N Ireland Storage Sells Shares
UK-based InfraStrata, which hopes to develop Northern Ireland's first gas storage venture, has sold shares in the company to cover running costs, it said January 25.
A month ago Northern Ireland's publicly-owned networks firm Mutual Energy divested its loss-making 10% stake, held for a decade, in InfraStrata’s core Islandmagee gas storage project for a nominal sum.
InfraStrata now says it has "conditionally raised £375,000 ($535,000) before expenses through a placing of 125mn new ordinary shares of £0.0001 each, at an issue price of £0.003/share with warrants attached." Net proceeds would be used "for InfraStrata's corporate costs, and care and maintenance costs of its gas storage project at Islandmagee" near Belfast.
InfraStrata said it continues talks with prospective debt and financing providers to fund the expected £2.2mn cost front-end engineering design (Feed) for the 0.5bn m3 working gas capacity of the storage project, as well as commercialisation talks with unnamed "major blue chip potential customers." Feed contractors have undertaken to provide loans of up to £1.1mn, so up to half of the Feed cost, it added.
The company expects the definitive closure by Centrica of the Rough gas storage facility, offshore eastern England, will improve demand for gas storage services in Britain and Ireland. However prospective investors will be aware that, because of Brexit, there is no assurance that Islandmagee – which would benefit the gas system on both sides of the inter-Irish border – would qualify for an EU grant towards its construction. That could cover as much as half the expected £300mn cost of developing the Islandmagee project, if it went ahead.