Renewable Energy in South East Europe. Hydro & Geothermal Energy

Transcription

1 Renewable Energy in South East Europe Hydro & Geothermal Energy November 2013

2 Forward Looking Statements This presentation contains forward-looking statements and factual information that are current as of the date the presentation was originally delivered. Reservoir Capital Corp., and its subsidiaries disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Forward-looking statements include, but are not limited to, statements with respect to the timing and amount of estimated future development activities, expenditures, permitting, and requirements for additional capital and access to data. Forward looking statements involve known and unknown risks, uncertainties, and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward looking statements. Such factors include, among others, risks related to actual results of project development activities; changes in project parameters as plans continue to be refined; the ability to enter into joint ventures or to acquire or dispose of projects; future prices of electricity; accidents, labor disputes and other risks of the power industry; ability to obtain financing; and delays in obtaining governmental approvals of financing. 2

3 Company Overview Reservoir Capital is a renewable energy company with over 80 MW of hydroelectric (HPP) and geothermal projects (GPP) under development in Serbia, Bosnia and Montenegro The 59.1 MW Brodarevo HPP in Serbia has a positive feasibility study (completed in June 2012) and is close to being fully permitted to start construction In February 2013 Reservoir was granted a Concession for the MW Cehotina HPP in Bosnia Vranjska Banja GPP in Serbia has a tested 5 MW geothermal resource and potential for MW 3

4 Hydro Power & Europe Clean and renewable, consumes no raw materials High capacity factors (45-55%) compared to wind and solar (20-30%) A safe and proven technology in use for over a century Improves grid stability because of its flexibility and predictability The EU has mandated that 20% of its power will be renewable by 2020 Southeastern Europe has the only significant undeveloped hydropower potential Geographical location of the Balkans at the crossroads between east and west 4

5 Projects Overview Project Type MW GWh Status Brodarevo HPP Feasibility Cehotina HPP Concession Vranjska Banja GPP 5.0 Resource HPP Hydro Power Plant GPP Geothermal Power Plant 5

6 Hydro Projects Location Cehotina river HPP Brodarevo 2 HPP Brodarevo 1 Lim river 6

7 Brodarevo Run-of-River Hydro Projects - Serbia Two Hydro Projects on the river Lim 59.1 MW total capacity Estimated capital investment 146 million Feasibility studies completed in June 2012 Feed-in Tariff agreed under Serbia-Italy Bilateral Agreement of 155/MWh Power Purchase Agreement in place with GdF Suez Project permitting approaching completion 7

8 Brodarevo Projects - Overview Project MW Flow (m 3 /s) Head (m) Capacity factor GWh/year Capex Brodarevo % M Brodarevo % M 8

9 Brodarevo Projects Capital Costs Project Civil Works ( 000) Hydromechanical Equipment ( 000) Mechanical Equipment ( 000) Electrical Equipment ( 000) Prime Costs ( 000) Working Capital ( 000) Total ( 000) B1 19,134 5,184 8,151 12,250 26, ,787 B2 23,806 4,911 8,787 11,813 23, ,043 Total 42,940 10,095 16,938 24,063 50,351 1, ,830 % of Total 29% 7% 12% 17% 35% 1% 100% Note: Capital expenditure estimates include contingencies of 8% on the civil works, 5% on equipment and roads and 15% on the construction of the road tunnels 9

10 Brodarevo Projects Capital Costs Type of Works 1 st Year ( 000) 2 nd Year ( 000) 3 rd Year ( 000) 4 th Year ( 000) Total ( 000) Civil Works 10,398 14,422 14,284 3,835 42,939 Equipment 10,339 14,684 14,272 8,801 51,096 Prime Costs 44,385 2,082 2,131 1,753 50,351 Working Capital ,444 Total 65,122 31,188 34,420 15, ,830 % of Total 45% 21% 24% 10% 100% Note: Anticipated construction time for Brodarevo 1 is 4 years, and Brodarevo 2 is 3 years. 10

