Simec Atlantis Share News (SAE)

(Sharecast News) - Sustainable energy generation company SIMEC Atlantis Energy has signed heads of terms to sell a 25% shareholding in Uskmouth Power for £32.9m cash, it announced on Tuesday, to infrastructure fund manager Equitix.The AIM-traded firm said the existing Uskmouth coal-fired power plant would be converted to generate electricity from 100% waste-derived energy pellets.Following conversion, the power station would generate 220 MW of baseload power, using energy pellets produced from non-recyclable waste destined for landfill, with an average calori?c value of 20 MJ per kg.Uskmouth Power had already agreed 20-year power purchase agreements and a 20-year fuel supply agreement.Atlantis said that under the 20-year power purchase agreements, a proportion of the electricity generated would be sold to the adjacent energy pellet processing facility at an indexed fixed price, with the remainder exported to the grid and benefiting from an indexed floor price with potential upside from higher market prices.The conversion was expected to take 18 months post-completion of front-end engineering and design (FEED), and the converted station would have an operational life of at least 20 years."Equitix is one of the most sophisticated and experienced investors in the waste-to=energy sector in the UK," said Atlantis chief executive officer Tim Cornelius."They will bring expertise in financing, EPC contracting and negotiation, waste contracting and offtake negotiation to this world leading project."Cornelius said the company was "obviously delighted" bring welcome Equitix into the project as a co-funder, adding that it was also their personnel, investment track record and credibility in the infrastructure markets globally that had his team "so excited"."This is a huge milestone for Uskmouth Power which will ensure the UK is ready for a future focused on reduced coal and increased renewable energy generation."Hugh Crossley, chief investment officer of Equitix, added that the transaction represented a "great opportunity" for Equitix to invest in a sector in the UK that fit well with its core infrastructure strategy."We are committed to investing for the long-term in projects like Uskmouth Power which we expect will help us to continue to offer our investors predictable yields through stable, long-term cash flows underpinned by its robust contractual structure," Crossley said."Uskmouth Power is the latest addition to Equitix's significant capabilities in the renewable energy sector."Crossley said Equitix had built its expertise through bidding, developing and managing renewable energy projects."Today, Equitix manages a diversified portfolio of high quality investments, including over 2.5 gigawatts of transmission and generation assets across a range of different technologies including solar, onshore wind and waste processing."Equitix has a strong in-house technical, operational and regulatory expertise in renewables and regulated assets."