Prospex Energy (PXEN ), an oil and gas investment company, said it has successfully installed a 41.5 kW solar array, comprising of 83 panels, on the roof of its El Romeral power plant in Spain. Prospex has a 49.9% working interest in El Romeral through its interest in Tarba Energia.
Project Apollo, as the solar installation is known, currently powers part of the ancillary services at the plant, thereby reducing self-consumption and increasing sales of electricity. The cost of installation was less than €50,000, financed from existing funds held by Tarba. Payback from the investment is estimated at 3-4 years.
Project Apollo is expected to generate 66 MWh in its first year.
The pilot project will give valuable experience to Tarba in managing solar installations, which the company can then use for Project Helios - a much much larger 5 MW (5000 kW) solar array, to be built adjacent to the El Romeral Plant. Project Helios will cogenerate along with El Romeral using the same connection to the Spanish grid. Project Helios is currently at FEED stage.
Mark Routh, CEO, commented:
"Project Apollo establishes us as an emerging integrated energy company and reduces our carbon footprint by leveraging an existing asset to incorporate photovoltaic capabilities. Not only will this directly result in increased sales of electricity at the El Romeral power plant, but importantly, it also furthers our ambition to diversify our power assets as we look to enhance our conventional/renewable energy ratio. This will be a core pillar of Prospex's strategy in the future as we balance the immediate and critical demand contours of domestic gas markets with our responsibility to provide long-term sustainable power across Europe."
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Investors welcomed today's news, sending PXEN shares up 5.6%. Shares have completely defied the recent downturn in equities, rising 18% in the last 5 days, 26% in the last 6 months, and an impressive 95% over the past 12 months.
Why are investors so excited about Prospex? The company is making the right investments to answer strong European demand for locally produced energy, particularly in natural gas and renewables.
Just last week, Prospex shares jumped 14% after Italy granted the company approval for production at its Selva field gas plant, with first gas expected in Q2 2023. Days before that announcement, Prospex said it had raised £1.87m to fund operations at Selva. As has been the case with El Romeral, Prospex's natural gas operations in Italy are expected to yield strong revenues amid rocketing energy prices.
The company's May's FY21 final results revealed steady expansion with a total assets increase of 56% to £8.9m, reflecting "measured recognition of positive changes in the forward curve of European gas prices as at 31 December 2021."
Investors have also welcomed Prospex's diversification into solar. The El Romeral site in Spain is ideal for solar generation. The ROI for solar continues to improve, evidenced by Project Apollo's short payback time of only 3-4 years. Project Helios will be a game changer for the company, with 5 MW of clean energy capacity, and availing of existing infrastructure at El Romeral, as Europe continues its struggle for energy independence amid surging energy prices.
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