REG - Kibo Energy PLC - Kibo Subsidiary MAST Announces Business Update

Kibo EnergyAnnouncement

11/04/2024 07:00

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RNS Number : 1098K  Kibo Energy PLC  11 April 2024

Kibo Energy PLC (Incorporated in Ireland)

(Registration Number: 451931)

(External registration number: 2011/007371/10)

LEI Code: 635400WTCRIZB6TVGZ23

Share code on the JSE Limited: KBO

Share code on the AIM: KIBO

ISIN: IE00B97C0C31

('Kibo' or 'the Company')

 

Dated: 11 April 2024

 

Kibo Energy PLC ('Kibo' or the 'Company')

 

Kibo Subsidiary Announces Business Update

 

Kibo Energy PLC (AIM: KIBO; AltX: KBO), the renewable energy-focused
development company, announces a business update by its subsidiary Mast Energy
Developments PLC ('MED'), a UK-based multi-asset owner, developer and operator
in the rapidly growing flexible power market.

 

Further details can be found in the full  MED RNS  Announcement, which is
available below and at med.energy (https://med.energy/?page_id=3140) .

 

-------------------------

 

Dated: 11 April 2024

 

Mast Energy Developments PLC ('MED' or 'the Company')

 

Business Update

 

Mast Energy Developments PLC, the UK-based multi-asset owner, developer and
operator in the rapidly growing flexible power market, is pleased to announce
an update regarding business operational matters.

 

HIGHLIGHTS

 

·    The initial first phase work programme at MED's Pyebridge 9MW
flexible power generation asset ("Pyebridge") successfully completed ahead of
schedule, with the site now officially back into operation.

 

·    Initial pre-construction work completed at MED's 7.5MW Hindlip Lane
flexible power generation project ("Hindlip"), and Certificate of Lawful
Commencement granted.

 

FURTHER INFORMATION

 

Pyebridge

 

Further to the Company's previous announcement dated 28 February 2024, the MED
management team successfully completed the initial work programme ahead of
schedule at its Pyebridge 9MW flexible power generation asset ("Pyebridge"),
with the site now officially back into operation.

 

Resultingly, MED was able to schedule and perform the minimum 3x separate
generation runs ahead of schedule to meet its Satisfactory Performance Days
("SPD") requirements that are due by the end of April 2024 under its existing
T-1 Capacity Market contract (the "CM Contract"). It is expected that
Pyebridge will pass its next SPD test, and retain the CM Contract's associated
annual gross profit margin income of c. £308,000 which is paid and received
monthly in arrears.

 

Additionally, as previously announced the Pyebridge site has secured further
Capacity Market contracts to ensure minimum annual gross profit margin income
as follows:

 

·    T-1 2024/2025 CM contract - c. £183,000 gross profit margin income;

·    T-4 2026/2027 CM contract - c. £312,000 gross profit margin income;
and

·    T-4 2027/2028 CM contract - c. £322,000 gross profit margin income.

 

MED expects to bid for and secure an additional T-1 Capacity Market contract
for the 2025/2026 delivery year in the next upcoming Capacity Market auction,
thereby ensuring uninterrupted guaranteed income until 2028. The Site's
existing Capacity Market contracts are all fixed one-year contracts. MED
expects to apply for the maximum 15-year term and capacity T-4 Capacity Market
contract in due course.

 

The Pyebridge site's Capacity Market contracts' gross profit margin income
payments are in addition to its electricity generation trading revenue
generation via its PPA with Statkraft. The plan and intention is to add a
minimum guaranteed gross profit margin income floor component to its PPA with
Statkraft (the "PPA Floor"). The PPA Floor value is currently expected to be
at around £50/kW/annum, subject to certain usual conditions such as
assessment and agreement by Statkraft, which would equate to an additional
minimum annual gross profit margin income of £405,000.

 

Both the above referred longer-term Capacity Market contract and the PPA Floor
are expected to be implemented once the Pyebridge site's planned overhaul work
programme as referred to below has been completed, in order to provide further
enhanced and longer term minimum guaranteed gross profit margin income to the
site.

