China Recycling Energy (CREG), an industrial waste-to-energy solution provider in China, has entered into a repurchase agreement with Sinosteel Group Jilin Ferroalloys (SGJF) for a Waste Heat Power Generation (WHPG) project.
Under the agreement signed by CREG’s wholly owned subsidiary Xi’an TCH Energy Technology (Xi’an TCH), SGJF will repurchase lease for the WHPG project for 90 million renminbi ($14.7 million).
Xi’an TCH had completed the project in December 2013 and leased it out for 24 years to Sinosteel last January. The company invested about 61.7 million renminbi ($10.1 million) in the Project and received net monthly minimum rental of about 1.7 million renminbi ($0.3 million). As of June 18, it received 29.5 million renminbi ($4.8 million) on this account.
Last December, Sinosteel Group transferred ownership of SGJF to Liaoning ZhongZe Group. And the repurchase was necessitated by the change of ownership of the project.
Through the agreement CREG will be receiving an early termination fee which it plans to invest in new projects already under contract, a statement says.
Besides developing new energy recycling solutions, CREG is also exploring new operating and revenue models. “We expect to complete one new system by the end of the second quarter,” the statement adds.
Ajith Kumar S