Econergy Share Discussion Threads

[damofarl] 30/4/2007 11:08

find out on Thursday! D.

[gsands] 30/4/2007 10:55

Went long today at 83p.
Could be a good entry point?

[damofarl] 24/4/2007 12:27

a quick post...with regard to calculating value of ECG's cer's, heres an example of the difficulties. This was taken from the european trading exchange. If one takes it that ECG has 16m CER's through to 2010 one could calculate based on monthly low a 'value' of the CER's of £475M (have I missed something blindingly obvious here that I'm not taking into account?)

Considerations

This figure has been calculate into stlg from euro, CERs may expire each year/not be recurring, the Chicago exchange quotes lower prices and ECG may not be able to transfer to euro exchange, strike prices may differ, legislation may change, they may not sell all their CER's etc.

Date taken from ecxeurope.com website

Market Update
ICE ECX CFI FUTURES DATA
February 2007*The ICE ECX CFI Feb-07 futures contract expired on 26 February 2007 and 25,000 tonnes were taken to expiry.
Prices in € per tonne
Contract Month Monthly High Monthly Low Monthly Average Settlement
Feb-07 -- -- 1.22
Mar-07 1.55 0.80 1.23
Dec-07 2.35 0.80 1.28
Dec-08 15.85 11.80 14.09
Dec-09 15.50 14.05 14.64
Dec-10 15.05 15.05 15.19
Dec-11 -- -- 15.74
Dec-12 -- -- 16.29


Any thoughts? D.

[damofarl] 23/4/2007 10:14

nice post utwiq

[utwiq] 23/4/2007 09:53

not much here is new, but good to see some promotion:

Econergy International Generates Clean Energy And Earns Carbon Credits

By Rue Swabey

Carbon brokers acquire carbon credits at an early stage with the intention of selling them on at higher price. The upside potential is attractive but the risks are significant and the share prices of the carbon brokers are closely correlated to the carbon price. One company appears to have found the right risk-reward equation; US-based Econergy International stands to benefit from an increase in the carbon price but as the bulk of its revenues will come from the sale of clean energy it should have both earnings stability and visibility.

Econergy was founded as a consultancy in 1994 advising on the development of sustainable energy in Latin America. Over the years it has built up considerable experience in clean energy technologies. In 2006 it raised £60million and it is investing the proceeds in clean energy assets. Econergy's CEO, Tom Stoner, describes the company as an independent power producer rather than a carbon broker. It invests in assets that generate clean energy and carbon credits (although the latter is not the driving force for the investment). In fact between 80 and 90 per cent of Econergy's sales come from energy sales. Consultancy fees are expected to dwindle as the principal focus becomes energy generation.

Econergy's brokerage division has extensive experience of dealing with the Clean Development Mechanism (CDM) of the Kyoto Protocol. Econergy takes care of all the documentation to prepare a project for the CDM and manages the validation and registration process. It also identifies buyers and negotiates emission reductions purchase agreements on behalf of its clients.

Econergy's geographic area of focus is Latin America. Energy security is important in Latin America. While some countries are oil rich like Venezuela, the net oil importers have developed alternative sources of energy. Econergy's portfolio is primarily wind and small-scale hydro but it also has some exposure to bio-fuels by way of an agreement with Clean Energy Brazil (AIM-CEB) to build ethanol projects in Brazil. Econergy has a total of 13 projects under consideration: one in operation, another in construction, six in development and five in exclusivity. These projects, with a total capacity of 677MW, represent potential equity investments of US$223m by year end 2008.

In addition to its own investments, Econergy is a partner in the US$25.2million CleanTech Fund, a private equity fund dedicated to clean energy in Latin American and the Caribbean. Shareholders include regional development banks such as the Inter-American Development Bank, the Corporación Andina de Fomento (CAF). The fund's mandate is for small and medium-sized enterprises.

