GNX - Genex Power

[silu]

I thought it deserves its own thread as the coming weeks will be interesting as the feasibility study for its pumped hydro power station and a bigger solar farm will be released.

In summary:
​Genex Power is an Australian public company, focused on the production and storage of renewable energy. Genex is currently developing two innovative clean projects located in Northern Queensland, which will aim to deliver attractive commercial returns for its shareholders. http://www.genexpower.com.au/

Project One: The Kidston Solar Project​
(a) Phase one of the project will have a capacity production of up to 50MW. GNX has secured an $8.85 million grant from the Australian Renewable Energy Agency, and a 20 year power purchase agreement from the Queensland government (GNX is targeting financial close on the solar project in November 2016, with first operations in Q4 2017). QLD Government has indicated that prices of $80-100/MWh were acceptable. The mid-point of this price range would result in the project generating close to $13m pa of revenue. GNX has selected First Solar as its supplier of PV modules.
Morgans summarized as follows "Given the solar project has secured a long-term government-backed revenue stream, we expect a high proportion of the construction costs may be funded by project finance debt (we assume >$100m). This gearing, combined with the ARENA grant, should minimise equity funding requirements. Our project modelling assumes only $10m of an estimated $126m construction cost (cost sourced from ARENA) will be funded by equity. If GNX sells down an equity interest in the project, there may be no need for a capital raising by GNX to fund the equity requirement (albeit GNX's share of the project will be diluted). GNX is in discussions with potential investors in the project."

(b) Phase two of the project will increase this total nameplate capacity up to 150MW. ​

Project Two: The Kidston Pumped Storage Hydro Project
(a) Upon completion, this project will have a total capacity of 1,500MWh to 2,250MWh.
That study, also supported by a grant from ARENA, is expected to pave the way for Genex to seek funding which will also include some 180kms of transmission. First production from this project is targeted for 2019

As I said the next few weeks will be interesting. I've accumulated below its 20c IPO price (current SP 22.5c). Yesterday it had it's highest turnover of shares ever with an intraday increase of +15.4%. Not sure yet whether this is a whisper of confidence about the pumped hydro storage project.