Atome, President Energy’s hydrogen and ammonia production company, has announced yet another significant new development.
Atome has purchased a 75% stake in HCO, a green hydrogen and ammonia company situated in Northern Europe, for a minimal share price. Atome’s strategic ambition to be a player in the European market for green hydrogen and ammonia supply is reflected in this acquisition. Despite the fact that HCO currently has no real assets, it has experienced local management and a respected CEO in the country where the company is based.
For the generation of green hydrogen and ammonia, HCO is now in talks with the appropriate national power company as well as a recognized world leader in original equipment manufacturing.
HCO is optimistic that an appropriate power purchase agreement (“PPA”) can be reached to advance a necessary pilot program for hydrogen production in the relevant country, which is expected to begin in, at, or around the end of 2023, with a target second phase industrial production of 80,000 metric tons (“MT”) of ammonia around the middle of 2024.
With the announcement of the Americas Project on July 1, 2021, Atome now has two independent domains of interest, both of which have the potential to generate over 250,000MT of green ammonia per year by the end of the decade assuming they both progress to an industrial production level.
Atome will be responsible for providing a line of credit of up to US$20 million to fund the pilot program, which is currently estimated to cost US$12 million, and, if the pilot program is successful, Atome will lead the funding mobilization for the industrial production phase, all of which is contingent on a satisfactory PPA and equipment supply agreement, among other things. This is Atome’s second concrete step in achieving its stated commercial goals, and it adds a diverse geographic focus to its first portfolio.
Atome, a hydrogen and ammonia company in which President owns an 85 percent stake, has bought a 75 percent stake in a green hydrogen and ammonia company situated in Northern Europe for a small fee (“HCO”).
As part of President’s strategic aim in being active in the European market in addition to its Americas-centric Project, the acquisition allows Atome to offer green hydrogen and ammonia to European markets.
While the identity of HCO and the country in which it is located must remain confidential for commercial reasons at this time, the existing and local, experienced management with a reputable CEO who retains 25% of the company is in the process of detailed discussions with both the relevant country’s national provider of green renewable energy and one of the world’s leading original equipment manufacturers.
The goal of HCO is to become the relevant country’s first and leading industrial scale hydrogen and ammonia producer using the green renewable energy produced there, followed by export and worldwide sale and distribution of the products, using the international expertise, financial support, and footprint of President and its leading shareholders.
Atome’s admission into HCO offers that firm with immediate in-depth experience in project management, planning, and execution, all of which is required by the project’s prospective stakeholders, who include power and equipment suppliers, among others.
HCO’s current business plan calls for a two-phased production approach. The first phase is the completion of a proof of concept pilot (demonstration) program, which is expected to cost around $12 million and produce 500 tons of ammonia per year by 2023, and the second phase is an industrial roll-out using up to 75 MW with the goal of producing 230 tons of ammonia (NH3) per day (or 80,000 tons per year) by 2025.
Atome has agreed to provide a line of credit of up to US$20 million to fund the first pilot phase of the project and a further line of credit of US$20 million to fund the second phase of the project, subject to the pilot program being successful and Atome leading and mobilizing the financial package for that phase. The pilot program is expected to be finished by the end of 2023, with the second phase of industrial production set for the middle of the decade.
Following pre-contract discussions with HCO’s current management, President and Atome are optimistic that a fit-for-purpose PPA can be reached to facilitate the successful completion of HCO’s first phase pilot program and lay the groundwork for extending arrangements to allow the second phase of industrial production to begin.
This is Atome’s second formal agreement, and it broadens the company’s geographic focus to create a more balanced and reliable portfolio. As a result, Atome now oversees two projects, both of which have the potential to generate over 250,000MT of ammonia per year by the end of the decade if they continue to the industrial production stage.
Both Projects are still in the works, as is Atome’s stock listing on the London Stock Exchange’s standard list, which is expected to happen later this year.
Peter Levine, Chairman, commented “The announcement today further reinforces the determination of President’s subsidiary, Atome, to fulfil its strategic objective to geographically expand its green hydrogen and ammonia portfolio to the important European market ahead of the targeted listing of Atome’s shares on the London Stock Exchange later in the year. “Although at an early stage, discussions are underway in relation to both the purchasing of power and the sourcing of relevant hardware. “This latest development underlines the present and potential future material shareholder value in Atome which we expect the projected forthcoming flotation to realise and unlock for President’s own shareholders as well as providing those coming in on the listing with significant upside in a sector of increasing importance in the drive towards a carbon neutral future.”