REG - ATOME Energy PLC - Iceland Update

AtomeAnnouncement

04/04/2023 07:00

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RNS Number : 2348V  ATOME Energy PLC  04 April 2023

4 April 2023

 

ATOME ENERGY PLC

 

Iceland Update

 

Term Sheet and Letter of Intent signed for up to 60MW of power

 

ATOME Energy (AIM: ATOM), the only international green hydrogen and ammonia
production company on the London Stock Exchange, with current large-scale
projects in Latin America and Europe, as well as hydrogen mobility projects,
announces material developments on its Icelandic business.

 

Highlights

 * Term sheet signed with HS Orka, a leading producer of renewable energy in
Iceland for up to 40MW of power

 * Letter of Intent signed with ON Power, another power provider, for up to 20MW
of power

 * Memorandum of Understanding ("MoU") signed with Samherji, one of Iceland's
largest fishing companies, for the decarbonisation of their marine fleet

 * Green Fuel's facility expected to be operating by end 2026 and to be one of
the first large-scale green ammonia projects in Europe

 * Domestic and international offtake opportunities

 

ATOME is pleased to announce that its 75% owned Icelandic subsidiary, Green
Fuel ehf ("Green Fuel"), has entered into a non-binding term sheet with HS
Orka, a leading producer of renewable energy in Iceland, for the supply of up
to 40MW from geothermal and hydroelectric power with the intention for both
parties to enter a binding Power Purchase Agreement ("PPA"), subject to
conditions, prior to year-end 2023. The power is due to be delivered for the
start of Green Fuel's commercial operation, scheduled in 2026.

 

In addition to the 40MW from HS Orka, Green Fuel has also signed a Letter of
Intent with ON Power, another company generating power from the same sources
in the country, for the supply of up to 20MW of renewable power which is
expected to be available from 2027.

 

Green Fuel's green ammonia facility will be one of the earliest large-scale
green ammonia projects in Europe at the time of its start-up targeted by the
end of 2026.

 

Strategy

Iceland is a prime location for green hydrogen and ammonia production, through
its 100% green electricity grid from baseload geothermal and hydro sources,
with a strong focus on decarbonising its domestic shipping and transport
sectors. Green Fuel's project is in full alignment with the country's domestic
needs.

 

Green Fuel's green products have the potential to significantly decarbonise
the maritime sector as a substitute for marine fuel. To this end, Green Fuel
has signed a Memorandum of Understanding ("MoU") with Samherji, one of the
largest fishing companies in Iceland, to collaborate on the development of
ammonia-powered fishing vessels. A working committee has been established with
both parties making early progress on realising the zero-emission
opportunities in the sector.

 

In Iceland, the maritime sector accounts for around 30% of the country's GDP
and is a significant contributor to the country's emissions. Maritime
transport represents approximately 4% (144 million tonnes p.a.) of the
European Union's CO2 emissions. By 2050, green ammonia is projected to make up
25% of all global marine fuel.

 

One of the principal drivers in the expected uptake of alternative fuels for
shipping (including green ammonia) has been the strengthening of emission
regulations from the International Maritime Organisation ("IMO") and the EU.
The IMO regulations cover energy efficiency, carbon intensity and sulphur
emissions while the EU's Green Deal and Fit for 55 programmes have brought in
controls for greenhouse gas emissions from all shipping travelling within and
to and from EU ports. The overall aim of the Fit for 55 programme is to
deliver a 55% reduction in carbon emissions by 2030. It is proposed under the
Green Deal that shipping be included in the EU's Emissions Trading Scheme from
as early as 2024, providing the financial framework for shipping companies to
be able to commit to long term alternative fuel offtake agreements.

 

As one the largest producers and exporters of green aluminium, Iceland already
has valuable experience in leveraging its green electricity for growing
industries. Green Fuel's project location also presents strong export
opportunities to the EU as demand grows for the decarbonisation of the EU's
energy-intensive industrial sectors. Green Fuel is collaborating on such
export opportunities, including under the MoU signed in 2021 with the Port of
Groningen, in the Netherlands. Furthermore, as a member of the European
Economic Area (EEA), Iceland qualifies for a number of EU grants and subsidies
such as the EU €95.5 billion Horizon Europe Research and Innovation funding
programme.

