March 2017

Utah Ranked 11th in the World for Mining Investment

29 Mar 2017

Utah just missed the top 10 in the list of the world’s friendliest investment regions for mining in the annual Survey of Mining Companies 2016 by the Fraser Institute, coming in at number eleven (down from ninth last year).

 

Nevada and Arizona were the only U.S. states to make the top 10, ranking fourth and seventh, respectively.

 

The Fraser Institute’s survey canvassed the opinions of mining executives and managers worldwide on the policies and the mineral resources of 104 global jurisdictions.

Enefit´s affiliate company has achieved financial close for the USD 2.1 billion oil shale power project in Jordan

20 Mar 2017

Enefit´s affiliate company Attarat Power Company (APCO) announced that it has reached financial close for the USD 2.1 billion project to construct the first oil shale fired power station and open cast mine in Jordan. The construction of the 554MW gross/470MW net oil shale fired mine mouth power station will commence shortly and the power station is scheduled to start operation in mid-2020.

 

Investment value of the project is USD 2.1 billion, making this the largest externally financed project in Jordan and the largest single investment into oil shale. With financial close Enefit has completed the sell-down of its previous 65% shareholding in APCO to 10%. APCO is now owned 45% by YTL Power International of Malaysia, 45% by Guangdong Yudean Group Co. Limited of China and 10% by Enefit. The shareholders have committed to provide base shareholder funding of up to USD 528 million to fund the project.

The USD 1.582 billion debt financing will be provided on the basis of support by China Export & Credit Insurance Corporation (Sinosure). The lead is arranged by Industrial and Commercial Bank of China and Bank of China. China Construction Bank and China Exim will also participate in the facility.

 

Hando Sutter, Chairman of the Management Board of Enefit: “The Hashemite Kingdom of Jordan and Estonia are alike in many ways – we both have very few natural resources but an abundance of oil shale. Estonia has utilized oil shale for 100 years and we are proud that we have had the opportunity to help the Kingdom start utilizing its vast resource. Jordan imports over 95% of its energy needs. APCO´s power plant meeting 10-15% of the Kingdom´s rapidly increasing energy consumption will offer a much-needed solution for Jordan.”

 

Hando Sutter: “Achieving financial close for this strategic and unique project has required the dedication of many international parties for several years. Enefit would like to thank everyone who has believed in the success of this project, which has enabled Enefit to share its 100 years of experience with oil shale. We especially thank our partner Near East Investments and the Government of Jordan for inviting us to Jordan and YTL, Yudean and the Chinese lenders for investing in oil shale. With the expertise and advanced technology for both oil and power production it has developed over the years, Enefit is in a strong position to help advise and support other countries with large oil shale deposits who want to utilize those resources.”

 

APCO has entered into a fixed cost fixed term engineering, procurement and construction contract with Guangdong Power Engineering Corporation, a subsidiary of China Energy Engineering Group Co Ltd. Commercial operations of the two units are scheduled for 38 and 42 months from financial close. APCO has entered into a 30-year agreement with National Electric Power Corporation for the sale of the entire electrical capacity and net electrical output following construction of the power station. Affiliates of the shareholders will be responsible for the operation and maintenance of the power station as well as the fuel supply. The power station and oil shale mine are expected to employ approximately 5,500 people during construction and 1,000 during operations. The power plant has been designed to meet Jordanian regulations for solid fuel generation which are equivalent to or stricter than IFC Performance Standards and World Bank Health and Safety Guidelines.

 

In addition to developing an oil shale fired power plant in Jordan, Enefit has signed, through its 65% subsidiary Jordan Oil Shale Energy Co (JOSE), an Oil Shale Surface Retort Concession Agreement with the Government of Jordan, giving it exploration and production rights for 40 years for approximately 2.6 billion tonnes of geological oil shale resource.

 

Notes:

 

In 2013, Guangdong Power Engineering Corporation was selected to lead the engineering, procurement and construction (EPC) of the 554MW (gross) mine mouth oil shale fired power plant under a fixed price turnkey contract. Foster Wheeler will provide the circulating fluidised bed boiler island, Siemens on the steam turbine generator and Worley Parsons on the plant design. The plant will be based at the Attarat um Ghudran oil shale deposit approximately 100km south east of Amman.

 

Enefit is the world´s largest oil shale energy company. Its sole shareholder is the Republic of Estonia. Enefit owns and operates some 2,000MW of direct oil shale fired mine-mouth power generation capacity and supplies electricity to some 450,000 customers. Enefit is also one of the largest producers of shale oil in the world and has been engaged in oil shale processing for 80 years. Enefit has studied oil shale in 13 countries worldwide (in Jordan, US, China, Myanmar, Mongolia, Morocco, Serbia etc.), owns an oil shale project in Utah, USA, with an estimated of 2.6 billion barrels of recoverable oil, and owns a pilot plant for oil shale studies in Frankfurt, Germany. More than 1 billion tons of oil shale has been mined, over 200 million barrels of oil have been produced and more than 600TWh of electricity has been produced from oil shale in Estonia to date.

