Eco (atlantic) Regulatory News (ECO)

25 May 2007 07:02

EcoSecurities Group plc25 May 2007 EcoSecurities Group plc AGM Statement Dublin, Ireland - EcoSecurities Group plc ("EcoSecurities", or the "Group"), oneof the world's leading companies in the business of originating, implementingand commercialising carbon credits from greenhouse gas emission reductionprojects, will hold its Annual General Meeting in Dublin, Ireland today at 2 pm.At the meeting Mark Nicholls, Chairman, will make the following statement: "EcoSecurities' first full year of trading in 2006 as a public company provedsuccessful. The Group achieved many significant milestones with regard to theorigination, implementation and commercialisation of Certified EmissionReductions ("CERs"). Progress has been maintained in 2007. The Group continuesto execute its CDM strategy, as well as capture new carbon market opportunitiesclosely aligned with the core business. A number of milestones have been achieved to date in 2007 which include: • CDM project origination has progressed steadily with the gross contractvolume of the Group's projects increasing to 178 million CERs at present - anincrease of 14% since year end 2006. In line with the Group's policy ofcontinually assessing the projects within the portfolio for expected CERgeneration, this total takes into account volume adjustments. As projectsprogress through the CDM implementation cycle and become operational,EcoSecurities' confidence in project volumes and individual project performancebecomes more certain. • On a net entitlement basis the CER portfolio has grown by 23% to 156million tonnes since year end, reflecting the Group's focus on principalprojects and the purchase of CERs from projects where the Group previously had ashared interest. • With many governments indicating their long term commitment to emissionreduction schemes, e.g. the EU's commitment to the ETS post-2012, Canada'srecent commitment to emissions reductions by 2020, California's post-2012legislation and current global debate surrounding Kyoto's second commitmentperiod; the Group is confident that a market regime for post- 2012 carboncredits will evolve and that it is well placed to benefit. • As the potential market for carbon credits post-2012 develops, the Grouphas continued to expand its portfolio of carbon credits for delivery after theinitial Kyoto commitment period. Out of its existing portfolio of projects theGroup has already secured the rights to 86 million tonnes of carbon credits forthe period from 2013 to 2028. Furthermore, project opportunities that extendbeyond 2012 are now being pursued more aggressively. • In order to continue expansion of the Company's origination,implementation, commercialisation and consulting efforts, the Group hasestablished 4 new offices in Dubai, Kiev, Rome and Tokyo this year. • The CDM project portfolio remains highly diversified by geography,technology and CDM methodology, with a total of 426 projects, up from 353 atyear end. The projects are located in 36 countries and encompass 18 differenttechnologies. Project diversification, as well as our track record in projectimplementation, significantly enhances our ability to generate consistentproduction of CERs from our growing project portfolio. • CDM project implementation continues to progress. Of the 426 projects inthe portfolio, 336 are now financed, 104 are under construction and 146 areoperational. At present, 66 projects have been registered with the CDMExecutive Board, up from 53 at year end. These results were achieved in spiteof the fact that the external process of CDM project validation, host countryapproval and CDM EB registration has been difficult over the past year andcontinues to be challenging. • Demand for CERs from corporate and government buyers with 2008-2012 Kyotocompliance obligations continues to grow. To date the Group has pre-sold €400million of CERs to predominantly large corporate and government buyers whichrepresents a steady stream of revenues for the Group from 2008 through to 2012. The expected Net Trading Margin on current forward CER sales of 33 milliontonnes now totals €177 million. • Recently, CER prices have been increasing in line with demand in Japan andthe EU. Substantially tighter National Allocation Plans proposed for Phase IIof the EU ETS have contributed to this positive trend. • Due to the increasing issuance of CERs from projects around the world,EcoSecurities is well positioned to participate as a principal in the secondarytrading of CERs from project developers. This year the Group has alreadyacquired 1 million CERs in this manner. • With increasing corporate and individual awareness regarding climate change,the emergence of voluntary carbon markets in the US and internationally