20th Dec 2006 07:01
Renewable Energy Holdings plc20 December 2006 20 December 2006 Renewable Energy Holdings plc ("REH" or "the Company") Kobylany Wind Farm, Poland REH is pleased to announce that it has entered in to a non-binding letter ofintent ("LOI") relating to the purchase of the Kobylany Wind Farm site in Polandfrom a consortium of Polish companies and individuals ("Consortium"). TheKobylany Wind Farm, located near the town of Kobylany in southern Poland, isstill at the planning stage and is expected, when developed, to represent 30 MWof generating capacity. The Consortium has prepared plans for the Kobylany Wind Farm which envisage 30MW of generating capacity with an accompanying off-take infrastructure andtransformer station. The Consortium has obtained or is in the process ofobtaining the necessary opinions, administrative decisions, permits, assurances,consents, geological and engineering documentation, pictoral maps, wind speedmeasurements and productivity, technical and economic analysis of the wind farmand environmental protection reports necessary for the development of theKobylany Wind Farm. The LOI further provides for the Consortium to carry outall necessary acts to enable REH to acquire rights under administrationdecisions, conditions, determination, opinions, expert reports, rights andpermits for construction necessary to construct the Kobylany Wind Farm and tosecure the necessary land rights over land through which the interconnectioncables will be routed to connect the wind farm to the national grid. Allmatters listed above will be addressed prior to REH entering into a bindingcommitment with the Consortium or, to the extent that such matters are notaddressed to the satisfaction of REH at that stage, they will form conditionsprecedent to financial completion of the purchase of the Kobylany Wind Farm siteby REH. It is the intention of REH (via a wholly owned Polish subsidiary to be formed)and the Consortium to agree and enter in to a binding agreement ("the Agreement") relating to the purchase of the Kobylany Wind Farm project by REH on around28 February 2007 and, in any event no later than 10 months following that date.The terms of any such agreement would provide for a consideration payable by REHto the Consortium of €68,000 (plus VAT) per MW of generating capacity. TheAgreement would allow for an initial lease term of 25 years of the site at whichthe Kobylany Wind Farm substation is to be located, with an option to extend fora further 25 years, for an annual lease payment of €25,000 (plus VAT). Inaddition, an annual lease payment of €7,000 (plus VAT) will be payable for eachwind turbine located on the site. It is expected that there will be 15 windturbines at the site. Following acquisition of the Kobylany Wind Farm site, REH intends to use enXco,a subsidiary of EDF Energies Nouvelles SA, to manage the construction andcommissioning of the wind farm. The Company is at an advanced stage in arranging a debt facility for this andother projects with a leading bank in the sector. The facility will, whengranted, also extend to the refinancing of the Company's existing investment inWales which would free up existing equity for deployment elsewhere within theGroup. Commenting on this proposed investment, Mike Proffitt, Chief Executive Officerof REH, said: "Poland has enacted very encouraging legislation to support theinvestment in wind farms in its jurisdiction. This support is largely in theform of green certificates (similar to ROCs) which currently have a market valueof approximately €50 per MW. Further, the area of Kobylany Wind Farm in thesoutheast mountainous region of Poland enjoys a strong wind regime some 15 percent. higher than more central parts of the European continent. We are verypleased with the development of this investment opportunity as it follows theBoard's policy to diversify geographically across Europe." -End- For further information, please contact: Renewable Energy Holdings plc Nabarro Wells & Co. Limited Parkgreen CommunicationsMike Proffitt, Chief Executive Richard Swindells Ben KnowlesTel: 01624 641199 Tel: 020 7710 7400 Tel: 020 7851 7480 Mob: 07900 346 978 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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