In February, Econergy acquired a 50 per cent stake in two Bolivian hydroelectric plants (Corani) with a combined installed capacity of 147MW. Corani is an important generator representing 20 per cent of Bolivia's electricity supply. It owns Bolivia's largest reservoir and its low operating costs allow it to generate energy during the dry season. Duke Energy sold the asset because it perceived a heightened risk that the Bolivian government could nationalise the country's energy infrastructure. This risk is reflection in the purchase price. Econergy acquired Corani at a significant discount - paying US$20million for an asset that Duke had valued at over US$50million.

Econergy released a trading statement in February in which management reiterated that it is on track to have 1m MWh produced and sold in 2009. In fact, following the Corani acquisition the board is confident that Econergy is ahead of the original expectations stated in the admission prospectus. Its portfolio of carbon credits, known as Certified Emissions Reductions (CER), stood at 16.6million as of December 31, 2006, an 18 per cent increase since July 2006.

Econergy's share price has been less volatile than the straight carbon brokers such as EcoSecurities and Camco. This reflects the higher visibility of its future earnings (power contracts versus the carbon price). Econergy floated on AIM in February 2006 when it raised £60million at 100p. Since then the share price has traded in a range between 82p and 98p. The majority of its energy projects become operational in late 2008 so it will not show any earnings before 2009. In the meantime news flow is likely to be limited to updates on current projects. However any signs that the US is moving towards a mandatory emissions cap would offer interesting opportunities to companies like Econergy which are well positioned to expand into the US.

[damofarl] 20/4/2007 17:41

utwiq; thanks your thoughts. I couldn't have written it better myself. I purchased prior to the dip and subsequent to the dip, the dip making me recheck my initial reasoning, only to feel that it was more a prospect than at first investment. I must confess I first invested on the basis of the green/alternative energy points you raised above, and frankly disregarded the CER element. Even without the CER's i felt the investment case stacked up, for the patient.

"I'd like to know in more detail how the carbon reduction aspect augments the economics of each project"

Indeed, and I spent a lot of time, in vain, trying to ascertain that, via the 'worth' of the CER's they hold. Unfortunately there are to many imponderables, but I get reassurance that they have buyers/contracts lined up at the time of taking projects on, and not subsequent, which can only help cashflow.
Again, thanks your thoughts...only time will tell. D.

[utwiq] 20/4/2007 16:04

Thanks damofarl. My take on ECG is that it offers a very attractive utility/carbon play. Most of my investments are in resource stocks (metals, uranium, oil/gas) and I've been looking to take advantage of the need, which the industrialisation/urbanisation of the developing world is making acute, to increase energy supplies, especially in ways that are carbon-neutral. That is the great attraction of nuclear of course. I took a look at AGC, CLE, ECG, ECO and TRE a while back. With all of them, I found (and here the fault may lie in me rather than with the companies) the details of the economics quite sketchy. I invested in AGC (originally through its parent XLT), which has not been much fun, although it has to be quite an attractive purchase for someone wanting an instant portfolio of carbon reduction projects. When the ECG price dipped recently, I looked back into the accounts and initial prospectus. Very many utility plays, in the developed world, seem to have become overpriced, so a cheap entry into the developing world utility market looked attractive, especially given that the aim was for 20% IRR projects. Being renewable (and so not associated with the general exploiter from the West label) they should have an easier time with permitting and also suffer less from later political interference. And on top of that you get a stream of carbon credits, managed by a team that has considerable experience in the field. Management's experience is probably key in fact, given that it will ensure ongoing deal flow and should underpin later fund raising. The purchase of the Bolivian interest looks particularly astute, as it took advantage (I surmise) of a large American utility's need to get out of a politically uncomfortable situation; whereas for us, as small eco-friendly players, the operating environment is more congenial (I expect and hope). Plus, instant cashflow is very valuable indeed. The long-term plan to get various projects up and running and then raise monies against them, allowing further roll-out and perhaps diversification outside of Latin America, sounds very promising to me. I'd like to know in more detail how the carbon reduction aspect augments the economics of each project but at this stage I'm happy to invest in this "green-power utility trust" which has a stake in the carbon trading world, and which is likely to attract a lot of investor interest later for that reason. Certainly it is a much less risky play on carbon than either AGC or, I think, ECO/TRE or CLE (which has bounced all over the place!). I know a lot less about carbon, etc. (and how to value companies in this sector) than the resource sector, but those are my thoughts.

