen process, identifying the site and its potential and its negotiation of a deal with the current site owners. It is anticipated that the Lanespark Project will not only bring a site that can benefit from either local, national or EU grant funding or a combination of them, but which will also offer significant potential for local feedstock supply and offtake agreements with potential tier 1 customers.

The proposed waste plastic to hydrogen plant will be built on part of the site currently leased to Trifol Resources Limited ("TRL"). The site was referred to in HUI's announcement of its investment in TRL and the proposed plant in Ireland on 26 April 2022. PHE's participation in the Lanespark Project, the payment and the loan to HUI referred to above are conditional upon TRL and the freeholder agreeing to provide the JV an acceptable title to the site, which will enable the Lanespark Project to be financed (the "Title Condition"). HUI is in advanced discussions with the relevant parties to satisfy the Title Condition.  

The loan to be provided to HUI by PHE will be available for drawdown in whole or in part upon satisfaction of the Title Condition and the completion of project documentation which will include amongst other documents,  a development agreement and a shareholder agreement. The loan would have a term of up to two years, with redemption in full possible after one or two years through a bullet repayment of £660,000 or £750,000, respectively and, in each case, reflecting rolled up interest and capital. HUI would provide PHE with security for the loan through a charge over its shares in the JV.

In recognition of the fact that the proposed joint venture will supersede any pre-existing arrangements between HUI and PHE, the parties have agreed that the existing Exclusivity Agreement between PHE and HUI's UK operating subsidiary and the existing Collaboration Agreement between the same parties will each be mutually terminated without any further obligation on either party. In addition to their collaboration on the Lanespark Project, HUI and PHE will consider collaboration on future projects as and when beneficial, although neither party is obligated to do so.

Guy Peters, Executive Chairman of HUI, commented:

"This deal offers us the opportunity to jointly pioneer a European waste plastic to hydrogen plant in an area that offers plentiful feedstock supply and offtake potential in an attractive jurisdiction. Utilising the technological expertise and skills of both companies' teams and our wider network of suppliers and experts should enable us to deliver a plant that will act as a circular economy showcase to the world."

Aleksandra Binkowska, CEO of HUI, commented: "We are at a critical point in modern world history as a result of global forces beyond our control. The global pandemic and the invasion of Ukraine caused an economic and geopolitical crisis which changed the world as we knew it. That reinforces a need for strong alliances and partners who share our goals and vision. HUI joining forces with PHE for our project in Ireland is a natural and complementary alliance: together, sharing knowledge and resources, we can realise our vision more quickly and efficiently. United we stand, divided we take a lot longer."

For more information about the Company, please refer to our website: www.hydrogenutopia.eu

For further information please contact:

Hydrogen Utopia International PLC

Aleksandra Binkowska/Guy Peters 

[phone] 

Alfred Henry Corporate Finance Limited (AQSE Corporate Adviser)

Jon Isaacs 

[phone] 

Novum Securities Limited (Broker)                                                                 

Jon Belliss/Colin Rowbury     

[phone]

About Hydrogen Utopia International PLC

HUI aims to become one of the leading new European companies specialising in turning non-recyclable mixed waste plastic into carbon-free fuels, new materials or distributed renewable heat.

A HUI facility uses non-recyclable mixed waste plastic as feedstock and turns it into syngas from which new products and energy can be produced. HUI anticipates that its revenues will be derived from a variety of sources, dependent upon location and configuration of the HUI facilities, including the sale of syngas, hydrogen and other gases, electricity and heat sales, and the payment to it of fees for a given quantity of non-recyclable mixed waste plastic received at a HUI facility .

HUI will target areas where there is significant private sector interest or potential, financial backing is accessible and or where substantial EU and/or government funded sources of grants and loans are or may be available. The global increase in fossil fuel-based energy prices reinforces the need for alternative, price competitive energy sources, which HUI's business model can provide.

The pressing need to deal with growing amounts of waste plastic combined with a real momentum in the use of hydrogen from renewable sources may pave the way for a rapid deployment of and investment in HUI facilities.

 

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