TORONTO, Nov. 21, 2024 (GLOBE NEWSWIRE) — Abraxas Power Corp. (“Abraxas”), a leading energy transition developer is pleased to announce its subsidiary Abraxas Power Maldinvest Ltd. has entered into a loan agreement with RE Royalties Ltd. (TSX.V: RE) (OTCQX: RROYF) (“RE Royalties”), a global leader in renewable energy royalty-based financing, to receive a secured loan facility of up to $10 Million (the “Loan”) to support the construction of solar projects in the Maldives.

 

The Loan will have multiple tranches, with the first tranche of approximately $1.4 Million that closed on November 18, 2024, to be used for construction of two rooftop solar projects (the “Projects”) with a combined generation capacity of 0.77 MW_DC. Subsequent tranches will be used for the construction of additional solar projects in the Maldives and will be advanced if certain conditions are met, such as the completion of satisfactory due diligence and approval by RE Royalties’ board of directors.

The Projects are located at a hospital in Malé, the capital of the Maldives, and an island resort approximately 50km north of Malé. They will generate revenue from power purchase agreements (“PPAs”) with the co-located businesses. Currently, both businesses rely primarily on electricity produced by diesel generators. By entering into the PPAs, they are expected to save on operating expenses and significantly reduce the environmental impacts of their operations.

The first tranche of the Loan has an 18-month term and an interest rate of 13% per annum on advanced funds, compounded monthly. RE Royalties received an arrangement fee of $200,000 at closing to cover legal and due diligence expenses. RE Royalties will receive a gross revenue royalty of 2.0% on the Projects for the term of the PPAs.

J. Colter Eadie, CEO of Abraxas, commented: “This investment has been a significant catalyst for initiating the energy transition in the Maldives, aligning with Abraxas’ broader mandate from the Government of Maldives to decarbonize under its Nationally Determined Contributions (NDC) commitment. The RE Royalties investment facilitates the development of a distributed generation portfolio in the Maldives, focusing on decarbonizing critical economic sectors like healthcare and tourism.

Tourism accounts for 28% of the country’s GDP and generates 60% of all foreign exchange income. The Maldives’ ability to achieve its sustainability goals within the tourism industry will be vital for its ongoing success as one of the world’s premier destinations. Abraxas has identified a pipeline of over 100 MW of potential fossil fuel capacity that can be replaced with clean and renewable energy at some of the world’s largest hotel brands.

Additionally, Abraxas has been granted a first-of-its-kind Special Economic Zone permit to develop an energy efficiency project, which will enable the government of the Maldives to replace up to 50% of its fossil-derived energy in the capital with 100% green energy. This project will be one of the largest ocean-floating solar installations in the world and demonstrates Abraxas’s capability to facilitate the global energy transition for governments and industries with unique and innovative solutions.

RE Royalties has played a crucial role in addressing these challenges, and we look forward to continuing our partnership with RE Royalties in the Maldives and other regions.”

Bernard Tan, CEO of RE Royalties, stated:

“This transaction allows RE Royalties to establish a foothold in a new jurisdiction with a clear pathway to deploy more capital. We are thrilled to be working with the management of Abraxas again and we look forward to collaborating with them in the future to further grow their portfolio of renewable energy projects.”

About Abraxas Power Corp.:

Abraxas Power is a pioneering energy transition developer focused on decarbonizing hard-to-abate sectors and creating value by solving the current and future challenges of the energy transition. Abraxas Power’s broad mandate allows it to see opportunities across technologies and geographies to transform the global energy industry. Our team has extensive experience in leading, financing, and solving the challenges associated with energy transition, and a proven track record of delivering complex, large-scale development projects across various disciplines, including renewable power and storage, hydrogen and ammonia production, industrial and precious metals, large-scale project construction, and operations at scale. The team possesses strong project finance and capital markets experience and has a history of creating value for shareholders, stakeholders, and the communities they live in. Abraxas has signed strategic partnerships with various global strategics and technology providers.

Abraxas has secured over US$9 billion in capital projects through competitive government awards over the past year in furtherance of the energy transition, including its marquis Exploits Valley Renewable Energy Corporation project in Newfoundland, Canada.