EDP Renewables has made a non-binding offer to acquire Pilot Energy’s 367MW Three Springs solar development that aims to support the delivery of low carbon ammonia from the Mid West Clean Energy Project (MWCEP).
The offer remains subject to satisfaction of conditions precedent, and Pilot Energy said it anticipates completion of the transaction will occur prior to the close of the 2024 calendar year. The key terms of the offer include:
- Acquisition price $11.5 million (to be finalised after due diligence and documented in the asset sale agreement) over a series of staged payments
- Conditions precedent:
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- Parties entering into a definitive asset sale agreement
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- Completion of due diligence
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- Buyer internal approval
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- FIRB approval (if required)
Pilot Energy said that in addition to progressing the Three Springs project, the company has reviewed several alternative renewable energy sites to support the production of low carbon ammonia. The company said that the recently completed MWCEP Pre-FEED study has confirmed that combining carbon storage at Cliff Head with the region’s renewable energy resources has the potential to deliver industry leading low carbon intensity ammonia.
Pilot Energy’s MWCEP project team has identified opportunities to source renewable generation closer to the proposed ammonia project site. Pilot Energy said that divesting the Three Springs project allows the company to recycle capital into the newly identified locations and to continue progressing the MWCEP.
Pilot Energy Chairman, Brad Lingo, said, “The proposed sale is a great result for Pilot Energy, which will provide significant capital for the company to progress the Cliff Head Carbon Storage Project and the acquisition of the Cliff Head JV interests while also accelerating the development of renewable power sources in the mid-west to power the MWCEP.”
Image credit: Jenson/shutterstock.com.
