IGas buys 14 MW geothermal project in Etruria Valley

IGas Energy has entered into a share purchase agreement (SPA) to acquire GT Energy UK Limited, a developer of deep geothermal heat projects onshore in the UK.

GT Energy’s principal project is a 14 MW deep geothermal project in the Etruria Valley, Stoke-on-Trent. The project is anticipated to supply zero carbon heat to the city of Stoke-on-Trent on a long-term ‘take or pay’ contract (TPA) with Stoke-on-Trent City Council (SoTCC). It is anticipated that the heat will be supplied through the SoTCC owned and operated district heating network, which is undergoing installation.

All the geophysical work on the project is complete and the necessary permitting in place. Planning was granted historically for the project and needs to be renewed. Under the current timetable it is anticipated that drilling and testing could commence in Q2/Q3 2021 with the installation operational by March 2022.

Under the terms of the SPA, IGas will make an initial payment of GBP500,000 (US$643,190) to the Sellers to be satisfied in 2,222,223 IGas ordinary shares on completion. The initial purchase price will be subject to post-completion adjustment following the preparation of completion accounts, with any positive or negative adjustment being made against any additional consideration upon satisfaction of future milestone events.

The maximum consideration payable to the sellers under the SPA is GBP12 million (US$15.4 million).

The key sellers of GT Energy holding in excess of 10% are AURUM (Development) Nominees Ireland Limited; Vivienne Keane; Low Carbon Innovation Fund and Padraig Hanly.