Investor Presentaiton slide image

Investor Presentaiton

Disclosures GREEN GAS COLORADO In determining our long-term run-rate EBITDA, management forecasts are based on the trailing three-year historical average pricing of $101/MMBtu, expected run-rate production of 360,000 MMBtu, and anticipated offtake, transportation charges and operating costs. 1 The 2019, 2020, 2021 and 2022 periods demonstrate the revenue and EBITDA that GreenGas Colorado would have received based on the Company's estimated RNG production of 360,000 MMBtu per annum, the annual historical average pricing for LCFS, RIN and brown gas of $106/MMBtu, $107/MMBtu, $125/MMBtu, and $96/MMBtu, respectively, and average offtake, transportation charges and operating costs of $14.9 million. The chart is the Canadian dollar ("CAD") equivalent based on an average United States dollar to CAD exchange rate of 1.36. 2 The 3 Year Rolling Average period demonstrates the revenue and EBITDA that GreenGas Colorado would have received based on the Company's estimated RNG production of 360,000 MMBtu per annum, the historical average pricing for LCFS, RIN and brown gas from October 1, 2020 to September 30, 2023 of $101/MMBtu, and average offtake, transportation charges and operating costs of $14.2 million. The chart is the Canadian dollar ("CAD") equivalent based on an average United States dollar to CAD exchange rate of 1.36. 3 The trailing 12 Month period demonstrates the revenue and EBITDA that GreenGas Colorado would have received based on the Company's estimated RNG production of 360,000 MMBtu per annum, the historical average pricing for LCFS, RIN and brown gas from October 1, 2022 to September 30, 2023 of $73/MMBtu, and average offtake, transportation charges and operating costs of $12.3 million. The chart is the Canadian dollar ("CAD") equivalent based on an average United States dollar to CAD exchange rate of 1.36. 4 The Q3 2023 period demonstrates the revenue and EBITDA that Green Gas Colorado would have received based on the Company's estimated RNG production of 360,000 MMBtu per annum, the historical average pricing for LCFS, RIN and brown gas for Q3 2023 of $81/MMBtu extrapolated for a full year, and average annual offtake, transportation charges and operating costs of $12.9 million. The chart is the Canadian dollar ("CAD") equivalent based on an average United States dollar to CAD exchange rate of 1.36. FUTURE ENERGY PARK Feedstock Future Energy Park has entered into a long-term supply agreement (the "Feedstock Contract") with a large creditworthy counterparty to purchase 750,000 tonnes annually of non-food grade wheat, which depending on starch content, is expected to supply all of the waste feedstock required for Future Energy Park on an annual basis. The Company has the option to purchase any additional wheat supply if needed, dependent on starch content, from the same supplier or other sources. The Feedstock Contract secures supply at market rates depending on the quality of the wheat. The Company estimates, based on an independent third-party forecast, average wheat supply costs of $190 million to $210 million annually over the first ten years of operation. FUTURE ENERGY PARK (continued) RNG The Company has progressed through the term sheet phase of its commercial process and is in the process of finalizing a definitive agreement for the sale of 100% of its RNG produced on a long-term basis to a highly creditworthy counterparty for a fixed price, with upside sharing on any environmental attributes expected to be generated by the Future Energy Park under any applicable provincial and federal carbon crediting programs. Under the agreement, the Company expects standard minimum supply requirements, subject to customary force majeure events. Based on anticipated run-rate production of approximately 4. million gigajoules per annum of RNG, the Company expects to receive approximately $120 million annually in revenue, resulting in approximately $100 million in EBITDA annually for the sale of its RNG after estimated transportation charges of approximately $5 million per annum, and the allocation of both direct and indirect operating expenses of approximately $15 million per annum. Approximately 90% of revenue is anticipated to be sold pursuant to a fixed price long-term contract. Emission Offset Credits As a result of the diversion from landfills for the stillage produced through the bioethanol fermentation process, the Future Energy Park is anticipated to produce up to 1.6 million tonnes per annum of emission offset credits, net of any compliance obligations, under the Technology Innovation and Emissions Reduction Regulation ("AB Tier"). Future Energy Park has entered into several agreements for the sale of these emission offset credits. 250,000 tonnes of equivalent emission offset credits will be sold to a large North American energy infrastructure company for an initial five-year term at a fixed discount to the Climate Change and Emissions Management Fund price established under the Alberta Climate Change and Emissions Management Act (the "Index Price”). An additional 100,000 tonnes of equivalent emission offset credits per annum have been contracted for an initial three-year term at a fixed discount to the Index Price to a Canadian-based commodity marketing company. This counterparty has also contracted any excess credits on an annual basis at the prevailing market price minus a marketing fee for such credits for a five (5) year term. The current Index Price is $65 per tonne and is set to increase annually by $15/tonne per year to a maximum of $170/tonne by 2030. Based on anticipated tonnes per annum, the terms disclosed above, and the initial expected Index Price, the Company expects to receive over $135 million annually in revenue, resulting in initial annual run-rate EBITDA for the sale of emission offset credits of approximately $125 million after the allocation of both direct and indirect operating expenses of approximately $10 million per annum. Under AB Tier, the majority of the emission offset credits have a 10-year life, with the potential to extend for an additional five years, subject to regulatory approval. [email protected] TSXV: GIP Green Impact Partners 25
View entire presentation