 

Olivier Mussat, CEO of ATOME Energy, commented: "Since our IPO in December
2021, we have made significant progress in Paraguay, and with our move into
Central America through our newly created business, the National Ammonia
Corporation, we have expanded our near-term pipeline of projects to over
500MW+. Today's announcement is a reflection of the work done over the past
couple of years in putting in place the building blocks required to generate
value for shareholders through Green Fuel in Iceland."

 

Siggi Olason, CEO of Green Fuel ehf, added: "We are delighted to have achieved
this important milestone on our journey towards providing sustainable,
carbon-free fuel for the shipping industry. It has been a pleasure working
with HS Orka and Samherji, who share our commitment to tackling the climate
challenge with determination. We believe that international and regional
regulations will be key in driving the adoption of green ammonia as a fuel to
reduce carbon and sulphur emissions from shipping. Here in Iceland, we are
proud to lead this change, and Green Fuel is well positioned to meet the
expected demand as these regulations come into effect."

 

Tómas Már Sigurðsson, CEO HS Orka: "Climate change is high on our agenda,
and we recognise the importance of this project for the decarbonisation of the
shipping industry and the increasing demand for green ammonia to be used in
fuels. We look forward to working alongside Green Fuel to ensure a sustainable
future for Iceland."

 

Thorsteinn Már Baldvinsson, CEO Samherji: "Since our company's founding,
we've always been dedicated to using the latest technology and sustainable
practices to produce the highest quality seafood while minimizing waste and
reducing our environmental impact. From fully utilizing every part of the fish
we catch to reducing our oil consumption, we've always strived to be
responsible stewards of our planet's resources. And now, as we take big steps
in the energy transition, we're proud to continue this tradition and operate
in harmony with nature, ensuring a sustainable future for generations to
come."

 

For more information, please visit https://www.atomeplc.com
(http://www.atomeplc.com/) or contact:

 

 ATOME Energy PLC                                  +44 (0) 113 337 2210
 Nikita Levine, Investor Relations
info@atomeplc.com
 Beaumont Cornish (Nominated Adviser)              +44 (0) 20 7628 3396
 Roland Cornish, Michael Cornish
 Liberum (Joint Broker)                            +44 (0) 20 3100 2000
 Scott Mathieson, Kane Collings
 SP Angel (Joint Broker)                           +44 (0) 20 3490 0470
 Richard Hail, Caroline Rowe
 finnCap (Joint Broker)                            +44 (0) 20 7220 0500
 Christopher Raggett, George Dollemore

 Tavistock (Financial PR and IR)                   +44 (0) 20 7920 3150
 Simon Hudson, Rebecca Hislaire, Charles Baister   atome@tavistock.co.uk

 

The information communicated within this announcement is deemed to constitute
inside information as stipulated under the Market Abuse Regulations (EU) No
596/2014 which is part of UK law by virtue of the European Union (Withdrawal)
Act 2018. The person who arranged for the release of this announcement on
behalf of the Company was Peter Levine, Chairman.

 

 

About Atome

Atome Energy PLC is an AIM listed company targeting the decarbonisation of
hard-to-abate industries, such as agriculture and shipping, through the
production of green commodities such as hydrogen, ammonia and fertilisers.
Atome has a global portfolio of over 500-megawatt of projects in Paraguay,
Iceland and Central America, utilising existing and excess renewable power to
fast-track the production of these essential products that enable both energy
and food security around the world.

 

Upon listing on AIM, Atome was awarded the Green Economy Mark reflecting its
contribution to transitioning to a society centred around decarbonised
commodities. The Company has a green-focused Board which is supported by major
shareholders including Peter Levine, Trafigura, one of the world's leading
commodity and logistics company, and Schroders, a leading fund manager.

 

 

 

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