REG - Oracle Power PLC - LOI Issued: 1,200MW Power/Green Hydrogen Project

Oracle PowerAnnouncement

15/09/2022 07:00

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RNS Number : 5192Z  Oracle Power PLC  15 September 2022

15 September 2022

 

Oracle Power PLC

("Oracle", the "Company" or the "Group")

 

LOI Issued for 1,200MW Power/Green Hydrogen Project

 

Oracle Power PLC (AIM:ORCP), the international natural resources project
developer, is pleased to announce that further to the announcement of 1
September 2022, the Company's joint venture company, Oracle Energy Limited
("Oracle Energy" or the "Joint Venture"), has been issued a Letter of Intent
("LOI") from the Directorate of Alternative Energy of the Government of Sindh
(the "Directorate of Alternative Energy"), relating to the establishment of a
1,200MW hybrid solar/wind, green hydrogen/power project (the "Project") in
Pakistan.  The issuance of the LOI follows the Directorate of Alternative
Energy's confirmation of receipt of a $600,000 bank guarantee (the "Bank
Guarantee") from Habib Metropolitan Bank, Karachi ("Habib Metropolitan") valid
for 12 months, on behalf of Oracle Energy.

 

Highlights / Key Terms of the LOI

 

·    The LOI sets out that the developer of the Project can produce green
hydrogen from a 400MW capacity electrolyser facility and renewable power for
business-to-business usage, for possible sale to utilities and for other uses.

·    In accordance with the LOI, Oracle Energy is required to complete
certain milestones in the next 18 months which include, inter alia,
feasibility and environmental studies, securing water use agreements,
completing grid studies for interconnection, obtaining a tariff from the
National Electric Power Regulatory Authority ("NEPRA") if required, providing
a further bank guarantee of US$3 million and receiving a Letter of Support
from the Directorate of Alternative Energy.

·    Oracle's share of the funding requirement for these milestones will
be from current cash and additional funding as required during the course of
development.

·    Provided the required milestones have been met by Oracle Energy up to
that time, the LOI can be extended beyond the initial 18 months, in the event
that the relevant regulator fails to announce or award a tariff due to delays
on the account of Government processes.  Extensions can be repeatedly
provided for six months at a time and during any period of extension, if the
tariff is awarded, Oracle Energy is required to obtain a Letter of Support by
submitting the required further US$3 million bank guarantee.

·    Oracle Energy will also coordinate with a panel of experts from the
Directorate of Alternative Energy to determine site layout, sub-station
design, transmission line, interconnection arrangements and other related
operational and technical matters.

·    The Directorate of Alternative Energy may terminate the LOI and
encash the Bank Guarantee if, inter alia, the requisite milestones are not
met, or the Bank Guarantee is not extended.

 

The Bank Guarantee provided by Habib Metropolitan on behalf of Oracle Energy
is valid for 12 months; however, Oracle Energy has been advised by Habib
Metropolitan that the guarantee can be extended at Habib Metropolitan's
discretion and subject to certain terms.

 

Naheed Memon, CEO of Oracle, commented:

 

"This LOI gives us the confidence to move forward determinedly with our
pioneering green hydrogen project in Pakistan.  With the support of the
Directorate of Alternative Energy, and of course our joint venture partner,
His Highness Shaikh Ahmed Dalmook Al Maktoum, we are in a solid position to
make material progress with our plans to establish a hybrid solar/wind, green
hydrogen/power project of up to 1,200MW in a rapid timeframe.

 

"As we look now to the milestones set out in the LOI, including relevant
studies and securing required infrastructure we will, in parallel, look to
deliver and expand our commercial initiatives to ensure we have a
comprehensive and wide-ranging array of options to maximise value for
investors, and commercialise this transformative energy source.  I look
forward to providing updates on our progress in this regard over the coming
weeks and months."

 

*ENDS*

 

This announcement contains inside information for the purposes of Article 7 of
EU Regulation No. 596/2014, which forms part of United Kingdom domestic law by
virtue of the European Union (Withdrawal) Act 2018, as amended.

 

For further information please contact:

 

 Oracle Power PLC                           +44 (0) 203 580 4314

 Naheed Memon

 Strand Hanson Limited (Nominated Adviser)  +44 (0) 20 7409 3494

 Rory Murphy, James Harris, Rob Patrick

 St Brides Partners Limited (Financial PR)  +44 (0) 20 7236 1177

 Susie Geliher, Catherine Leftley

 

About Oracle Power PLC:

 

Oracle Power PLC is an international natural resource and power project
developer quoted on London's AIM market. The Company currently has two areas
of focus: Western Australia and Pakistan. The Company is active in the energy
industry in Pakistan and is working to establish a green hydrogen production
facility through Oracle Energy Limited, a joint venture with His Highness
Shaikh Ahmed Dalmook Al Maktoum. The Company's initial project is the Thar
Block VI Project in south-east Pakistan where the Company is advancing plans
for a combined lignite coal mine, a 1,320MW mine mouth power plant and a
proposed coal gasification to urea project.

 

In Australia, its primary focus is the Northern Zone Gold Project, located
25km east of the major gold mining centre of Kalgoorlie, the home of the
'Super Pit' mine, the second largest gold mine in Australia.  Northern Zone
has a current Exploration Target of 200-250Mt at 0.4-0.6g/t Au for between 2.5
- 4.8Moz gold, with drilling being planned to define a maiden inferred JORC
resource.

 

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