Fjord Defence Group ASA

Environmental & Social Information • Nov 5, 2021

Carbon Transition’s portfolio company, Arbaflame, enters into substantial letter of intent with the Ministry of Energy of Romania

Carbon Transition’s portfolio company, Arbaflame, enters into substantial letter of intent with the Ministry of Energy of Romania

Oslo, 5 November 2021

Carbon Transition is pleased to announce that its portfolio company, Arbaflame AS, has entered into a letter of intent with the Ministry of Energy of Romania. Under the letter of intent, Arbaflame and the Ministry of Energy of Romania will cooperate on a coal replacement verification test program through the first half of 2022. Subject to a successful test program, the Ministry of Energy of Romania will grant Arbaflame a 10-year offtake agreement for 100,000 tonnes per year of Arbacore wood pellets to be produced at a new Arbaflame production facility to be built in Romania.

The agreement provides for further capacity expansion of 2 million tonnes per year (representing 20 ArbaNEXT plants), sufficient to replace approximately 10% of Romania’s coal consumption. Additionally, the Ministry of Energy of Romania will work with Arbaflame’s research and development team to utilize Romania’s biomass to fully phase out the country’s coal production of approximately 20 million tonnes per year (representing in excess of 200 ArbaNEXT plants).

"Carbon Transition is very pleased that Arbaflame and the Ministry of Energy of Romania have entered into such a substantial letter of intent, which targets to fully replace Romania’s coal consumption. We are very excited to see that Arbaflame is getting acceptance for its technology from a large European Union country, and which could have a transformative impact on Arbaflame’s business, the Romanian power production sector, and as a consequence enable large reductions of carbon emissions," says Gisle Grønlie, Chairman of the Board of Carbon Transition ASA.

On 7 July 2021, Carbon Transition announced that it had made a NOK 30 million investment in a convertible loan in Arbaflame AS, a company with revolutionizing technology which significantly reduces Co2 emissions in energy production from coal-fired power plants. For further information, see the stock market announcement: https://newsweb.oslobors.no/message/537646

For further information about Arbaflame’s letter of intent with Ministry of Energy of Romania, please see the attached press release.

For further information about Carbon Transition's investment in Arbaflame, please contact:

Gisle Grønlie, Chairman of the Board

gisle.gronlie@magnoraasa.com

+47 917 51 194

Nils Haugestad, CFO

nils.haugestad@carbn.no

+47 977 04 439

About Carbon Transition ASA

Carbon Transition ASA ("CARBN") is an investment company listed on Euronext Expand. CARBN has a strategy to invest in companies and technologies which contribute to significant reductions of carbon emissions. The company may also invest more broadly in the "energy transition" space. CARBN has a legacy seismic business operating under the name Axxis Geo Solutions, with both an ocean-bottom seismic contract business and a multi-client data library.

More information on www.axxisgeo.com