Kibo acquires advanced UK waste-to-energy project
Renewable energy-focused development company Kibo Energy has announced it has signed a definitive Share Purchase Agreement (SPA) to acquire a 100% interest in a waste reception anaerobic digestor (AD) and CHP power plant (Southport) at Merseyside, UK.
The acquisition of Southport, a 12MW waste-to-energy project in the UK, is in line with the Kibo's refocused strategy to acquire and develop an energy portfolio centred around sustainable, renewable and clean energy solutions and opportunities, as detailed in a company RNS dated 19 April 2021.
Southport comprises a waste-reception centre designed to accept up to 80,000 tonnes of 'trommel fines' (also known as municipal solid waste or 'MSW fines') per annum.
The waste reception centre and power plant utilise anaerobic digestion technology that will create 5.5 million cubic metres (m3) of bio-methane combined with a 10 MW CHP plant.
The primary purpose of the plant will be to produce an organic fraction from the incoming waste, which will be processed through anaerobic digestion to generate bio-methane that will, in turn, be exported to the UK's national gas grid network.
The CHP plant will generate electricity to be utilised for internal usage of the AD facility (c.2 MW) and to be exported to the local grid (c.8 MW). Southport is also planning a 2MW battery storage facility.
The transaction
Kibo continues to advance its strategy to rapidly grow its renewable energy portfolio and capitalise on sustainable growth that will deliver long-term value for shareholders. In line with this, it has signed an SPA to acquire the Southport waste gasification and power plant.
Under the terms of the agreement, Kibo Energy will acquire 100% of Shankley Biogas, including all its rights and obligations for the development, construction and operation of Southport.
The purchase consideration is £600,000 with £350,000 payable as ordinary shares of the company at an issue price equal to the 20-day volume-weighted average price of the 20 days preceding the closing date of the acquisition.
The balance of £250,000 payable in cash, is to be paid as £50,000 within 14 days of the closing date, an amount of £75,000 on the earlier of the date on which the new board of directors of Shankley shall have approved a final financial model and project investor memorandum for debt and project funding following the closing date, or on financial close, and £125,000 on reaching financial close.
Project rights include all technology license agreements, all equipment supply and maintenance agreements, held by Shankley Biogas. This includes the agreed projects configuration with Anaergia, a global technology and process engineering company that provides integrated solutions and technologies for the processing of waste streams.
The scope of work includes the full engineering, procurement and construction of the Southport plant based on a fixed-price, lump-sum contract for the capital works scope and a separate minimum five-year duration contract to technically operate the Southport plant in its entirety.
Louis Coetzee, CEO of Kibo Energy, said: "We believe this opportunity supports our strategic intent to significantly advance and accelerate the development of the company's renewable energy portfolio in the United Kingdom. The project further deliberately and actively drives Kibo's transition from fossil fuel-based energy solutions to sustainable renewable energy solutions and will now bring our waste-to-energy ('WTE') portfolio to an aggregate of c.140,000 MWh per annum, with this entire capacity expected to go into production over the next 12 to 18 months. The company furthermore expects to further advance its renewable / clean energy portfolio with the ongoing work related to converting its existing energy projects in Tanzania, as announced in a Company RNS dated 27 May 2022.
"This is indeed an exciting new chapter in the business, one that aligns with the UK's move to an electricity system that is secure, affordable and employs increasing amounts of variable renewable energy generation options, as stated in the 2016 report by the Carbon Trust, in collaboration with the Imperial College, 'An Analysis of Electricity System Flexibility for Great Britain'".