[damofarl] 20/4/2007 14:14

utwiq; drat...i'll start selling then! Seriously, what are your views on ECG? do you follow the 'green' energy / CER thing on a wider basis, or just finf ECG interesting?

[utwiq] 20/4/2007 14:11

For what it's worth - to make you feel less lonely (and so remove some of the comfort of contrarianism!) - I've watched this for months and invested about a week ago. Looking forward to the results.

[damofarl] 20/4/2007 14:08

david77; the fact that it seems like only you, me and ECG, doesn't bother me remotely. a quiet thread (4 postings amonth on average, 10 of which are mine!)/ lack of broker coverage/trading gossip etc. suits me fine....let the numbers do the talking..D.

[david77] 20/4/2007 12:14

damofarl - the main advantages of a spreadbet are

1: gearing - you can buy 4 times as many shares as you can by buying direct (25% deposit) - good if the share price is rising but a 25% fall wipes out your stake and if the company goes bust, you have to pay the remaining 75% of the share price when you took out the bet

and 2: no tax liability - good if you make a profit but you can't use losses to offset CGT on other share gains

"what conclusions do you draw?"

Other IGIndex punters have already taken on bets representing 2% of ECG. It showns that we are not the only optimists.

I have a few shares - I would have liked more.

[damofarl] 20/4/2007 10:56

david77; i accept your comments r.e. BFC. with regard to the ECG spreadbet, an area I don't follow, what conclusions do you draw? D.

[david77] 20/4/2007 08:42

When an investor/gambler takes out a long (buy) spreadbet, IGIndex buy the underlying shares so that they avoid any risk for themselves. I tried to buy ECG as a spreadbet today but IG already hold over 2% so won't buy any more.

[david77] 19/4/2007 13:22

damofarl "i have a thankfully small holding in BFC"

BFC was my biggest shareholdig at one time and sold @ about 145p after they failed to get the plant working at the end of Feb 06.

You owe Barclays about 80p for every share you own - my advice would be to sell for what you can get 'cos very soon you will get even less - and if I was the account manager at Barclays, you wouldn't get anything. I don't understand why they haven't already pulled the plug and shut the lot down.

[damofarl] 19/4/2007 10:43

david77 - me too - frankly if the results say no more than 'steady as she goes', I think well see a significant uplift. I'm alittle surprised that the recent uplift/volatility in other renewabals/CER traders has not been reflected in ECG which seems quite stable comparitevily, if on a slight drip down. Personally i think the results will be v.positive, if only to justify the accompanying announcement with regards to the remaining share (rights) being listed.

Your feedstock point is an interesting one (i have a thankfully small holding in BFC); there was an article in one of the broadsheets a few weeks ago suggesting that the new commoditiy run this year would be on agrucultural stuff, as a consequence of both increasing population and increasing biofuel requirements. D.

[david77] 19/4/2007 08:20

Thanks Damofarl - I'm optimistic - they seem to be in the right place at the right time - biofuels (both diesel and petrol replacements) in trouble with increasing feedstock prices

[damofarl] 19/4/2007 07:31

morning all; annual results will be announced May 3rd. D.

[david77] 07/4/2007 12:27

Damofarl - I don't know when results are to be released but CGT status looks ok. I paid a fortune in CGT recently and will have another to pay next Jan, so I try to buy qualifying AIM shares and hold them for two years or more.
-------

Dear David

Thanks, your email found me eventually. It certainly seems that Econergy would qualify, but to get comfort you should speak to your own legal advisor.

