ATOME granted Free-Trade Zone for Villeta Project
14 November 2023
ATOME ENERGY PLC
("ATOME", "the Company", or "the Group")
ATOME granted Free-Trade Zone for Villeta Project, Paraguay
ATOME Energy (AIM: ATOM) ("ATOME"), the only international green fertiliser project development company on the London Stock Exchange, is pleased to announce that its 145MW Villeta Project in Paraguay has been granted Free-Trade Zone status by Presidential decree bringing significant financial benefits to the project and its funders.
Highlights:
· Free-Trade Zone ("FTZ") status granted by Presidential decree to ATOME's Villeta Project, Paraguay
· Only the sixth FTZ granted by Paraguay
· ATOME will benefit from exemptions on municipal, VAT, and corporate income taxes
· Clearly demonstrates the Paraguay Government support and commitment to ATOME's Villeta Project
· Paraguay country ceiling has been upgraded to BBB- in the latest Fitch Ratings report
Free-Trade Zone
ATOME is pleased to announce that the Presidential decree has been signed now granting the Villeta Project full FTZ status. This is only the sixth FTZ in Paraguay and as a result will grant ATOME with the following benefits which materially enhance the economics of the Villeta Project:
· Exemption from VAT on:
o Sales of goods and services from Paraguay to the FTZ
o Import of equipment and services
o Services provided by the concessionaire to FTZ
· 3% effective corporate income tax ("CIT") on profit derived from domestic sales to Paraguay
· 0.5% Free Trade Zone tax on revenue from export sales, no CIT
· Exemption from CIT and/or withholding taxes including on:
o Remittance of profits or dividends by FTZ users to third countries
o All payments of fees, commissions, interest, and all other remuneration on all services, including financing, provided from third party countries to FTZ Users
· Exemptions from local and municipal taxes and charges
Strong government backing for ATOME's projects
This is an unequivocable demonstration of government support for ATOME's Villeta Project and its determination to make the project a success both for ATOME and Paraguay's ambition in being a world leader in green fertiliser production. This support has been key in relation to the granting of the FTZ and the Environmental Licence, having expeditiously passed all necessary inter-governmental approvals, which are important milestones towards project financing and construction of the Villeta facility.
Paraguay Economic performance and growth aspirations
Paraguay has political and economic stability and one of the best performing economies in Latin America, with inflation falling sharply this year to 3% (as of October 2023) and economic growth expected by Fitch to rebound by 5.2% in 2023. The latest Fitch Ratings report affirmed Paraguay's stable outlook at a BB+ credit rating, one mark short of investment grade, whilst raising the country ceiling to BBB-.
Peter Levine, Chair, commented:
"Through successive administrations it has been both consistently crystal clear that Paraguay is open for business and encourages and supports serious foreign investors and investments.
"We are greatly honoured by President Peña by his signing of the decree for the tax-free zone in Villeta and we are grateful for the support and trust he and his Ministers have given to us in this important landmark project for the country of Paraguay."
For more information, please visit https://www.atomeplc.com or contact:
|
ATOME Energy PLC |
+44 (0) 113 337 2210 |
|
Beaumont Cornish (Nominated Adviser) |
+44 (0) 20 7628 3396 |
|
Liberum (Joint Broker) |
+44 (0) 20 3100 2000 |
|
SP Angel (Joint Broker) |
+44 (0) 20 3490 0470 |
|
Cavendish Capital Markets Limited (Broker) |
+44 (0) 20 7220 0500 |
|
Tavistock (Financial PR and IR) |
+44 (0) 20 7920 3150 |
The information communicated within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No 596/2014 which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. Upon publication of this announcement, this inside information is now considered to be in the public domain. The person who arranged for the release of this announcement on behalf of the Company was Peter Levine, Chairman.
About ATOME
ATOME Energy PLC is an AIM listed company targeting green fertiliser production with 445-megawatt of projects in Paraguay and a further pipeline of potential projects in Central America and Iceland.
Since its admission to AIM in December 2021 ATOME signed a 145MW power purchase agreement with ANDE, the state energy company in Paraguay for acquired 30 hectares of land in Villeta, Paraguay for that facility, mandated Natixis Corporate & Investment Banking and the multilateral IDB Invest to lead the project funding and with Front End Engineering and Design studies currently underway with the international companies Urbas and Casale. ANDE has also allocated a further 300MW for ATOME's second project subject to studies.
In Costa Rica, ATOME has a green fertiliser joint venture with Cavendish, the renewable energy arm of the substantial and well-established Purdy Group based in Costa Rica and formed The National Ammonia Corporation S.A. As well as straddling the Pacific and Atlantic Oceans, Costa Rica is a democratic Central American country. In agriculture, Costa Rica is the second largest supplier of pineapples in the world and is in the top ten banana growers.
ATOME is in the process of operational planning, sourcing and negotiations with green electricity suppliers, equipment providers and offtake partners, including signed memoranda of understanding and cooperation agreements in place with key parties, to produce green ammonia at an industrial scale using electricity generated from existing geothermal sources in Iceland and hydroelectric power in Paraguay and Costa Rica. All chosen sites are located close to the power and water sources and export facilities to serve significant domestic and then international demand.
The Company has a green-focused Board which is supported by major shareholders including Peter Levine, Trafigura, one of the world's leading commodity and logistics company, and Schroders, a leading fund manager, and since May 2023, Baker Hughes, a global energy technology company operating in the energy and industry sectors.
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