 

YTL Power International Berhad (YTLPI) is listed on Bursa Malaysia. YTLPI owns and operates some 5,500MW of gas, oil and coal-fired power generation plants in Malaysia, Singapore and Indonesia and is an active trader of oil products in the Singapore market where it has approximately 850,000m3 of storage capacity. YTLPI also owns 100% of Wessex Water Services Limited, a water and sewerage services company that serves the south west of England in the UK and a one-third stake in ElectraNet S.A. which owns and operates the electricity transmission network in South Australia.

 

Yudean, based in Guangdong Province, is a Chinese utility which is 76% owned by People’s Government of Guangdong Province and 24% owned by China Huaneng Group. As of the end of 2015, Yudean had total assets amounting to nearly 130 billion RMB, controllable installed capacity of 29,085.6MW, and controllable shipping capacity of 2.41 million DWT, and realized the annual operating revenue of 46.749 billion RMB. Also, Yudean wholly owned, controlled and participated in more than 157 organizations, and exercised control over listed company – Guangdong Electric Power Development Co., Ltd. Yudean’s core business involves coal-fired power, hydropower, natural gas power generation, wind power, nuclear power, photovoltaic power generation, etc., and diversified industries include mine, shipping, port, LNG terminal, equipment manufacture and finance etc., covering the whole Guangdong Province, and is actively extended to areas outside Guangdong Province and foreign countries.

 

#   #   #

 

Utah’s economy continues to lead the nation, benefiting EAO’s Utah Project

9 Mar 2017

Utah’s booming economy, positive business environment and prudent fiscal leadership continue to keep the state at or near the top of national “Best of…” lists. The state’s solid economic foundation and pro-business, pro-energy climate is a great benefit that supports and adds value to Enefit’s Utah Project.

 

Forbes magazine recently named Utah #1 for the third straight year in its annual “Best States for Business” report. Utah also took top honors between 2010 and 2012.

 

U.S. News & World Report magazine ranks Utah #1 for job growth.

 

In another recent report, U.S. News ranked Utah seventh overall in a comparison of the strengths of all 50 states in seven different areas – economy, infrastructure, opportunity, health care, education, crime and government. Utah scored particularly well in the areas of economy (high growth in jobs and GDP, pro-business environment), infrastructure (transportation, internet access, low energy costs), higher education (graduation rate, low student debt, low tuition and fees), government (fiscal stability, credit rating, e-government).

 

And, the University of Utah’s Kem C. Gardner Policy Institute finds that Utah’s economic prosperity will keep growing throughout 2017, with continued strong increases expect in employment, population, construction and other key sectors.

 

#   #   #

‘Reserve’ status increases value of Enefit’s oil shale holdings

8 Mar 2017

Enefit American Oil has secured what is believed to be the world’s first confirmed oil-shale-to-shale-oil Reserve classification, a third-party analysis confirming the Utah Project’s technical and economic feasibility, according to rigorous mining and petroleum industry reporting standards.

 

This is a major milestone that adds significant value to the Project. In addition to showing that the Project is technically and financially viable, it confirms there are nearly 520 million proven and probable barrels of shale oil on about 6,000 acres of our privately owned Enefit South property. That will support a production level of approximately 50,000 barrels of oil a day for more than 30 years.

 

“The Reserve finding – made by Millcreek Mining Group after more than six months of study – is a critical step along the development path for natural resources projects,” said Enefit’s Acting CEO Ryan Clerico. “It moves the Project up the value curve by converting from the less-certain designation of ‘Resource’ to a Reserve. It also shows financial institutions and potential investors that the Project has solid long-term value.”

 

Seeking outside investors has always been part of Enefit’s long-term strategy for the Utah Project, which will require several billion dollars to build. With a Reserve classification in hand, the company can begin that process; Enefit has successfully attracted investors for its oil shale project in the Middle Eastern country of Jordan and is looking forward to the opportunity of doing so in the U.S.

 

The Reserve statement demonstrates that the Utah Project’s business plan is sound and that using the commercially proven Enefit technology is feasible. The oil production technology has been used for more than 30 years at Enefit’s operations in its home country of Estonia; the Reserve finding shows, through test work and engineering, that it is compatible with Utah oil shale. While there are certainly differences between the Estonian and Utah shale – for instance, the Utah shale is much drier – the fundamental process can be adapted for the Project.

 

In total, Enefit’s holdings contain more than 3.5 billion barrels of in-place shale oil across 27,000 acres, nearly two-thirds of which is private land. The Project is in what’s considered a “sweet spot” in the Green River Formation, the world’s largest deposit of oil shale, centered at the junction of Utah, Wyoming and Colorado.