Thanks
Tom

From: [e-mail] [mailto:[e-mail]]
Sent: Friday, March 30, 2007 3:52 AM
To: Suzanna Rosenberg
Subject: Someone has filled out your form - Econergy!
Someone has filled out your form - Econergy!
Name : David Stoebanks
Title :
Organization :
Street Address :
Address (cont.) :
City :
State :
Zip :
Code Country :
Work Phone :
Fax :
Email : [e-mail]
Comments : For the attention of the Company Secretary Dear Sir I am a UK private investor. Can you please tell me whether this company qualifies as a business asset - meaning reduced CGT after holding for a year or two? To qualify, it must be a trading company and must not be listed other than on the UK AIM. Thanks David Stonebanks


Dr Tom Frost
Corporate Finance

direct: [phone]
mobile: [phone]

Numis Securities Ltd
Cheapside House
138 Cheapside
London. EC2V 6LH

--------------
Dear Mr Stonebanks,


Please see below the answers to your questions. If you have any further queries please feel free to contact Helene Crook ([e-mail]), Econergy’s investor relations manager, and she will be able to help.

1) We are unable to give you advice, please contact your financial adviser or accountant.

2) Econergy is a trading company and has offices in Boulder, Colorado, and Washington, DC, USA, Sao Paulo, Brazil, and Monterrey, Mexico. It has under development 40 clean energy projects throughout Latin America that may also sell carbon credits under the Clean Development Mechanism. In addition to the carbon trades it brokers, it also takes equity stakes in projects which yield carbon credits. Typically these are clean energy investments in wind power, small-scale hydro, bagasse cogeneration, and other forms of clean energy.

3) Econergy’s shares are not traded on any other stock market.

I hope this helps.

Best wishes

Alexandra Parry

Haggie Financial LLP
Roman House
Wood Street
London EC2Y 5BA

[damofarl] 07/4/2007 11:57

david77;

I was wondering when the final results were out...interims were out 13/9 pertaining to 6 months ending June 2006, so i'd of made that around middle March for full year. I have emailed Econergy direct to ascertain a response/date. I'm sure you've dyor etc, but if you haven't seen the original placing document, it is well worth a read (chunky at 128 pgs but worth the effort!). some snippets from it:

"The business of the Company is that of a holding company, and the directors are to procure that all operating activities of the Group are to be conducted by the Company's subsidiaries....."

Not sure whether this helps with your CGT question, but it isn't listed on any recognised stock exchange. In the placing statement, its business aims states producing clean energy which generally (but not exclusively) generate tradeable CERS. It also says that income will be generated from sale of power generated and trading CERS..to me thats definately a trading company.

"Lock-in Deeds
Lock-in deeds each dated 20 February 2006 entered into between the Company, Numis and each of the executive directors and certain of the Company's other shareholders who, following Admission, will have in aggregate an interest of approximately 26 per cent. of the issued share capital of the Company (each a "Covenantor") pursuant to which, each Covenantor has undertaken not at any time prior to the first anniversary of Admission without the prior written consent of Numis, to dispose of any Ordinary Shares in which it is interested. This deed also contains orderly market provisions preventing each Covenantor from disposing of any of its interests in Ordinary Shares except through Numis during the eriod from the first anniversary of Admission until the date 12 months thereafter.

At the date of this document the authorised share capital of the Company is £1,450,000 divided into 145,000,000 Ordinary Shares of £0.01 each, of which 87,000,000 Ordinary Shares of £0.01 have been issued, credited as fully paid.

On 17 February 2006 a written resolution of the Company was passed in the followingterms:

3.3.1 The Directors were authorised to exercise all powers of the Company to allot equity securities up to the authorised share capital of the Company, provided that such power shall expire on the earlier of the date that is fifteen months from the passing of the resolution or the closing of the Company's next annual general meeting, save that the Company may at any time before such expiry make any offer or agreement which would or might require equity securities to be allotted after such expiry and the Directors shall be entitled to allot equity securities in pursuance of any such offer or agreement as if such authority had not expired;..."

