Andalas creditor agrees to extend maturity of debt note
Tuesday, August 1 2017 - 12:46 AM WIB
British energy company Andalas Energy and Power plc said that its creditor, Sandabel Capital L.P., has agreed to extend the maturity of zero coupon loan note worth 500,000 pounds to August 31, 2017.
The fee associated with the extension is ?50,000, which will be repaid alongside the ?550,000 loan note on or before the maturity date. The loan note only becomes convertible into equity in the event that the loan note is not repaid by the maturity date,? Andalas said in a statement on Monday.
The company said all other terms of the loan note (announced on February 1, 2017) remain unchanged. In addition Sandabel has been issued with 150,000,000 3-year warrants at a strike price of 0.1pence per share, representing a 38 percent premium to the closing share price.
Andalas is looking to develop a portfolio of 250MW to 500MW of wellhead independent power projects (IPPs) in Indonesia fired with gas from proven fields.
On September 1, 2016, Andalas announced a cooperation agreement with Indonesia?s state-owned oil and gas firm PT Pertamina to commercialize gas fields within Pertamina?s acreage in Sumatra via the roll-out of the company?s gas to power offering. Since then a number of projects have been subjected to a vigorous selection, due diligence and evaluation exercise, resulting in the identification of multiple proven fields within Pertamina?s portfolio that are suitable for gas-to-power development.
?Andalas and Pertamina are now seeking to formalize the contractual framework under which each proposed project can be developed, including specifics of the power project development and the terms of the agreement,? Andalas said.
On July 17, 2017, Andalas announced an agreement with PPE, the Indonesian state-owned construction and engineering company, to jointly develop independent power facilities in Indonesia. Andalas agreed to propose at least three projects to PPE within three months of the agreement. ?The company is pleased to report that it has now presented the first project and both parties have started the work necessary to evaluate the project and, subject to negotiation, to establish a consortium agreement to develop the project,? Andalas said.
In the recently announced 2017-2026 electricity procurement business plan (or RUPTL) of Indonesia?s state-owned electricity firm PT PLN, it was announced that mobile power plants are to be deployed to deal with short-term shortages of power. In response to this and in parallel with its core business of developing 30MW to 100MW independent power projects, Andalas said it has identified a number of gas projects as part of its work with Pertamina and other gas owners, that it considers to be potential candidates to supply a short term mobile power plant development.
Three categories of gas field are being targeted:
- Smaller projects (circa 30BCF) that are considered too small for a long term IPP development but are suitable for a shorter project life
- Producing gas fields with surplus uncontracted gas supply
- Oil fields where oil production is constrained by flaring consents.
Andalas has started project feasibility work on two gas assets. If found suitable, Andalas will look to propose a short-term power solution to the state-owned electricity company, PLN. The potential projects must be near existing gas supply and power infrastructure, located in a region with unmet power demand and offer immediate cash flow potential. Andalas will act as project developer and it has held conversations with a number of global flexible power providers to provide the power plant, operating and maintenance of any project under a tolling agreement.
Editing by Reiner Simanjuntak