SIMEC Atlantis Energy losses widen as it pursues multiple developments
SIMEC Atlantis Energy Limited (DI)
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16:55 25/04/24
Sustainable energy developer, owner and operator SIMEC Atlantis Energy reported a consolidated group cash position of £5.1m as at the end of its first half on Thursday, down from £9.3m at the end of the 2018 financial year, and including £1.8m held at MeyGen, falling from £2.4m.
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The AIM-traded firm said it saw revenue of £2m in the six months ended 30 June, rising from £1.3m year-on-year, with the majority coming from MeyGen power sales.
Its group loss before tax was £12.4m, widening from £9.1m, with the board putting the £3.3m increase down to the consolidation of SIMEC Uskmouth Power from 15 June 2018.
Group total equity at 30 June stood at £117.6m, slipping from the £119.6m it reported as at 31 December.
Its board noted that in March, an equity fundraising raised more than £5m before expenses, with the net proceeds being used for the company’s general corporate services.
On the operational front, SIMEC Atlantis said the MeyGen tidal power project in Scotland had now exported more than 21 GWh of electricity to the national grid, with the array operating at above 90% availability factor during 2019 thus far.
The board said those were the “best operating results ever achieved” on the MeyGen project to date.
During September, the firm announced its ambition to develop the world's largest ocean powered data centre in Caithness, Scotland.
It said the data centre would accelerate the buildout of the MeyGen site, by providing a pathway to construction that was not reliant on the UK government's limited support schemes for renewable energy.
The project would also help Scotland build up more data resilience domestically, the board claimed, as well as providing access to “much needed” international data connections for Scotland.
In the same month, SIMEC Atlantis entered into a heads of terms with Alderney Electricity (AEL), which set out the intention to enter into a 25-year fixed price power purchase agreement covering a minimum annual load of 5GWh.
The board said the power purchase agreement would eventually underpin the financial investment case for its tidal power projects currently being developed in France, where tidal power generated in French waters would be exported to the Channel Islands.
At the firm’s flagship Uskmouth power station conversion project in Wales, the first stage of the front end engineering design (FEED) was completed in the first half, and a contract tender had been issued for the design, supply, installation and commissioning of the full combustion system, including large-scale combustion testing.
The results of that tender were expected “imminently”, with the board saying the conversion project remained on track to start operations by 2021.
“The performance of the MeyGen tidal power array during 2019 is testament to our investment and belief in the commercial scale prospects of tidal power to date,” said SIMEC Atlantis Energy chief executive officer Tim Cornelius.
“Reliable, predictable revenue generation from energy extracted in an environmentally benign manner.
“We now look forward to working with government and industry to deliver the next phases of MeyGen in partnership with world leading data centre operators and the local community in Caithness.”
Cornelius added that the Uskmouth conversion was making “good progress”, explaining that it was “a privilege” to be involved in the flagship project.
“This conversion addresses two major societal issues; firstly, the increasing demand for electricity and secondly the productive use of non-recyclable waste destined for landfill.
“Uskmouth tackles these issues whilst maintaining and creating jobs in south east Wales.”
He said the project represented the application of 21st century technology, being novel fuel development and emission abatement, to 20th century infrastructure, as in the repurposing of a coal-fired power station destined for decommissioning.
“The project also brings clear long-term regional socio-economic benefits to south east Wales, maintaining and potentially increasing employment in the Newport area.
“Importantly, it will provide flexible, baseload generation to local energy intensive companies in the Newport area.
“Both MeyGen and the Uskmouth project have created remarkable opportunities for the Atlantis team to forge new paths and demonstrate leadership in innovation and delivery of solutions for some of the challenges which face society today whilst at the same time creating near and long term shareholder value.”