Greka Engineering & Technology Ltd Revised Customer Pricing (7678X)
16 January 2014 - 6:49PM
UK Regulatory
TIDMGEL
RNS Number : 7678X
Greka Engineering & Technology Ltd
16 January 2014
16 January 2014
GREKA ENGINEERING & TECHNOLOGY LTD
("Greka Engineering" or "the Company")
Increase in gas processing and electricity prices charged to
customers
Greka Engineering & Technology Ltd. (AIM: GEL), the
engineering, procurement, construction and management (EPCM)
Company which owns and operates infrastructure assets in China,
announces that the Company has agreed revised gas processing and
electricity prices with Green Dragon Gas Ltd. (AIM: GDG).
With effect from 1 January 2014, the prices of both PNG and CNG
processing are US$1.625/Mcf (RMB 0.35 per cubic meter) for the
first 3,530 Mcf (100,000 cubic meters) of gas processed per day,
reducing on a sliding scale to US$0.14/Mcf (RMB 0.03 per cubic
meter) for the volumes above 17,700 Mcf per day (500,000 cubic
meters). With effect from the same date, the electricity price
increases to US$0.197 per kilowatt-hour (RMB 1.2 per kilowatt-hour)
for the first 30,000 kilowatt-hour consumed per day, reducing on a
sliding scale to US$0.008 per kilowatt-hour (RMB 0.05 per
kilowatt-hour) for the volume above 150,000 kilowatt-hour.
Previously, the prices charged by the Company for piped natural
gas (PNG) and compressed natural gas (CNG) processing were
US$0.37/Mcf (RMB 0.08 per cubic meter) and US$0.84/Mcf (RMB 0.18
per cubic meter) respectively, and the electricity price was
US$0.105 per kilowatt-hour (RMB 0.64 per kilowatt-hour).
In Q3 2013, the Company processed average daily volumes of 1,864
Mcf (52,792 cubic meters) of PNG and 1,070 Mcf (30,305 cubic
meters) of CNG, and supplied Green Dragon Gas Ltd. with an average
of 20,759 kilowatt-hours per day.
Under the new contract, at 17,700 Mcf per day (500,000 cubic
meters) processed and under the assumption of an equal split
between PNG and CNG, the weighted average price would increase from
US$0.60/Mcf (RMB 0.13 per cubic meter) to US$0.715/Mcf (RMB 0.154
per cubic meter), a 18.5% increase.
Randeep S. Grewal, Executive Chairman of Greka Engineering,
commented:
"This pricing structure is designed to enable Greka Engineering
to cover processing costs at lower levels of activity whilst
incentivising both customer and processor to maximise volumes
thereby increasing margins to the mutual benefit of both companies.
Our strategy is to replicate this type of contract with other
customers, allowing the customer to simply concentrate on
developing and selling the resource."
For more information of Greka Engineering, please visit the
company website at www.grekaengineering.com.
Contacts:
Greka Engineering
Randeep Grewal +852 3710 0168
Smith & Williamson
Nominated Adviser
Dr Azhic Basirov / David Jones /
Ben Jeynes +44 20 7131 4000
RFC Ambrian
Broker
Sarah Wharry +44 20 3440 6800
WH Ireland
Broker
Tim Feather +44 113 394 6600
Walbrook + 44 20 7933 8780
Media & Investor Relations get@walbrookpr.com
Paul McManus / Guy McDougall
About Greka Engineering & Technology
Greka Engineering & Technology Ltd., (AIM; GEL) demerged
from Green Dragon Gas (AIM; GDG) via a dividend in specie in
September 2013 on AIM.
Greka Engineering offers turnkey solutions to over 90 upstream,
midstream and downstream gas suppliers. The Company's technologies
include Compressed Natural Gas/Liquefied Natural Gas (CNG/NLG)
compressor equipment, CNG retail dispenser equipment and CBM
wellhead extraction technologies. The company also supplies
proprietary Integrated Circuit Card Point of Sale (ICC POS) and
Supervisory Control and Data Acquisition (SCADA) software and
hardware solutions for the remote management of transmission
systems, power facilities, vehicle management and retail
services.
To date, the Company has completed several Engineering,
Procurement, Construction and Management (EPCM) contracts including
the design, construction and management of gas gathering systems, a
gas pipeline in Shanxi Province to the China West-East pipeline,
the installation and commissioning of a 10MW gas-fired power
facility in the Shanxi province and the construction of CNG retail
stations.
Going forward, the Company's stated business model is to invest,
operate and maintain wholly owned assets for its customers in
return for service contracts based on the volume management. This
Intellectual Property (IP) led business model, combined with high
levels of recurring revenue, is expected to generate greater
returns for shareholders than the historical EPCM projects
completed to date.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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