Fusion Fuel signs heads of terms with Alien Energy for biomass project

DUBLIN - Fusion Fuel Green PLC (NASDAQ:HTOO), a green energy company with a market capitalization of $7.37 million and impressive revenue growth of 106% over the last twelve months, announced Monday it has executed a Heads of Terms with South Africa-based Alien Energy to establish a joint venture for a biomass-powered steam energy project at a dairy processing facility in South Africa. According to InvestingPro analysis, the company appears undervalued at its current price of $4.07.

The planned joint venture aims to replace fossil-fuel-based steam generation systems with a carbon-neutral biomass solution at a facility owned by a global multinational food and beverage company. According to the press release, Fusion Fuel will hold a 51% stake in the joint venture, with Alien Energy holding the remaining 49%. While analysts forecast 43.55% revenue growth for the current year, InvestingPro data reveals the company faces significant cash burn challenges, with 12 additional key insights available to subscribers.

Under the agreement, Fusion Fuel plans to invest approximately €480,000 (ZAR 10 million) to fund construction and commissioning of the plant. The project is expected to generate recurring annual revenues through a long-term steam supply agreement with the client, which could help improve the company’s current WEAK financial health score, as indicated by comprehensive InvestingPro Research Reports available for over 1,400 US stocks.

The joint venture also anticipates generating carbon credits from verified emissions reductions through landfill avoidance and fuel-switching benefits.

"The Heads of Terms represents another step forward in our strategy to deliver scalable, high-impact decarbonization and energy-related projects," said John-Paul Backwell, CEO of Fusion Fuel, in the statement.

The transaction is intended to close on or before October 1, 2025, subject to execution of definitive agreements and completion of closing conditions. Project commissioning is targeted to commence around the end of this year.

Fusion Fuel Green provides integrated energy engineering, distribution, and green hydrogen solutions through its platforms. Alien Energy supplies industrial steam systems powered by a proprietary carbon-neutral biomass fuel derived from wood waste and invasive vegetation.

In other recent news, Fusion Fuel Green PLC has announced several significant developments. The company reported that its majority-owned subsidiary, Al Shola Al Modea Gas Distribution LLC, secured multiple contracts for liquefied petroleum gas (LPG) systems in Dubai, with the largest projects valued at over AED 1.9 million (approximately $517,000). Additionally, Fusion Fuel received the first payment of €370,100 from the sale of its 50% equity stake in P2X Spain Sociedad Limitada. This payment is part of a total expected sum of €515,100 from the transaction with EREE Desarrollos Empresariales, S.L.

Fusion Fuel also shared that it has regained full compliance with Nasdaq listing requirements, following confirmation from the Nasdaq Hearings Panel. Furthermore, the company signed a non-binding Letter of Intent to form a joint venture with a South African specialized fuel company, aiming for a 51% controlling stake in a new project. These recent developments reflect Fusion Fuel’s ongoing efforts to expand its operations and maintain regulatory compliance.

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