Corre Energy B.V.

Business and Financial Review • Mar 10, 2022

National Storage Mechanism | Additional information

RNS Number : 2728E

Corre Energy B.V.

10 March 2022

10 March 2022

Corre Energy B.V.

("Corre Energy" or the "Company")

Operational Update

Corre Energy is a leader in the development, operation and commercialisation of Long Duration Energy Storage (LDES) projects and products that will accelerate decarbonisation and enhance security and flexibility of energy systems.

Our team has extensive experience and success in the energy sector - in renewables, energy storage and hydrogen, including market-leading expertise in modelling the capability of LDES to integrate large scale renewables.

Update Overview:

·    Demand for our unique Long Duration Energy Storage (LDES) solutions continues to experience heightened interest from a range of market parties and now Corre Energy will directly benefit from the EU's recently announced "REPowerEU" plan. Under this plan, renewable permitting will be accelerated and a hydrogen storage accelerator developed. This plan fully underpins strong offtake demand from investment grade utility customers and commodity trading houses for Corre Energy projects

·    Heightened geo-political risk, unprecedented electricity prices and highly volatile CO2 pricing all support the EU's recent announcements on "market actions" and "state aid." Corre Energy's ability to balance and secure energy supplies play directly into these measures. With two EU Projects of Common Interest (PCI's) in the Corre Energy portfolio, these recent announcements should increase the approval probability of our projects in The Netherlands and Denmark, with the associated benefits of probable improvements to subsidy schemes

·    As part of achieving financial close of the Zuidwending ZW1 project, Corre Energy has initiated a process of securing a long-term offtake agreement. There has been significant interest with several investment-grade entities submitting offers for long-term offtake of 10-15 years for 100% of the output of the project. The outcome of this process is expected in H1 2022. Key selling points of the ZW1 project are the storage duration of up to 84hrs (3.5 days) output capacity of 320MW to enable integration of gigawatt renewables and green hydrogen use

·    Overall market conditions are expected to trend favourably in the long term for storage valuations and consequently offtake contract negotiations. Consequently, the commercialisation program and associated milestones have been optimised to take advantage of this demand and to enhance economics. This is set against a backdrop of steady progress to date towards achievement of key operational milestones for both ZW1 and Green Hydrogen Hub Denmark (GHH)

·    The business continues to expand its interests and is in advanced negotiations regarding additional projects in Germany, UK and US. There is a high probability that an offtake agreement similar to the one being negotiated for ZW1 can be achieved for such projects. The expansion of our portfolio with increased customer demand means our unique LDES solution, which integrates large scale renewables and utilizes green hydrogen will deliver a long-term revenue stream which can be scaled across multiple markets

Key Statistics & Developments:

Listing Date: 23 September 2021
Listing Venue: Euronext Dublin
Ticker: CORRE
Share Price: €1.21 on 9 March 2022
Shares in Issue: 62,018,846
Market Capitalisation: €75mn
ISIN: NL0015000DY3

Partnerships:

·    Siemens Energy - project and technology collaboration MOU signed

·    LDES Council - Corre Energy is an anchor member of the global council

·    EASE - council member of European Association for Storage of Energy

·    DEEP.KBB - partnership agreement in place with this leading underground storage engineering specialist

·    Geostock - 10-year collaboration agreement in place

·    ECH2A - European Clean Hydrogen Alliance have highlighted ZW1 and GHH as key Energy Transition investment projects

Customers:

·    As part of Corre Energy's process of delivering an offtake agreement on ZW1, proposals for 10-15 year contracts have been received from a range of investment-grade partners

·    Increasing customer demand points to a scalable revenue contractual framework for pipeline project opportunities

·    Optimising commercialisation program and associated milestones to enhance offtake and project economics given customer demand

Finance:

·    Fondo Italiano per l'Efficienza Energetica  (FIEE)  drawdown - €11mln drawn by Q4 21

·    Infracapital - working in partnership to select senior debt provider

·    BEIS/NZIP (UK Gov. Business, Energy, & Industrial Strategy/Net Zero Innovation Portfolio) - grant of £150,000.00 awarded Q1 22

·    Project ZW1 - grant reclaim of €1.7mln to CINEA (European Climate, Infrastructure and Environment Executive Agency)

Key Appointments:

·    Representing Fondo Italiano per l'Efficienza Energetica (FIEE) Luca Moro has joined the board

·    Allan Ralston, Chief Projects Officer

·    Jens Gravgaard, Project Director Green Hydrogen Hub Denmark

·    Alistair Metcalfe leading Legal function

·    Stephanie Casey leading Investor Relations function

Projects:

ZW1 has achieved significant progress to date

Project Type	Hydrogen CAES
Location	Netherlands
CAES Capacity	Design improvements can yield up to 84hrs (3.5 days) output capacity of 320MW in contrast to previous 12hr duration design
CAES Generator	320 MW
Reserved	640 MW
Customer Offtake	Offers of 10-15yrs for 100% of output with revenue sharing

Milestones & Timeframes:

·    Customer contract and primary EPC framework - H2 22 to optimize pricing and contract terms

·    Key development milestones of design, land and grid reserved are on track for completion Q2 22

·    Strong customer demand is expected to continue into Q2 22 allowing for optimal offtake arrangements to be achieved with customers 

GHH is a world first and will act as the blueprint for remaining projects in the pipeline

Project Type	Green Hydrogen Hub
Location	Denmark
CAES Capacity	3 - 4 GWh Design optimization could achieve a 1-1.5 day duration of storage
CAES Generator	320 MW
H2 Capacity	250 GWh
Electrolyser Capacity	350 MW
Construction	2023

Milestones & Timeframes:

·    Whilst early stage we see significant emerging customer demand with three investment-grade entities currently engaging under a similar contractual model to ZW1

·    Final customer contracts for offtake to be targeted for completion Q4 22

·    Given emerging drivers for accelerating renewables and green hydrogen in Denmark, increasing customer demand is expected into H2 22

Contacts:

Stephanie Casey	Investor Relations
Email:	stephanie.casey@corre.energy
Mob:	+44 7587 748402

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