RE: altair drawdown15 Jun 2019 13:05
Ian is Q1: Now, the Company has signed a legally binding agreement with Phoenix and North Fork Community Development Council to acquire 19.99% ownership of North Fork Community Power. What benefits will this bring to EQTEC?
A1: This deal is the next to be delivered under the framework agreement we announced recently with Phoenix Energy, our strategic partner in the US. It’s a template of how we want to work with our partners inside this framework agreement arrangement, particularly where projects are close to contract signature, all the necessary agreements are in place and where we can make an impact on the process by taking strategic equity position.
The North Fork project is exactly that, our equity position accelerates the delivery of the project and we expect to sign that contract and begin work by the end of June 2019.
We’ll also benefit from receiving dividends from the strong cash flow that’s in the project once it’s operational and the initial investment is paid back.
In summary, the ownership position in the project will help build the balance sheet for the company and also, give us access to long term recurring revenues.
We’re also extremely pleased with the partnership developed with Phoenix Energy and we’re already in discussions with them to assist on the execution on another project within the framework agreement, that’s a 3 megawatt plant in Wilseyville, California.
So, it’s a real advantage for us developing a pipeline of projects with the same partner as we’re able to progress developments and contracts much more quickly with a standardised process for document delivery and execution.
Q2: The company expects to invoice NFCP, under a separate sales contract, for the sale of further equipment and the supply of engineering and design services to NFCP. Can you expand on this for us?
A2: So, as well as the supply of equipment we have in stock that we’re supplying from the project, there’s also a requirement to provide some additional new equipment which is under the scope of our supply.
So, we’ll be delivering the engineering design for the project with construction to commence almost immediately and this will bring around about €2.2 million for the company.
These revenues will be delivered over the next 6-12 months as we progress with the construction of the project according to its delivery milestones and we start off by receiving a 25% fee at contract signature, the rest of the payments as per the scheduled milestones.
Q3: EQTEC has a key emphasis on expansion and growth, what are the main targets for the remainder of 2019?
A3: As we’ve emphasised recently, with our focus on our 3 business verticals, our targets are really to delivery the framework agreements with these key strategic partners to set up the business, to deliver the contracts and revenues that our shareholders are looking for and rightly, expect.
We anticipate a number of other JV agreements with established partners in the coming weeks and the i
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