Genex Power Limited has signed a new Memorandum of Understanding (MOU) with Electric Power Development Co Ltd trading as J-Power that could see the latter take shares in the Kidston pumped storage hydro project (K2-Hydro).
The MOU provides that the parties work together to negotiate a transaction for K2-Hydro for J-Power to acquire direct or indirect equity in the Project by way of: a subscription for new ordinary shares in Genex on terms equivalent or similar to the Share Subscription Agreement (SSA) signed between the parties and announced to the ASX on 6 June 2019; and/or a subscription for new equity securities directly in the Project Special Purpose Corporation (SPC);
Under the MOU J-Power will have the option to provide certain professional technical advisory services to Genex in relation to the construction phase of K2-
Hydro; and, subject to approval of the Project financiers and Project EPC contractor, provide O&M Services to the Project SPC.
“We are delighted that J-Power has shown faith in Genex and our K2-Hydro project with the execution of this MOU and to continue discussions along the lines of those originally announced in June this year,” said James Harding, CEO of Genex. “Genex strongly values the relationship that it has developed with the J-POWER team over the course of 2019 and we are excited that this will continue. We will work as quickly as we can to conclude arrangements with J-POWER as part of the restructuring of the K2-Hydro transaction with a view to reaching financial close for the project as soon as possible in 2020. Along with the decision by the NAIF Board to extend the offer of funding for K2-Hydro announced last week, we are maintaining the momentum we had previously established into the new year.”