Norsk Hydro ASA

Norsk Hydro: Voluntary termination of power purchase agreement with Cloud Snurran AB

Hydro has agreed to a settlement for the long-term power purchase agreement

(PPA) with Cloud Snurran AB. In the settlement, Hydro is entitled to

compensation of up to EUR 90 million for its voluntary termination of the PPA.

Hydro Energi AS signed a long-term PPA with Cloud Snurran AB in 2018 for an

annual baseload supply of 300 GWh in the period 2020-2030, and 550 GWh in the

period 2031-2049. Cloud Snurran AB has experienced financial challenges for the

last few years and has as a result not delivered volumes to Hydro in accordance

with the PPA since November 2024.

On July 17, 2024, the Svea Court of Appeal approved Cloud Snurran AB's

application for reorganization under the Swedish Restructuring Act, overturning

an earlier decision by the Stockholm District Court. The reorganization process

has now been terminated, and as part of a final settlement, Hydro has agreed to

a voluntary termination of the PPA against a compensation of up to EUR 90

million, which includes compensation for non-delivered volumes and future power

deliveries. Hydro's ultimate compensation will depend on the realized values

from a future sales process and an agreed value sharing mechanism.

The sourcing situation at Hydro's Norwegian smelters remains robust through

2030, based on an average annual equity hydropower production of 9.4 TWh and a

contract portfolio of around 8.5 TWh per year. As several existing long-term

power agreements will begin to expire at the end of 2030, Hydro is actively

pursuing a range of available sourcing options to meet the demand for cost-

competitive renewable power to its operations.

Subject to fulfillment of certain closing requirements, the settlement is

expected to become effective during July 2025.

Investor contact:

Mathias Gautier

+47 94861597

Media contact:

Anders Vindegg

+47 93864271

AI Terminal