The last bit their might explain the delay in results....D.

[david77] 05/4/2007 18:28

"They seem on top of their game; only question is, is the 'green' game the right one? Long term (2-5 yrs), for the patient, i believe it is. D."

Ecofin have investments in wind farms and they reckon that they provide a good return on investment. I would expect investments in some of these far-away places to be even more profitable.

I have some pretty risky investments - this would provide some balance.

[damofarl] 05/4/2007 11:04

david77; yes over 30% of the capital held by institutions, and a lot of buying by directors. The 16m CER's are somewhat unquantifiable value wise (i've tried but theres so many imponderables), but I like the way the company gets involved/organized with projects, as witnessed by Waldrons (ta!) previous 'Econergy Intl Beberibe wind project update' post. If you check previous announcements of new projects, they are always accompanied by the news that they have already secured the sale of energy (to be) produced. They seem on top of their game; only question is, is the 'green' game the right one? Long term (2-5 yrs), for the patient, i believe it is. D.

[waldron] 05/4/2007 08:20

Econergy Intl Beberibe wind project update


RNS Number:4635U
Econergy International Plc
05 April 2007






Press Release
For Immediate Release
5 April 2007



Econergy International PLC

Beberibe project update



Econergy International PLC ("Econergy International" or "the Company"), the
clean energy and carbon project developer, announces two significant
developments with its 25.5 MW Beberibe wind project.


*Signed purchase and installation agreement with Wobben Windpower
Industria e Comercio Ltda

*Econergy International has acquired 100% of the project



Econergy International has signed an agreement with Wobben Windpower Industria e
Comercio Ltda., the Brazilian subsidiary of the German company, Enercon GmbH, to
purchase and install 32 x 800 KW wind turbines to develop the Beberibe project.


The Company has also acquired 100% of the project. The project is expected to
generate on average approximately 92, 287 MWh per year and the Company expects
to install the project with a capital cost of approximately $64.2 million. An
agreement for the electricity generated by this project is in place with
Eletrobras, Brazil's government owned electric company with a 20 year term at a
starting tariff of R$ 202 per MWh. The project is expected to enter into
commercial operations by the end of the first quarter of 2008. It had been
previously announced that the Company was to acquire 95% of the project.


"This is another significant milestone in the progress of Econergy International
as we have both a wind and hydro project under construction contracts" said Tom
Stoner, CEO of Econergy International.


He further commented: "Because of the quality of the development team we have
put together and the extensive pipeline they have developed we fully expect to
exceed the goals of our business plan set forth in our Admissions Document
published in connection with our AIM listing in February of last year."



--ENDS--


Further information, please contact:



Econergy International PLC
Tom Stoner Tel: [phone]

Haggie Financial
Peter Rigby Tel: [phone]
Alexandra Parry Tel: [phone]




Econergy International


Econergy International, which has offices in Boulder, Colorado, and Washington,
DC, USA, Sao Paulo, Brazil, and Monterrey, Mexico, has under development 40
clean energy projects throughout Latin America that may also sell carbon credits
under the Clean Development Mechanism. In addition to the carbon trades it
brokers, it also takes equity stakes in projects which yield carbon credits.
Typically these are clean energy investments in wind power, small-scale hydro,
bagasse cogeneration, and other forms of clean energy.


In February 2006, Econergy International PLC floated on the Alternative
Investment Market of the London Stock Exchange. The Company's mnemonic is ECG.


For further information visit: www.econergy.com






This information is provided by RNS
The company news service from the London Stock Exchange

END
MSCBRGDSRBGGGRS

[david77] 04/4/2007 16:11

damofarl - 1: they have a fair number of institution shareholders who, with luck, should know what they are doing,

2: I can buy now for less than the directors paid recently

3: I have some Ecofin shares in an ISA that have done well over the last couple of years - ECG are in the same line of business.