ATOME Energy PLC (AIM:ATOM) has received a cash injection of £2.4mln from US engineering giant Baker Hughes and also announced plans to pivot its Villeta green hydrogen plant in Paraguay to produce fertiliser.
Baker Hughes is taking a 6.6% stake in AIM-listed ATOME and will become its largest shareholder by purchasing 2.53mln new shares at 95p, a small premium to Friday’s close.
The Houston-based firm also has the option of first refusal to supply equipment to ATOME starting with Villeta.
Peter Levine, ATOME's chair, said: "Baker Hughes' reputation is to be at the forefront of the energy technology and the quality of its equipment is recognised globally.”
Levine added that ATOME had also decided to expand the Paraguay plant to add a fertiliser unit to the planned ammonia and hydrogen production.
Villeta will now produce up to 250,000 tonnes a year of calcium ammonium nitrate (CAN), a fertiliser widely used worldwide and often preferred to Urea due to its low carbon footprint.
ATOME will use the engineering contractors already developing the existing project, meaning there will be no change to the timeline of the engineering design and final investment decision.
Full-scale production is still expected in 2025 but will now be CAN, it said.
Olivier Mussat, chief executive, added: “Our new commercial division has seen significant incoming market demand which has underpinned our shift in strategic direction to incorporate a downstream proposition.
"There is a clear and compelling commercial rationale to harness our Villeta plant so that it produces green fertiliser.
"With the EU being the largest consumer of CAN in the world and the Mercosur region being the largest importer of CAN - all of which are currently derived from hydrocarbons - the market potential for 100% green CAN is vast.
"With key elements for Villeta already in place and no changes to our project timelines, the move to produce green fertiliser provides ATOME with the potential opportunity to deliver substantial, stable long-term returns.”