Prospex Energy (PXEN) said its Spanish subsidiary Tarba Energía has signed a contract to rent a transformer for the El Romeral gas-to-power plant in Andalucía, allowing electricity generation and sales to resume.
The transformer is due to be delivered and installed before the end of January 2026, and will remain on hire until the delivery of a new transformer that Tarba ordered in November 2025, which is currently expected in the third quarter of 2026.
Tarba said production has been halted since 1 July 2025 after an agreed replacement rental transformer was not delivered. To secure immediate supply, Tarba has waived a €76,000 claim for compensation for lost production, arguing the time and legal cost of pursuing the claim in Spain would likely outweigh its value and further delay restart.
Tarba noted the plant sells power into the spot market, with recent intraday prices ranging from €0 per megawatt hour (MWh) at midday to more than €200 per MWh overnight. As a result, it intends to prioritise generation during nighttime hours when prices exceed €100 per MWh.
Meanwhile, Tarba’s five-well drilling application is in the final phase of the Environmental Impact Assessment (EIA) process. The full EIA documentation was submitted to Spain’s Ministry for the Ecological Transition and the Demographic Challenge (MITECO) on 14 November 2025 and was forwarded internally to MITECO’s Environmental Department on 5 December 2025, with a stated timeline of 90 to 180 days for this step. The five wells target the lowest-risk structures, with best estimate contingent and prospective gas resources of 18.2 bcf, and average depths of about 700 metres.
Prospex’s CEO Mark Routh said: “The Company is pleased to have sourced a rental transformer for the El Romeral plant. The transformer, which has an almost unique voltage and power specification is expected to be installed this week allowing Tarba to resume the production of electricity before the end of January.
“We remain confident in the value and development potential of the El Romeral asset and are pleased that the permitting to drill five new natural gas wells is in its final stages.
“The El Romeral power plant can reach full capacity from production from just two of the proposed five new wells. Any extra gas from the remaining new wells or any future wells drilled on the concessions will support expansion plans at the power plant as well as the ability to supply natural gas directly to the gas grid. The El Romeral concessions have substantial development potential with more than 90 bcf of gas now owned 100% by Prospex.
“We will continue to keep shareholders updated on the permitting process. Since we are now in the final stage of receiving the permits to drill these five wells, we have started the process of optimising the funding of the wells by seeking potential debt funding and farm-in partners.”
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Getting a rental transformer back on site should restore near-term cash generation at El Romeral and reduces reliance on the long-lead replacement unit due in 2026. The bigger value driver remains the five-well permitting and funding plan, which could lift gas supply and give Tarba more flexibility to run the plant when power prices are strongest.