Business Operational Update and Board Changes

RNS Number : 2676S

Camco Clean Energy PLC

29 November 2012

 



29 November 2012

Camco Clean Energy plc

Business Operational Update and Board Changes

Camco Clean Energy plc (the "Company") today announces a business operational update and changes to its board of directors.

Project Development Update

The Company continues to focus on expanding its clean energy business in North America, Asia and Africa and its pipeline continues to build momentum in each area. Our technical expertise, project development experience and established local experts are the differentiating factor in accessing and evaluating such opportunities.

Project development highlights for 2012:

·    Our 4.5 MW clean energy biogas plant in Jerome, Idaho is now fully operational and is operating as anticipated, generating revenue from the sale of power to the grid. This plant continues to be a landmark asset for the Company and is generating significant new business activity in the US as well as the other areas where we focus.

·    Progress in the construction of Camco South East Asia's 2 MW biogas development project, which will recover biogas containing methane from palm oil mill effluent, is on track and is expected to be completed in early 2013.

·    Entering into a Joint Venture with MW1 for development of small scale solar PV projects in Africa.

·    Development of a strong pipeline of projects across China, SEA, Australia, USA and Africa.  The project pipeline builds off Camco Clean Energy's experience in Biogas, Solar and Energy Efficiency.

Update on impact of carbon (CER) price

At the time of the release of our interims, we noted that a fall in the CER price in the first half had resulted in a downwards carbon fair value adjustment to revenue of €2.1m and this trend had continued which, if sustained, would lead to a similar effect in the second half of the year. Since then, the CER price has continued to fall and therefore the Company is likely to record a further significant carbon fair value adjustment to revenue at the year end.

As anticipated, the company has successfully submitted for registration the majority of its carbon projects and is on track to meet its targeted registrations by the end of the year, being the latest date when such projects are eligible for registration. These projects will deliver credits from 2013 to 2020. In accordance with our accounting policies, upon registration and the projects becoming CDC operational, on a risked basis we record revenue from these projects. This revenue will also be impacted by the CER price at the end of the year which, together with the carbon fair value adjustment, will have a corresponding negative impact on the group's overall result.

As the Company moves toward building sustainable income streams from developing and owning clean energy assets, the Company continues to be reliant in the short term on carbon to fund its operating expenses and engages in spot and structured forward sales of credits, which has the effect of converting income into cash at that point.  At current CER prices, it is not economic or commercially sensible to make such forward sales and therefore the Company is taking action to reduce its cash outflow and best conserve its cash resources. Such action involves focusing on a reduction in central overheads and costs relating to the carbon business with the aim of delivering a material reduction in operating expenses. Notwithstanding such reduction, the Company still anticipates being able to deliver value from its carbon portfolio in the event the CER price recovers.

Board Changes

The Company also announces that Paolo Pietrogrande and Herta von Stiegel have both agreed to step down from the board in order to focus on other interests and allow for a more stream lined and lower cost operation. Paolo will step down with immediate effect and Herta from 31 December 2012.

Scott McGregor said:

"While European Carbon prices are at a historical low it is sensible for us to look at our cost base in the short to medium term to cover the impact of these lower prices. However, we will retain our key capabilities to delivery services to our partners and commercialise value when carbon prices recover.

The company is resourced and structured to now focus on clean energy project development. Momentum continues to build in this sector for us and is starting to produce significant results.  We look forward to accelerating development in clean energy projects and new carbon markets.

I would like to take this opportunity to thank Paolo and Herta for their advice and help and wish them well for the future."

Enquiries:

Camco Clean Energy plc	[phone]
www.camcocleanenergy.com
Scott McGregor, Chief Executive Officer
Jonathan Marren, Chief Financial Officer
N+1 Singer (Nominated Adviser and Broker)	[phone]
James Maxwell
Kreab Gavin Anderson (Investor Relations)	[phone]
Ken Cronin
Citigate Dewe Rogerson (PR Advisor)	[phone]
Chris Gardner / Malcolm Robertson

Notes to the editor

About Camco Clean Energy

Camco Clean Energy plc  (AIM: CCE) is an experienced project developer working to develop, construct and operate projects that contribute to building a sustainable future.

With more than 20 years of successful project delivery we help clients in Asia, North America, Africa and Europe to implement clean energy and emission reduction solutions, reducing costs and maximising financial and environmental benefits. We have an outstanding track record in technical delivery and commercial expertise, working with local industry, multinational companies, governments and regulatory bodies.

Camco Clean Energy has created one of the largest emission reductions portfolios and has structured ground breaking and innovative arrangements for the sale and delivery of emission reductions to compliance and voluntary buyers.

 

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