RE: Billingham15 Dec 2020 21:49
This rise is not only based on Billingham. Its mainly based on Deeside. Deeside is now 100% owned by EQT its a 20Mw plant non unlike Billingham which is 25Mw. Deeside has always had the option and not the obligation to acquire ownership, of which EQT have now exercised. Billingham has not yet even signed an agreement for the option to acquire so is currently some way behind Deeside in terms of contractual progress.
It may be that EQT not only obtain the option but also exercise at the same time hence the extensions.
The rise is also to do with a focus on renewable/sustainable and green energy. EQT looking significantly undervalued with a very large pipeline of projects and a growing enquiry pipeline of commercial opportunities.
Deeside is worth €40m in construction revenue and €20m in energy and gate fees per annum approximately. On top of that EQT will be paid from the SPV €2m for Ops and maintenance. Deeside is not insignificant and Billingham will be very similar. Its projects like this in the pipeline which is the cause of the rise. Southport, Carbon Sole (25% ownership option of 3 x 25Mw plants) US projects has 20% ownership plus construction revenues, plus ops and maintenance.
Its a rerate people and investors waking up to the potential. Fair value has not yet been reached. Billingham option will only increase fair value, as will Wood collaboration as will CarbonSole