EDP Renewables has presented a non-binding proposal to acquire Pilot Energy’s 367MW solar development at Three Springs, which is intended to facilitate the production of low carbon ammonia through the Mid West Clean Energy Project (MWCEP).
This offer is contingent upon meeting various conditions, and Pilot Energy expects the transaction to be finalised before the end of 2024. The main points of the offer include:
- Acquisition price of $11.5 million, subject to final adjustments post-due diligence and formalised in the asset sale agreement, to be paid in multiple stages.
- Conditions for the completion include:
- Signing a definitive asset sale agreement.
- Successful completion of due diligence.
- Internal approval from the buyer.
- Foreign Investment Review Board (FIRB) approval if necessary.
Pilot Energy shared that alongside advancing the Three Springs initiative, it has explored several alternative renewable energy locations to complement the low carbon ammonia production. The firm noted that its recently concluded MWCEP Pre-FEED study has validated the idea that combining carbon storage at Cliff Head with the region’s renewable energy assets could lead to industry-leading low carbon intensity ammonia.
Progress on Renewable Energy Initiatives
Additionally, the MWCEP project team from Pilot Energy has discovered potential opportunities to harness renewable generation closer to the location earmarked for the ammonia project. The company has indicated that selling the Three Springs project would enable them to reallocate funds to these newly identified sites, thus continuing their advancement of the MWCEP.
Chairman’s Remarks on the Sale
Brad Lingo, Chairman of Pilot Energy, remarked, “The proposed sale is a fantastic outcome for Pilot Energy, providing significant capital that will aid in progressing the Cliff Head Carbon Storage Project and the acquisition of the Cliff Head JV interests. This will also expedite the development of renewable energy sources in the mid-west to support the MWCEP.”