Oracle Power Plc / EPIC: ORCP / Market: AIM / Sector: Mining
03 April 2020
Oracle Power PLC
("Oracle", the "Company" or the "Group")
Q1 2020 Update from the CEO
Further to the Company's announcement earlier today, Oracle is pleased to provide the following update statement from its CEO, Naheed Memon, with respect to developments since the start of 2020:
"The Coronavirus (COVID-19) and ensuing pandemic have dominated headlines and corporate strategies for much of Q1. With that in mind, it would be understandable for some to conclude that many companies have not had the opportunity to further their own commercial or operational objectives and that progress has been, by and large, stymied. I am pleased to say that this has not been the case with Oracle and the period under review has, in fact, been a very constructive phase for your company and one which has delivered several material developments. Whilst we are cognisant of the global economic uncertainty and political nervousness surrounding the pandemic, the Board of Oracle is progressing the work and discussions conducted in recent months and is confident that there will be no significant adverse impact on the timelines to the development of Thar Block VI.
"Reflecting on the past three months, a major milestone was achieved through the signing of a Consortium Agreement (RNS: 19 February 2020) with our partners on the Thar Block VI Project: China National Coal Development Company Ltd. and the private office of His Highness Sheikh Ahmed Bin Dalmook Juma Al Maktoum ("HH Private Office"). The purpose of this consortium is to develop a lignite coal mine, a 1,320MW mine mouth power plant and a coal-to-gas liquid facility in Block VI of the Thar desert in the Sindh Province, Pakistan.
"The strategic importance of an integrated mine, power and coal-to-gas and liquid project in our region of focus cannot be overstated. There is a huge inherent demand in Pakistan for cheaper energy which can be generated domestically to mitigate the current reliance on imports, which significantly impacts the economy and can create inflationary pressure. In addition, the potential of coal gasification into fertiliser projects and coal to liquids is paramount to addressing food security issues and reduce fuel imports into Pakistan. On an international level the significance of our project, which has the potential to unlock the value of 1.4 billion tonnes of coal, has been clearly evidenced through the award of priority status within the China-Pakistan Economic Corridor ("CPEC") initiative. Oracle believes Thar Block VI is now the only project in Thar supported by CPEC for both power generation and gasification.
"There has been a clear willingness to accelerate the development of CPEC mega projects in Sindh. This was most recently demonstrated at a meeting held on 21 February 2020 between the Chief Minister of the Government of Sindh and the Chairman of CPEC Authority. The meeting included discussions regarding Oracle's Thar Block VI Project in addition to the proposed development of a 105km railway to support the regional transport of coal from the Thar coalfields, opening up additional potential customers across Pakistan and complementing Oracle's proposed mine mouth power plant.
"Following the signing of the Consortium Agreement in February 2020; in the third week of March Oracle and its partners submitted the Letter of Intent ("LOI") application to the Private Power and Infrastructure Board. The LOI approval, being the intent to purchase power granted by the Pakistani Government, is the next major step required in developing Thar Block VI. It will then provide Oracle and its partners with the ability to proceed to financial close. In the context of the COVID-19 pandemic, it is prudent to expect possible delays. However, we are hopeful that the process will be completed before the next Joint Coordination Committee meeting which is expected by the middle of this year or earlier. In the meantime, Oracle and its partners are continuing to work towards finalising the Joint Investment Agreement and Shareholders Agreement.
"Looking now to our corporate activity during the period; warrants to subscribe for a total of 113,562,792 ordinary shares were exercised which we believe not only demonstrated the continuing support from our shareholders, but also boosted Oracle's cash resources by a further £415,311. We also agreed a voluntary 12 month Lock-In Agreement with His Highness and HH Private Office, whereby HH Private Office agreed not to sell, transfer or otherwise dispose of the rights to any of the 200,000,000 ordinary shares that it holds or any ordinary shares he may acquire on market or pursuant to the exercise of warrants during the 12 month period - highlighting his long term view and support towards Oracle.
"We were delighted to appoint Glen Lewis to the Board as a non-executive director in March. Glen has an impressive background in the coal industry spanning some 30 years and I am confident that his knowledge and extensive network of relationships will be invaluable as the Company advances the development of Thar Block VI."
As previously announced, in conjunction with the issue of this update, Naheed Memon, CEO of Oracle, will also make herself available for a Q&A session via conference call at 10.15 a.m. (BST) on Tuesday 7 April 2020.
To participate in this conference call:
Please dial 0808 109 0701, or +44 (0) 20 3003 2701 if you are calling from outside of the UK,
enter participant pin 7158255# when prompted to do so.
Please note that all lines will be muted except for Ms Memon's. The Company invites shareholders to submit questions to its public relations adviser, St Brides Partners Ltd, ahead of the call via email to [email protected]. The deadline for submission of questions will be Monday 6 April 2020, 3.p.m.
Ms Memon will strive to answer as many questions as possible during the call. A recording of the call will also be made available on the Company's website.
If you have any problems accessing the call, please contact St Brides Partners Ltd on [email protected] or call +44 (0) 20 7236 1177.
For further information:
Oracle Power PLC
+44 (0) 203 580 4314
Strand Hanson Limited (Nominated Adviser)
Rory Murphy, James Harris, Jack Botros
+44 (0) 20 7409 3494
Brandon Hill Capital Limited (Joint Broker)
+44 (0) 203 463 5000
Shard Capital (Joint Broker)
St Brides Partners Limited (Financial PR)
+44 (0) 20 7186 9952
+44 (0) 20 7236 1177