Coro Energy Plc, the South East Asian energy company focused on supporting the regional transition to a low carbon economy, is pleased to provide the following corporate update.
Italy - Gas Production
Further to the previous announcements on 7 March and 30 March 2022, Coro is pleased to report that average gas production during April 2022 (post the recommencement of Sillaro in March 2022) was approximately 20,000 scm/d generating approximately €580,000 in revenue. In addition, Coro's Italian subsidiary also received a VAT reclaim of approximately €200,000 in April 2022.
The Company reports that Italian gas prices remain strong, with an average price in April 2022 of €0.98/scm. The Company therefore continues to expect significant free cash flow from its Italian portfolio.
Further production enhancing activity is scheduled across the Italian portfolio during the course of the year.
Vietnam - Solar (85% owned by Coro)
Following entry into a 25-year Power Purchase Agreement with Phong Phu, a listed Vietnamese high volume manufacturer of textiles, announced on 11 April 2022, the Company is completing permitting and procurement activities and intends to place equipment orders in the coming weeks. The 3MW solar rooftop pilot project is expected to achieve maiden revenues before the end of 2022 with net cash flow of approximately $0.3m per annum thereafter.
Philippines - Solar & Wind (80% owned by Coro)
Coro has two development stage renewables projects in the Philippines, a 100MW solar project and a 100MW wind project which, allowing for permitting timelines, are 6 and 12 months respectively, away from achieving ready-to-build status. In addition to the wind data gathering exercise which has commenced with Lidar equipment onsite and Met Mast equipment under contract, the Company is currently focused on securing land access alongside regulatory permits and approvals.
Indonesia - Duyung PSC Gas Production (15% owned by Coro)
The Mako gas field is one of the largest gas discoveries (495 Bcf gross, full field) 2C (contingent recoverable resources) in the West Natuna Basin and, the Directors believe, the largest confirmed undeveloped resource in the area.
The Company is pleased to report that regional gas prices in Europe and South East Asia remain strong and that the macro environment is creating the incentive for the negotiations of the current Heads of Agreement at Mako to be finalised in a binding Gas Sales Agreement.
Coro reports that the operator of the PSC continues to make steady progress towards a Final Investment Decision ("FID") in 2023 with first gas production and sales targeted for 2025. The Company estimates its share of pre-FID expenditure at approximately US$1m, with further capital expenditure post FID (assuming a leased processing facility) of approximately US$38m net to Coro. Partners can also elect to advance the expected first gas date by ordering long lead items (estimated to cost approximately US$2m, net to Coro) prior to FID. The Company expects, as with other large gas developments globally, to be able to fund the development capital expenditure through a combination of Reserve Based Lending and farm-in transactions.
Coro has a strong funding position from a combination of its cash position of approximately US$2.8m (as at 12 April 2022), supported by the free cash flow from its Italian assets and the Vietnam solar pilot, which is expected to be operational later this year. These projects will support the further development of the Company's South East Asian portfolio.
Mark Hood, Coro's Chief Executive Officer commented:
"Pleasingly, as the constraints imposed by COVID are further eased in the region, momentum is building for the Company's development assets. Notably, the opportunities presented by our Italian assets leave us in a strong financial position as we look to generate revenues from our blended portfolio of gas and renewables assets."