Vietnamese Solar Acquisition

RNS Number : 4518S

Coro Energy PLC

16 November 2021

 

16 November 2021

Coro Energy Plc

("Coro" or the "Company")

Vietnamese Solar Acquisition

Coro Energy Plc, the South East Asian energy company supporting the regional transition to a low carbon economy, is pleased to announce the entry of binding joint venture agreements in respect of the Vietnamese solar acquisition by the Company originally announced on 12 July 2021.

Highlights

· Low cost entry for Coro into the fast growing Vietnamese energy sector as an independent power producer

· Coro to acquire 85% equity interest in a newly formed joint venture to be named Coro Renewables Vietnam (the "JV") in exchange for initial funding by Coro of US$500,000 to immediately develop a 5MW pilot rooftop project through to 'Ready to Build' status

· VPE, a highly regarded local EPC contractor, to transfer its existing 150MW project portfolio into the JV and provide management services in exchange for a 15% carried interest in the JV

· Coro have the option fund the 5MW pilot project through construction once de-risked with the option to fund the broader portfolio of over 150MW solar projects 

· All rooftop projects benefit from attractive economics and are underpinned by long term "take or pay" Power Purchase Agreements ("PPAs") with creditworthy industrial customers and US Dollar denominated pricing

Throughout the past two decades, Vietnam's GDP has grown in excess of 5% per annum fuelling significant power demand growth. To meet this demand, Vietnam is now planning 15-20% (approximately 35GW) of additional renewables capacity by 2030.

Coro and VPE have now signed a shareholder agreement to jointly develop VPE's existing 150MW portfolio of commercial and industrial rooftop solar PV installations creating a definitive joint venture agreement in Vietnam with Coro funding the JV for an 85% equity interest whilst VPE will transfer its existing 150MW project portfolio for a 15% carried interest. VPE will also provide EPC services to the JV at market benchmarked levels.

Coro will fund US$500,000 (specifically for planning and permitting costs) to de-risk a 5MW pilot project which is expected to achieve 'Ready to Build' status during 2022. Coro will then have the right to fund the construction of the 5MW pilot project, estimated at US$3.5m, with a view to securing near term cash flows (estimated at around US$0.6m per annum unlevered, net to Coro).  Furthermore, Coro will have the option to fund the entire 150MW portfolio held by the JV, likely through project finance.

VPE are a leading Vietnamese Solar asset owner and Engineering, Procurement and Construction contractor, with an experienced team of over 90 operations staff and extensive experience deploying solar PV systems in Vietnam.  

Mark Hood, Coro's CEO, commented:

"I am delighted to announce the entry of binding agreements in connection with our Vietnamese roof-top solar project, which moves Coro closer to maiden revenues with the pilot project and a step forward on our strategic goal of being a major regional player in the renewables space."

Further announcements will be made, as appropriate.

Coro Energy plc Mark Hood, Chief Executive Officer	Via Vigo Consulting Ltd
Cenkos Securities plc (Nominated Adviser) Ben Jeynes Katy Birkin	Tel: [phone]
Vigo Communications Ltd (IR/PR Advisor) Patrick d'Ancona Chris McMahon	Tel: [phone]
WH Ireland (Broker) Harry Ansell Katy Mitchell	Tel: [phone] / 44 (0)113 394 6618

This announcement contains inside information

 

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