Breaking Ground of CHO Morcenx (France)

Dec 02, 2010, 01:55 ET from Europlasma

    BORDEAUX, France, December 2, 2010 /PRNewswire-FirstCall/ --

    - An investment of more than EUR40 million in a Waste and Biomass to
      Energy plant
    - This is the first of its kind, delivering up to 12MW of Electricity
    - Construction phase started on December 1st, 2010
    - The Europlasma Group will own, through its CHO Power subsidiary, at
      least 25% of CHO Morcenx
    - A strong positive impact in the FY 2010 accounts of the Group
    - Long term contracts closed for the feedstock supply from Sita and
      Veolia and for the electricity sales to EDF

Europlasma announces the formal agreement by the investment fund specialized in the renewable energies for the financing of the electricity from waste and biomass plant in Morcenx (France). The construction of CHO Morcenx started on December 1st, 2010.

Financing of CHO Morcenx and agreement on the financing terms of 2 further plants

After a negotiation period that started in March 2010, the investment fund has agreed to fund more than EUR25 million into the CHO Power plant in Morcenx. This highly-expected conclusion was reached thanks to both successful capital increases in Europlasma performed during the summer (EUR6.3 million). The plant is designed to produce 12MW of electricity and represents a total investment of more than EUR40 million.

The group will own 25% of CHO Morcenx SAS (plant SPV), at the launch of operations for an initial cash investment of EUR3 million. This initial stake will rise up to 45% based notably on the achievement of performance milestones. The partner fund brings more than EUR25 million. The Credit Agricole d'Aquitaine lends EUR6.2 million for real estate and dryer materials. The power generators costing EUR6.4 million will be financed separately. The target unlevered return of the project (IRR) is expected to exceed 15%.

The Group and the financial partner agreed the financing terms for two other plants of same capacity (2 x 12MW).

This 12MW plant represents the first of its kind

The construction works on CHO Morcenx started on December 1st, 2010, for an operating launch expected in 2012.

CHO Morcenx is the first electricity from industrial and commercial waste and biomass plant using the Group's proprietary plasma technology. CHO Morcenx will sell the produced electricity to EDF under a Power Purchase Agreement (PPA) for 20 years. Moreover, outline feedstock supply agreements have been signed with the major industrial groups Sita and Veolia.

This is a major step forward for the Group, which will now accelerate the qualification of further potential sites for plants around the world. The Group has already identified a number of potential projects comparable to CHO Morcenx.

Short and mid-term financial impact

Terms and conditions of the agreement remain the same as those previously communicated (cf. press releases of June 14th and 22nd 2010).

The Group will benefit financially from CHO Morcenx through the EPC and O&M contracts, as well as from the equity value and future dividends it enjoys as an owner of the plant.

CHO Power SAS (fully-owned subsidiary) will be the EPC contractor, therefore recognizing EUR25.8 million in revenue over the next 18 months.

Inertam SAS (fully-owned subsidiary) will act as the O&M contractor and will receive approximately EUR8 million in O&M revenue per year for a period of 15 years.

About Europlasma

Founded in 1992, Europlasma is a French Group specialized in clean technologies and renewable energy production. The Europlasma Group is made up of four main units and 260 employees who are all firmly committed to sustainable development and experts in waste processing and reclamation.

    - Europlasma develops, produces and markets waste processing and energy
      production solutions based on its proprietary plasma torch technology.
    - Inertam is the global specialist for the destruction and reclamation
      of asbestos and hazardous waste.
    - CHO Power is a waste gasification power producer (EfW - Electricity
      from Waste).
    - Europe Environnement is the European market leader for ventilation and
      air depollution systems for industry.


    Press and investor contacts

    Europlasma                                  Calyptus
    Didier Pineau, Chief Executive Officer      Marie Ein / Alexis Breton
    contactbourse@europlasma.com                Tel: +33-1-53-65-68-68 /
                                                europlasma@calyptus.net

SOURCE Europlasma