PRESS RELEASE
Jakarta, 13th April 2016
VELCAN S.A. ANNOUNCES ADDITIONAL DELAY ON MEUREUBO 2 HYDROPOWER PROJECT IN INDONESIA
Following the announcement made on the 23rd of February, Velcan announces that the various parties involved in the tender and PPA negotiation of the Meureubo 2 project have not reached an agreement in the current RFP ("Request For Proposal") Process which was launched by PLN on October 22nd, 2015.
As per the regulation, this RFP process has now been cancelled and closed.
Velcan will now reengage with the parties involved to try to find a way to restart the procurement process and PPA negotiation. Administratively speaking this has to go through the complete re-initialisation of a new RFP process, which is a lengthy procedure.
As of today the Group is not able to give an indicative timeline for this new process.
The Group is still of the opinion that Meureubo is an excellent project technically speaking and which can produce electricity at a competitive rate during and after the concession period, for the population of the Aceh Province.
The Group wishes to thank both PLN and PJB, its 100% subsidiary, which is the consortium partner of Velcan in the project for the time and effort that has been put in trying to find a solution acceptable to all parties.
Hydropower concessions provide long periods of cash generation. In the case of Meureubo the concession duration is 30 years after the start of electricity generation. It is therefore not surprising that the negotiation of such contracts goes through ups and downs.
The Group will keep the market informed whenever new information is available on this project.
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Investor Relations Contact investor@velcan.lu
About Velcan:
Velcan develops and operates hydro power concessions in emerging markets with untapped potential. Hydro power can be an important contributor to the economic development of these countries. The Company's strategy is to become a market leader in hydro power concessions up to 200 MW. It is currently targeting India, Brazil and Indonesia for its investments.
As of April 2016, Velcan:
- Has built and operates its first hydroelectric concession in Brazil (15 MW),
- Owns rights related to hydroelectric concessions projects amounting to 803 MW in India, Brazil and Indonesia,
- Actively develops, jointly with a subsidiary of PLN and a local partner, a 59 MW hydroelectric project in Indonesia.
- Has begun construction of Sukarame, a 7 MW run-of-the-river hydroelectric plant in Sumatera, Indonesia.
Velcan has offices in Luxemburg, Singapore, New Delhi, Jakarta and Saõ Paulo and maintains personnel on its concession sites.
Velcan is listed on the Paris Stock Market (Euronext Alternext/Ticker ALVEL/ISIN FR0010245803).
Velcan never performed any Public Offer as understood under Directive 2003/71/CE of the European Parliament and Council.
Disclaimer
This press release contains prospective information about the potential of the projects in progress and/or of the projects of which the development has begun. This information constitutes objectives attached to projects and shall not be construed as direct or indirect net income forecast of the concerned year. Reader's attention is also drawn on the fact that the performance of these objectives depends on future circumstances and that it could be affected and/or delayed by risks, known or unknown, uncertainties, and various factors of any nature, notably related to economic, commercial or regulatory conjuncture, which occurrence could be likely to have a negative impact on future activity and performances of the Group.
This announcement does not constitute a public offering ("offre au public") nor an invitation to the public or to any qualified investor in connection with any offering. This announcement is not an offer of securities in the United States of America or in any other jurisdiction/country.
