Norwegian geothermal developer secures equity investment
Private equity fund manager Kerogen Capital becomes major shareholder in Norwegian geothermal developer Geothermal Energy Nordic AS.
In an announcement yesterday, Norway-based Geothermal Energy Nordic AS (“GTML”) reports that Kerogen Capital (“Kerogen”) has made an initial financial commitment to become its majority shareholder alongside GTML’s founders and management team. GTML’s business is to build, own and operate energy plants that provide renewable heat from deep energy wells drilled up to the depth of approximately 2,000m. The technology of circulating hot water from deep wells provides a non-intermittent, clean and renewable source of heat, with a strong value propo2sition to customers. The Company will use fit-for-purpose drilling rigs and plans to drill its deep wells with optimal energy take-out and a minimal surface footprint. Kerogen is currently investing Kerogen Energy Fund II with total capital commitments of over USD 1 billon (including its parallel and co-investment funds). Additional capital from Kerogen or its LPs may be available for GTML as the company develops its business and projects.
“We are convinced that the timing of rolling out geothermal energy on a large scale from deep energy wells is excellent, given the current strong demand for local and renewable energy. We see numerous interesting opportunities in the market today. Being backed by a financially strong investor like Kerogen, will enable us to capture these market opportunities and to build a valuable and sustainable energy company.”, so Thor Erik Musæus, CEO of GTML.
Commenting on the investment, Tushar Kumar, Partner at Kerogen, commented: “We are very excited about investing in geothermal energy to drive forward decarbonisation of heat for commercial, industrial and residential users. Baseload heating remains a hard-toabate sector and we are pleased to play our part in progressing technologies and projects that help in getting to Net Zero carbon target in line with the Paris Climate Agreement.
We are pleased to have partnered with the GTML management team who have deep technical expertise and experience in geothermal and look forward to working with them on developing renewable heat projects in Norway and other Nordic countries. GTML is our second investment in Norway from our current fund and demonstrates our support for continued investments in the Norwegian energy sector.”
The geothermal competence and associated network now gathered in GTML, has evolved for more than a decade. The Company has over the past two years established a substantial pipeline of potential geothermal projects in Norway and Sweden, spanning from additional capacity in district heating, new and retro-fit energy solutions for apartment buildings and schools, to surface heating like football courts. The ambition is to become a leading company within geothermal energy in the Nordic countries.
The GTML team is experienced in developing industrial companies and has a complementary skillset within geothermal energy, drilling technology as well as business development and finance. The management team of GTML consists of Thor Erik Musæus, CEO; Sjur Talstad, COO; Bjørn Stale Tennfjord, CFO; Thilo Theloy, Drilling Manager, Pal Jarness, Swedish/Finnish markets and Executive Director and Bjørn Inge Tønnessen, Advisor and Executive Director.
In addition to the current team there are long-lasting co-operations with large and reputable consultancy firms and research institutes, all having excellent knowledge of the benefits of geothermal energy. There are also active plans to increase the GTML-organisation as the business develops.
SpareBank 1 Markets AS acted as the financial advisor and Arntzen de Besche Advokatfirma AS as the legal advisor to the GTML management team. Kvale Advokatfirma DA acted as the legal advisor to Kerogen Capital.
Source: release by email