JSE-listed Kibo Energy's UK subsidiary, Mast Energy Developments, has drawn down a the second tranche of funds advanced by River Fort for its Pyebridge project in Derbyshire as it looks for additional capex for its other power generation sites.
This comes as Mast Energy CEO Pieter Krügel, had said earlier this month that the kick-starting of work on the second phase of the Pyebridge project was set to boost the company’s revenues and profitability.
The Kibo Energy subsidiary said yesterday that the “second advance from RiverFort under the funding agreement” between the two parties had now been released.
Mast said earlier that the second advance was worth a gross total of £1 177 107.
The funds have since been channelled for associated payments to Cooper Östlund, the UK contractor carrying out the full long-block overhaul of one genset, which comprises of a engine and power generator.
“The replacement genset has been shipped from the supplier, PowerUp in Austria, and is expected to arrive on site shortly. The necessary preparatory works on site to replace the existing genset with the refurbished unit are well advanced and on track,” Mast Energy said.
Funds under the second advance are also expected to translate to a significant increase in additional revenue from the Pyebridge site sooner than expected.
As the Pyebridge genset gets overhauled, two other gensets on the site have remained operational and continue to generate revenue.
Krügel said the company was now, “looking forward to completing the overhaul work within the expected timeline, and to move forward with the overhaul of the remaining” two gensets at Pyebridge.
The Pyebridge site nonetheless was continuing to receive income from a capacity market contract with the UK government.
On completion of the overhaul of the first genset, Pyebridge will have three gensets operating and generating at optimum capacity, the company said.
Mast Energy is, however, exploring avenues for further capital expenditure to fund its other power generation projects that are under development or ready for construction.
“We are actively progressing discussions with various interested funders regarding the capex funding of MED’s construction-ready sites, in order to get each project into production and revenue generation as quickly as possible,” Krugel said.
Mast Energy noted that the “progress of construction and commercial operations” for the company’s projects was “subject to securing project capex” funding.
Some banks had shown interest in availing funding for the projects.
“In order to address this key next step in respect of these projects' development lifecycle i.e. to get each project into production and generating revenue, Mast Energy is actively progressing discussions with various potential debt and equity funders,” the company said.
“These discussions include banking institutions that have shown interest in providing funding.”
Mast Energy had also entered into a partial settlement deed with RiverFort Global Opportunities in relation to the re-profiled balance due under a prior agreement.
Under terms of the settlement, Krügel, who is a director of the company will purchase from Riverfort up to £325 000 of the re-profiled balance due.
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