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PannErgy buys into industrial/ agriculture heat customer in Miskolc

PannErgy buys into industrial/ agriculture heat customer in Miskolc Geothermal bath at Miskolc, Hungary (source: flickr/ nrares, creative commons)
Alexander Richter 7 Oct 2015

Hungarian PannErgy buys equity stake in a company that is to buy heat from PannErgy's geothermal heating project at Miskolc, Hungary.

Hungarian geothermal heating developer and operator PannErgy Plc. announces that its subsidiary, CSRG Energia Ltd. has acquired a 40% stake in GEO-WENDUNG Ltd. The company is a local player developing project utilising heat from the Miskolc geothermal district heating project for industrial/ agricultural use.

PannErgy aims to increase the utilisation of the heat produced at its Miskolc geothermal projects. The company has been developing the project over the past few years. Temperatures used  for the district heating systems in the Avas housing estate and consumers of the downtown area of Miskolc are around the boiling point and the re-injected fluid after utilisation is mostly around 55-60°C.

For the Miskolc Geothermal Project, GEO-WENDUNG Ltd.’s project has one of the largest secondary heat utilization potential, which intends to implement the geothermal energy district heating system to supply the surrounding agricultural and industrial zone of Kistokaj, Mályi and Nyékládháza.

GEO-WENDUNG has obtained the Letter of Intent from potential customers for an annual sum of 120.000 GJ heat energy in accordance with the early project development phase prior the construction of the project.

PannErgy’s expressed interest is the fulfilment of the project on time, by the end of November 2015, providing the opportunity to extend the revenue opportunities for the Miskolc project. For this reason, CSRG Energia Ltd., 100% owned by PEGE Ltd., member of the PannErgy Group, acts as a strategic investor in the capital increase of GEOWENDUNG, simultaneously with the capital increase of a Hungarian private equity fund.

The total amount of the investment is HUF 250 million (around $900k), which provides PannErgy a 40% stake in GEO-WENDUNG. The entering new owners and the existing 43 shareholders have concluded a Syndicate Agreement for the regulation of their future co-ownership cooperation, which contract constitutes usual rights and obligations applicable of similar transaction for the parties involved.