is amajor development. The Group has begun to expand into these markets as asupplier of high-quality Voluntary Emissions Reductions (" VERs") and hascompleted its first sales. The Group has a growing portfolio of VERs, and willcontinue to build upon its strategy to be a wholesale supplier of the higheststandard VERs in this market. EcoSecurities is working within the initiative ofthe International Emissions Trading Association, the World Economic Forum andthe Climate Group to develop a Voluntary Carbon Standard for VER projects, whichwill allow for greater standardization in this market segment. In the USparticularly, the Group has experienced a rapid increase in demand for VERs tomeet both voluntary and pre-compliance needs (the latter based on the assumptionthat US climate change legislation will be enacted in the foreseeable future). EcoSecurities' target for the rest of the year is to maintain its core focus onoriginating, implementing and commercialising its highly diversified portfolioof emissions reductions projects. Furthermore, the Group sees a number ofopportunities in closely aligned markets for VERs, issued CERs and CDM projectinvestments as well as building its project portfolio beyond 2012." + Note: Gross and net contract volume measure expected CER production, as at 24May 2007, from projects through to the end of 2012 and do not adjust foroperating or regulatory risk. Gross and net contract volume exclude projectswhere the probability of either the development of a relevant methodology or theunderlying development of the project is still highly uncertain. CDM = Clean Development Mechanism, the provision of the Kyoto Protocol thatgoverns project level carbon credit transactions between developed anddeveloping countries. CER = Certified Emission Reduction, carbon credits created by Clean DevelopmentMechanism projects. One CER corresponds to 1 tonne of CO2e emission reductions. EU ETS = European Union Emissions Trading Scheme, a market based "cap and trade"system for green house gases adopted by the European Union member states. Net Trading Margin = The resulting gross profit on the sale of CERs less thedirect purchase cost. VER = Voluntary or Verified Emission Reduction, carbon credits created byemission reduction projects. One VER corresponds to 1 tonne of CO2e emissionreductions. - Ends - For further information please contact:EcoSecurities Group plc Bruce Usher, CEO +353 1613 9814Pedro Moura Costa, COOJack MacDonald, CFO Citigate Dewe Rogerson +44 (0) 20 7638 9571Kevin Smith / Ged Brumby About EcoSecurities: EcoSecurities is one of the world's leading companies in the business oforiginating, developing and trading carbon credits. EcoSecurities structures andguides greenhouse gas emission reduction projects through the Kyoto Protocol,acting as principal intermediary between the projects and the buyers of carboncredits. EcoSecurities works with companies in developing and industrialising countriesto create carbon credits from projects that reduce emissions of greenhousegases. EcoSecurities has experience with projects in the areas of renewableenergy, agriculture and urban waste management, industrial efficiency, andforestry. With a network of offices and representatives in 25 countries on fivecontinents, EcoSecurities has amassed one of the industry's largest and mostdiversified portfolios of carbon projects. Today, the Group is working on 426projects in 36 countries using 18 different technologies (encompassing 29approved CDM methodologies), with the potential to generate more than 178million carbon credits. EcoSecurities also works with companies in the developed world to assist them inmeeting their greenhouse gas emission compliance targets. Utilising its highlydiversified carbon credit portfolio, EcoSecurities is able to structure carboncredit transactions to fit compliance buyer's needs, and has executedtransactions with both private and public sector buyers in Europe, North Americaand Japan. Working at the forefront of carbon market development, EcoSecurities has beeninvolved in the development of many of the global carbon market's most importantmilestones, including developing the world's first CDM project to be registeredunder the Kyoto Protocol. EcoSecurities' consultancy division has been at theforefront of significant policy and scientific developments in this field.EcoSecurities Consult has been recognised as the world's leading greenhouse gasadvisory firm over the last five years by reader surveys conducted byEnvironmental Finance Magazine. EcoSecurities Group plc is listed on the London Stock Exchange AIM (ticker ECO). Additional information is available at www.ecosecurities.com. This information is provided by RNS The company news service from the London Stock Exchange