 

Further, following the successful completion of the first phase of the work
programme, the plan and intention is that the next larger second phase work
programme (the "2(nd) Phase") will be initiated shortly. The 2(nd) Phase will
be performed in separate consecutive tranches on each of the Pyebridge site's
3x gensets, and is expected to take around 6 to 8 weeks per genset.

The cost of the 2(nd) Phase will be funded under the new funding agreement as
recently announced.  The 2(nd) Phase will involve the following main
improvements to the site and gensets, in order to get the site up to its full
efficiency, revenue generation and profitability potential:

 

·    Complete long-block and major parts replacements and full overhauls
for each of the existing 3 x Jenbacher J620 engines.

·    Replacement engine long-blocks will feature upgraded internal
deflagration protection technology, which will significantly reduce the risk
of potential damage due to engine backfires.

·    The overhauls will ensure optimal overall generation efficiency,
reduced operations- and maintenance costs and downtime, and optimal overall
availability.

 

Hindlip and MED's other existing sites

 

Initial pre-construction work at Hindlip was successfully completed to satisfy
planning consent requirements. As a result, the site's Certificate of Lawful
Commencement has been granted.

 

The following MED sites, Hindlip (7.5MW), Bordesley (4.5MW) and Rochdale
(4.5MW) are each construction-ready, with all required key cornerstones of a
flexible generation site in place and in good standing, most notably fully
specified EPC and O&M offers, planning consent, gas connection offer, grid
connection offer and construction management plan. Subject to capex funding,
these sites will immediately continue with the construction phase with an
expected timeline to commercial operations date of around 12 months from
receipt of funding, to go into production and revenue generation.

 

Project Capex Funding

 

As stated above, most of MED's sites under development are either ready for
construction, or in early-stage construction, subject to securing project
capex funding. In order to address this key next step in these projects'
development lifecycle to get each project into production as quickly as
possible, MED is currently in discussions with various potential debt and
equity funders, including banking institutions that are interested to provide
the necessary capex funding.

 

Pieter Krügel, MED CEO, commented: "We are pleased to have successfully
completed the first phase work programme at Pyebridge, and that the site is
now back into operation. We are looking forward to initiating the next 2(nd)
Phase work programme shortly, which when successfully completed will see the
site operating and generating income at its full expected efficiency,
availability and profitability potential. We will update the market with
progress in due course."

 

ENDS

 

This announcement contains inside information for the purposes of the UK
version of the Market Abuse Regulation (EU No. 596/2014) as it forms part of
United Kingdom domestic law by virtue of the European Union (Withdrawal) Act
2018 ('UK MAR'). Upon the publication of this announcement, this inside
information is now considered to be in the public domain.

 

For further information please visit www.med.energy (http://www.med.energy/)
or contact:

 Pieter Krügel   info@med.energy (mailto:info@med.energy)  Mast Energy Developments PLC  CEO
 Jon Belliss     +44 (0)20 7399 9425                       Novum Securities              Corporate Broker

 

_________________________

 

**ENDS**

 

For further information please visit www.kibo.energy (http://www.kibo.energy/)
or contact:

 

 Louis Coetzee                info@kibo.energy (mailto:info@kibo.energy)  Kibo Energy PLC             Chief Executive Officer
 James Biddle Roland Cornish  +44 207 628 3396                            Beaumont Cornish Limited    Nominated Adviser
 Claire Noyce                 +44 20 3764 2341                            Hybridan LLP                Joint Broker
 Damon Heath                  +44 207 186 9952                            Shard Capital Partners LLP  Joint Broker

 

Beaumont Cornish Limited ('Beaumont Cornish') is the Company's Nominated
Adviser and is authorised and regulated by the FCA. Beaumont Cornish's
responsibilities as the Company's Nominated Adviser, including a
responsibility to advise and guide the Company on its responsibilities under
the AIM Rules for Companies and AIM Rules for Nominated Advisers, are owed
solely to the London Stock Exchange. Beaumont Cornish is not acting for and
will not be responsible to any other persons for providing protections
afforded to customers of Beaumont Cornish nor for advising them in relation to
the proposed arrangements described in this announcement or any matter
referred to in it.

 

Johannesburg

11 April 2024

Corporate and Designated Adviser

River Group

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