Green Impact Partners ("GIP" or the "Company") is pleased to provide an update on its flagship project, the Future Energy Park ("FEP'), and announces its third quarter results for 2024.
Future Energy Park
In July 2024, the Company finalized the pathways to solidify eligibility for environmental credits under the Alberta Technology Innovation and Emissions Reduction ("TIER") program for FEP. In addition, as part of ongoing development activities, GIP reached commercial agreement on key terms to sequester the biogenic CO2 from the facility. These were both critical path items within the project schedule.
"While delays related to the Alberta TIER program and sequestration agreements in 2024 impacted the timeline, we based our initial project schedule and guidance on feedback from relevant stakeholders," said Jesse Douglas, Chief Executive Officer. "Given the innovative nature of the FEP project and with this process now behind us, we have a clear path forward. Our focus is on executing remaining commercial and debt processes, positioning us to make our final investment decision in early 2025."
GIP has completed the Engineering, Procurement and Construction ("EP&C") contracts and schedule for FEP. Due to the project's scale and inflationary pressures, updated EP&C costs for FEP are estimated at approximately $1.5 billion. To manage risks and costs effectively, GIP has strategically formed a consortium for the EP&C, dividing the work into two contracts (one for Engineering and Procurement and another for Construction), and continuing to fully wrap the construction, design and performance of the facility. This approach aligns with the Company's commitment to maximize project efficiency and accountability. Additionally, GIP expects to finance FEP with 25% equity and 75% project-level senior and subordinated debt.
The facility's estimated annual production includes four million gigajoules of RNG, over 300 million litres of cellulosic equivalent ethanol, approximately 595,000 tonnes of wet distillers' grain, approximately 650,000 tonnes of carbon credits, and approximately 300,000 tonnes of clean, biogenic CO2. Based on updated contract terms and independent third-party price forecasts for FEP's various revenue streams, the estimated annual, full run-rate EBITDA1 is expected to range between $370 million and $490 million.
FEP remains on track to proceed to the start of full construction in 2025. The project is expected to require approximately three years for construction and full commissioning, with revenue ramping through the commissioning period.
GIP Welcomes New Board Member
In November 2024, GIP welcomed David Spivak to its Board of Directors. With 30 years of experience in capital markets and corporate finance, David has built a distinguished career as an investment banker, capital markets advisor, and Chief Financial Officer for both private and public companies.
David is President of Brockstreet Capital, an investment and corporate finance advisory firm. He previously served as Group Chief Financial Officer and Senior Vice President, Corporate Development at Persis Holdings Ltd., a private investment firm based in Vancouver, Canada. David was also Chief Financial Officer of Seaspan Corporation, the world's largest containership lessor. During his tenure at Citigroup, David held numerous roles, including Managing Director in Investment Banking and US Equity Capital Markets, Canadian Head of Global Capital Structuring, and Chief Operating Officer of Citigroup Global Markets Canada. David has deep expertise in structured corporate finance and capital markets and has been recognized as a TopGun Banker for US Equity Capital Markets by Brendan Wood International. David currently serves on the boards of Höegh LNG Partners LP and Accord Financial Corp.
Revenue: Revenue decreased by $12.6 million and $15.7 million for the three- and nine-month periods ended September 30, 2024, respectively, compared to the same periods in 2023. The decrease was primarily due to the lower volumes and reduced underlying market prices for the energy products optimized and sold.
Adjusted EBITDA: Adjusted EBITDA decreased by $2.0 million and $1.6 million for the three- and nine- month periods ended September 30, 2024, respectively, compared to the same periods in 2023, mainly due to losses realized for the investment in the Colorado Joint Venture and higher salaries and wages. In addition, Adjusted EBITDA for the nine months ended September 30, 2024 was negatively impacted by the well workover at the Company's Grande Cache facility.
For a more detailed discussion on GIP's results for the three and nine months ended September 30, 2024, please see the Company's financial statements and management's discussion & analysis ("MD&A"), which are available at: https://www.greenipi.com/investors/ and on the Company's SEDAR+ page at www.sedarplus.ca.
