Panang Titanium is a new Enersize customer and the agreement has been entered directly as a profit sharing agreement without prior installation agreement. The plant has an installed compressor capacity of around 2MW and an annual consumption of approximately 12,000 MWh. Estimated savings are 20%, possibly even higher.
The profit sharing agreement agreement has been closed with Enersize Shanghai-based Chinese partner Venergy. Venergy has the option to participate in some parts of the project financing, which may affect the distribution between Enersize and Venergy to a lesser extent. Enersize’s profit share of total savings during the contract period is estimated at about 45%.
The agreement is structured as a framework agreement where the implementation of certain savings measures is conditional pending approval by the end customer. This can affect eventual achieved savings. Enersize’s share of the savings is the same for all six (6) contract years. The six-year profit sharing period begins when savings reach 10% and the agreement is conditional on a saving of at least 15%.
Pangang Titanium is one of China's largest manufacturers of titanium oxide for use as color pigments. Pangang Titanium was previously listed on the Shenzhen Stock Exchange but is now part of state-owned Panzhihua Iron & Steel Group (Pangang Group). Pangang Group has a number of business areas in mining and metal, refining China's largest conglomerate of vanadium and titanium production, and one of China's largest steel producers.
Enersize will utilize its new patent-pending automated analysis as an essential part of the efficiency enhancement work. Installation is scheduled for completion in Q3 2018 and the efficiency improvement actions are expected to commence as soon as sufficient data has been collected.
Christian Merheim, Chairman of the Board Enersize, comments:
"In 2018, we invested directly in profit sharing agreements with new customers. It has meant some longer negotiation cycles, but at the same time it means lower risks to us and we also expect that in this way, the crucial profit-sharing phases will be faster. Building this kind of business is an ongoing learning experience for the organization, where better organization and implementation will provide shorter lead times and better results. Something that ultimately turns into a competitive advantage.”
Sami Mykkänen, CEO Enersize, comments:
"As one of China's largest steel producers, Pangang Group is well-known throughout China, and we are very pleased to announce this contract with one of their business areas.
The metal industry in China is a classic major consumer of compressed air with good optimization capabilities. With this factory, we have gained a foothold in one of China's absolute largest metal processing companies. We have also managed to get a long contract with a full six-year profit sharing in open competition with other energy saving service providers."
For more information about Enersize, please contact:
Christian Merheim, Executive-Chairman of the Board
Phone: +46 (0) 708-182 853
Or (English only):
Sami Mykkänen, CEO
Tel: +358 405 59 90 47
This is an unofficial translation of earlier disseminated regulatory news in Swedish. For any discrepancies in the text we refer to the Swedish version.