11 Brodarevo Projects Financial Analysis Unlevered After-Tax Financial Metric Brodarevo 1 Brodarevo 2 Combined Internal Rate of Return 13.14% 16.79% 15.07% Net Present 8% ( 000) 34,507 63,869 98,657 Net Present 10% ( 000) 17,411 41,215 58,797 Leveraged After-Tax Financial Metric IRR 8% ( 000) 10% ( 000) Combined 24.04% 101,202 71,725 Note: Assumption is debt will have a 15-year term from initial drawdown and be subject to an annual interest rate of 6.5%. 11

12 Brodarevo Projects 3D View Brodarevo 1 dam location dam location Brodarevo 2 12

13 Brodarevo Project - Advantages Brodarevo is a run-of-river project, with minimal social and environmental impacts, that will generate clean energy and promote sport and tourism in the Lim valley. The projected 146m capital investment goes to one of the poorest regions of Serbia, with the majority spent with local contractors, creating ~1,000 jobs during the 5-year constructions period. Approximately one third of the investment will be spent on land purchases, new roads and new transmission lines that will be government owned. The infrastructure works include 7.5 km of new public roads and tunnels that will shorten the M-21 by 2km and improve its safety. Project will generate electricity and tax revenues on a long-term basis. 13

14 Cehotina Run-of-River Hydro Projects - Bosnia 3 smaller hydro projects on the river Cehotina Minimum impact on the environment 30-year concessions granted in February MW total capacity planned Estimated Total Production of 70 GWh/year Preliminary Capital Cost Estimates ~ 45m Feasibility Studies starting in

15 Cehotina Projects Sites - Overview Project MW Flow (m 3 /s) Head (m) GWh/year Luke Falovici Godijeno

16 Cehotina Projects - Configuration HPP Godijeno HPP Luke 1. HPP GODIJENO RESERVOIR 2. HPP FALOVICI RESERVOIR 3. HPP LUKE RESERVOIR 4. HPP FALOVICI DERIVATIVE FACILITY 5. ROAD FOCA GODIJENO CAJNICE 6. LOCAL ROADS 7. ROAD FOCA PLJEVLJA 8. STATE BORDER BOSNIA - MONTENEGRO HPP Falovici HPP Luke HPP Falovici 16

17 Electricity Transmission to Italy Italy is fulfilling part of its EU renewable energy obligations by importing it from the Balkans via new subsea cables. The Pescara-Tivat subsea link to be used for Reservoir s projects is already under construction. 17

18 Management Miles Thompson, Executive Chairman ex-gold Fields, +25 years natural resource project management in oil & gas, mining and renewable energy in emerging markets. Miljana Vidovic, President & CEO ex-manager Business Development for Tractebel Engineering (GDF Suez Group) in Southeast Europe. Chris MacIntyre, Vice-President, Corporate Development ex-unx Energy Corp., VP Corporate Development at Reservoir Minerals Inc. and Lara Exploration Ltd. Milan Cusic, Deputy Director REV Serbia engineer with +15 years with Serbian State Utility, most recently as Chief Hydro Engineer. Responsible for the Company s hydro projects. Aleksandar Obrenovic, Director SEE Serbia geologist with +20 years experience in natural resource sector, ex-geological Survey. Responsible for the Company s geothermal projects. Christina Cepeliauskas (CFO) Certified General Accountant with more than 15 years of financial accounting and treasury experience in the mineral exploration and mining industry. CFO of Eurasian Minerals Inc. and Reservoir Capital Corp. 18

19 Independent Directors Lewis Reford, Lead Director ex-head JP Morgan Resource Banking, Director of several renewable energy companies. Mike Brown, Director ex-development Manager Pacific Hydro, developed 600MW in Chile. Winston Bennett, Director VP Helios Energy Inc. a developer of large-scale solar energy based systems, and formerly VP Investment Banking Cormark Securities. Patrick Eve, Director Managing Director of TranslateMedia, a language services provider, cofounded and was Chief Operating Officer of ITC Ventures, an active Venture Capital Fund. Michael Winn, Director - 25 years in the natural resource sector and public markets. Director and founder of several junior natural resource companies. 19

20 Capital Structure Issued Shares Options 84.3 M 5.3 M Warrants 37.4M Fully Diluted Shares M 20