Ncondezi Energy Limited (“Ncondezi” or the “Company”) (AIM: NCCL) is pleased to announce its audited final results for the year ended 31 December 2020.

Operational Highlights:

Ncondezi Power Project

• Submission of tariff proposal to the Mozambican Government and Electricidade de Moçambique (“EDM”).
• Transmission Integration Study and Mozambican Power Market Outlook Study updates (the “Independent Studies”) commissioned and submitted following initial tariff discussions with EDM.
• Shareholders Agreement Term Sheet (“SHA TS”) signed with China Machinery Engineering Corporation (“CMEC”).
• Submission of Historical Cost Audit to CMEC.
• Supplementary Agreement (“SA”) to the Joint Development Agreement (“JDA”) signed with CMEC agreeing basis for accelerated development work to be carried out on the Project.
• Updated Feasibility Study submitted to EDM.

C&I Solar PV and Battery Storage Projects

• Force majeure notice issued on maiden C&I 400kWp solar PV plus 912kWh battery storage project (“C&I Maiden Project”) following travel restrictions due to the global outbreak of COVID-19.
• Relationship Agreement signed with GridX Africa Development (“GridX”) to fund a pipeline of projects in Mozambique up to a total of US$5.5 million.

Corporate Highlights

• Scott Fletcher, the Company’s largest shareholder, appointed as a Non-Executive Director of the Company.

Financial Highlights

• US$250,000 drawn down from the US$750,000 working capital facility. Facility expired end of June 2020.
• “In principle” support received from all Shareholder Loan holders for Shareholder Loan restructuring proposal.
• Board and management signed a binding undertaking (“Undertaking”) not to call in the Shareholder Loan before the later of 30 November 2022 or when the Restructuring is completed.
• Two successful fund raises to finance general working capital, the first in May 2020 raising £650,000 at 3.0p, the second in November 2020 raising £750,000 at 4.5p.
• Cash at bank of US$0.9 million as at 31 December 2020. Based on management projections the Group is funded into September 2021 with further funding required to meet operating cash flows under current forecasts before the end of Q3 202 or in the event of accelerated project advancement.

Post balance sheet events

• US$21.0 million historical costs relating to the Ncondezi Project agreed “in principle” with CMEC.
• Remobilisation of construction at C&I Maiden Project.
• Master Services Agreement (“MSA”) signed with Synergy Consulting (“Synergy”) to provide financial and transaction advisory services to the Group for the Ncondezi Project.
• US$500,000 bridge loan (“Bridge Loan”) between the Company’s wholly owned renewables subsidiary, Ncondezi Green Power Holding Ltd (“NGP”) and certain Company Directors to finance the construction of C&I Maiden Project.
• NGP and Captive Power Limited (“CPL”) signed a binding Relationship Agreement under which NGP has the right (but not the obligation) to fund a pipeline of C&I solar and battery storage projects in Mozambique. The CPL Relationship Agreement supersedes the existing Relationship Agreement signed with GridX. As part of the suspension process, GridX agreed to novate to CPL all commercial agreements in relation to the C&I Maiden Project and to release to CPL any rights in relation to 5 of the existing 6 projects in the pipeline.
• Term sheet with binding exclusivity signed between NGP and Nesa Capital (Pty) Ltd and Nesa Engineering (Pty) Ltd (collectively “NESA”) detailing proposed formation of a new joint venture company (“JVCo”) to create a leading regional Southern African champion in the C&I renewable energy and battery storage sector.
• Binding agreement signed between NESA, Nesa Investment Holdings (“NIH”) and NGP granting NESA and NGP exclusive rights to negotiate terms on which they would acquire, through the proposed JVCo, a minimum 51% interest in a 15.5MWp solar PV plus 0.2MWh battery storage C&I portfolio across 66 sites in South Africa (the “NIH Portfolio”) with a subsequent option to acquire up to 100% within a 5 year period.

The Company will post its Annual Report and Accounts for the year ended 31 December 2020 (“2020 Annual Report and Accounts”) to shareholders on 25 June 2021. A copy of the 2020 Annual Report and Accounts will be available on the Company’s website www.ncondezienergy.com.

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