Clean TeQ Water Ltd (ASX:CNQ) has signed a partnership agreement with US-based Upwell Water LLC, a leading tech-enabled water resource and infrastructure company, to invest in water treatment plants and sell water treatment services under a build, own, operate and transfer (BOOT) delivery model.
The companies are targeting the deployment of US$150 million in new investment over four years for BOOT projects.
Under the partnership, Clean TeQ Water will take full responsibility for the design, installation and operation of water treatment plants and assets, with Upwell providing the necessary capital.
“Area of significant growth”
Clean TeQ CEO Willem Vriesendorp said: “We are delighted to start working with Upwell to offer water treatment services as an alternative to selling integrated equipment.
“We believe this model will be especially suitable for new, large-scale recycling plants where the ability to offer financing solutions through public-private partnerships is an area of significant growth.
“Clean TeQ Water looks forward to bringing some of its unique technologies to this growing market.”
Long-term revenue stream
Under the agreement, Upwell is provided exclusive rights of first refusal for BOOT projects that Clean TeQ Water pursues globally.
The detailed financial terms will be project specific and the result of negotiations with the end-user.
This agreement with Upwell provides Clean TeQ Water with the ability to offer a range of BOOT projects and services through this partnership.
It will enhance the company’s future growth by attracting customers that are capital constrained such as municipalities, and customers that lack the appetite to manage and own water treatment assets.
Moreover, BOOT will provide Clean TeQ Water with a long-term revenue stream from ongoing operations, maintenance, and consumables sales, as well as a share in the return on the capital invested in projects.