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Re: Carnegie announcement

01 February 2010

Please find below the Report to Shareholders for the Quarter Ended 31 December 2009 released on 29 January 2010 by Carnegie Wave Energy Limited, in which REH holds 232,600,000 fully paid ordinary shares:

 

“29 January 2010

Report to Shareholders for the Quarter Ended

31st December 2009

 

ACTIVITIES SUMMARY

 

During the quarter, wave energy developer Carnegie Wave Energy Limited (ASX: CWE) commenced offshore installation activities for its Perth Wave Energy project and continued to progress the development of its CETO wave energy technology.  The Company also completed a successful capital raising.

 

1.                  CETO Wave Energy Technology Development

 

During the quarter Carnegie deployed a scale CETO 3 unit at its Fremantle Wave Energy Research Facility.  Importantly, the functional performance of this CETO 3 device has been designed to mimic the full scale CETO 3 unit scheduled for deployment off Garden Island later in 2010.  The deployment comprised a full suite of instrumentation, control and hydraulic equipment and Carnegie’s unique energy relief buoyant actuator (ERBA).  The objective of the deployment was to provide operational design information for the full scale unit deployment.  The deployment provided consistent data through a range of sea states over a number of weeks.

 

High cycle test activites of key CETO 3 components have continued throughout the quarter with cycles on some key components now exceeding 5 million cycles or the equivalent of multiple years of real operation.  This high cycle test work is providing invaluable service life performance data to verify the expected performance of the full scale system.

 

Final design for the major CETO 3 components for the single unit deployment in the waters to the west of Garden Island, Western Australia are now well advanced.  Manufacture of CETO 3 components is also advancing well.  The major works associated with the foundation installation for the full scale deployment are now complete with the jack up rig (JUP), now off site.  Final completion works on the foundation are now underway.

 

As previously described, the CETO 3 single unit deployment will consist of a single CETO unit, hydraulic energy dissipation system and instrumentation buoy.  The hydraulic system and instrument buoy avoid the requirement for a physical connection to shore for the initial single unit installation.

 

 

 

 

2.                  CETO Wave Energy Commercial Opportunities

 

Carnegie continued to progress a number of commercial opportunities for CETO wave energy during the quarter:

 

  • On 18 January 2010 the Western Australian Minister for Energy the Honourable Peter Collier officially launched the Perth Wave Energy Project at Carnegie’s Wave Energy Research Facility in Fremantle, Western Australia.  The project has a commitment from the Western Australian State Government to provide $12.5m of funding from the State’s Low Emissions Energy Development (“LEED”) fund for the project.  Stage one of the project, which has already commenced, involves the deployment of a single stand alone commercial scale CETO unit off Garden Island in 2010.  The deployed system will consist of the mooring, a CETO unit and a data telemetry buoy.  Deployment of the CETO unit will be for an initial period of up to 12 months involving periodic inspection and maintenance of components.  This will be the first commercial scale wave energy unit to be deployed in Australia.

 

  • During the quarter Carnegie completed a study for the Commonwealth of Australia, via the Department of Defence (DoD), to assess the feasibility of utilising the CETO wave energy technology to supply power to the Defence Communications Station Harold E Holt (HEH) at Exmouth in the North West of Western Australia.  The feasibility assessment looked at a variety of factors including wave resource, environmental values, geotechnical and geophysical conditions and connectivity to the remote HEH power system.

 

  • On 7 December 2009 Carnegie advised that it had executed a deed of licence with the State of Western Australian Government for access to a designated area of seabed waters to the west of Garden Island off Perth, Western Australia.  Carnegie had been working with the Department of Regional Development and Lands (DRDL) who manage Crown Land in Western Australia, along with other State Government Departments, to process Carnegie’s license application over a number of months.  Execution of the licence provided Carnegie with permission, subject to specific covenants, to install and operate a commercial scale, autonomous CETO wave energy device to verify its energy delivery performance for a period of up to 3 years.

 

3.                  Corporate Activities

 

Carnegie executed the formal CETO Collaboration and Licensing Agreement with Northern Hemisphere Development partner EDF EN.  The signing of the license was the final step in the purchase process of the CETO intellectual property and global development rights by Carnegie paving the way for joint development of commercial CETO projects throughout the Northern Hemisphere and Reunion Island.  Carnegie retains the right to own up to 49% of each project and each project will pay Carnegie a license fee for the use of the CETO technology.

 

During the Quarter Carnegie was pleased to complete a $8.9m capital raise.  This consisted of heavily oversubscribed Share Purchase Plan (“SPP”) that raised $5.4 million and a $3.5 million Share Placement to mostly European, American and Australian institutions.  Carnegie had previously announced that it anticipated raising up to $2.5 million through its SPP however, Carnegie’s Board of Directors decided to accept over subscriptions to allow all subscribing investors to participate.  Funds raised from the Placement and the SPP will be applied towards deployment and testing of commercial-scale CETO Wave Energy units in the waters off Perth, Western Australia, as well as international site development activities and for general working capital requirements.

 

About CETO

 

The CETO system distinguishes itself from other wave energy devices by operating out of sight and being anchored to the ocean floor.  An array of submerged buoys is tethered to seabed pump units.  The buoys move in harmony with the motion of the passing waves, driving the pumps which in turn pressurise water that is delivered ashore via a pipeline.

 

High-pressure water is used to drive hydroelectric turbines, generating zero-emission electricity.  The high-pressure water can also be used to supply a reverse osmosis desalination plant, replacing greenhouse gas emitting electrically driven pumps usually required for such plants.

 

CETO Technology characteristics include:

 

  • CETO converts wave energy into zero-emission electricity and desalination water
  • CETO is environmentally friendly, has no visual impact and attracts marine life
  • CETO is fully submerged in deep water away from popular surf breaks and where it is safer from storms.”

 

- Ends -

 

For further information, please contact:

 

Renewable Energy Holdings plc

Mike Proffitt, Chief Executive

 

Tel: +44 (0) 16 2464 1199                                

Strand Hanson Limited

Rory Murphy / James Spinney

 

Tel: +44 (0) 20 7409 3494

Novus Capital Markets Ltd

Charles Goodfellow / Paul Dudley

 

Tel: +44 (0) 20 7107 1872

Financial Dynamics

Billy Clegg / Ed Westropp / Alex Beagley

Tel: +44 (0) 20 7831 3113