Vow Green Metals signed on 27 November 2023 agreements with Vardar AS, a regional renewable energy producer with operations and ownership within bioenergy, CCU, wind, solar and hydropower, to invest up to NOK 100 million in Vow Green Metals and its large-scale biocarbon production facility at Hønefoss.
The NOK 100 million investment from Vardar will be split equally between Vow Green Metals AS and VGM Operatør AS, a wholly owned subsidiary of Vow Green Metals, holding all assets, rights and obligations related to the large-scale biocarbon production facility at Hønefoss.
Under the terms of the investment agreement, Vardar will give a loan of NOK 50 000 000 (the “Loan”) to Vow Green Metals. Vardar has the option to subscribe for shares in Vow Green Metals for a six months’ period and use the Loan as a contribution in kind to settle the subscription consideration. The subscription price in the option agreement will be the lowest of (i) NOK 3.20 per share, and (ii) five days volume weighted average price (VWAP) plus a 30 percent premium.
Furthermore, Vardar intend to become an equity partner in VGM Operatør AS, the Hønefoss plant, with an investment of NOK 50 000 000,-. The investment (share subscription) will be completed when an offtake agreement for biocarbon from the production facility at Hønefoss has been signed.
The strategic investment aligns well with Vardar and Vow Green Metals’ commitment to accelerate renewable energy production and emissions reduction at industrial scale. The parties expect to see significant synergies from the collaboration, including utilization of the parties’ combined competence and capabilities within energy production, thermal heat distribution and utilization, and biomass sourcing and handling.
“We are delighted to welcome Vardar as a strategic partner. Vardar has a broad approach and commitment to accelerating the green transition, they play a central role in the energy system at Hønefoss and are an essential partner to realize the full potential of our large-scale production facility in the area,” said Chief Executive Officer of Vow Green Metals, Cecilie Jonassen.
Vardar operates the district heating network in the Hønefoss region through its subsidiary Vardar Varme AS and distributes the thermal energy at Treklyngen Industrial Park where Vow Green Metals’ large-scale biocarbon production facility is under development. In relation to the ongoing infrastructure work on the plot of the facility, Vardar Varme has invested in district heating pipes connecting the production plant to its district heating network, enabling annual energy offtake of up to 70 GWh from the facility. Vow Green Metals’ large-scale biocarbon production facility will become one of Europe’s largest, with its 20,000 tons production capacity and abatement potential of 100,000 tons of fossil CO2 p.a.
“Today’s signing of the investment agreement with Vow Green Metals is a testament to our mission to contribute to increasing access to renewable energy and sustainable reduction of fossil emissions. We are looking forward to being a partner and contributor to bolster Vow Green Metals’ efforts in building a new green industry further and are especially excited to take part in the large-scale project in our backyard,” said Chief Executive Officer of Vardar, Robert Olsen.
