For Immediate Release
Vancouver, B.C. – January 25, 2021 – Oceanic Wind Energy Inc. (TSX-V: NKW) (“Oceanic” or “Company”) today announced its financial results for the year ended September 30, 2020, a fiscal period during which the Company successfully completed the sale of the Offshore Wind Farm located in the Hecate Strait off the coast of British Columbia, Canada (the “Project”) to Northland Power Inc. (TSX: NPI) (“Northland”), a global developer, owner and operator of sustainable infrastructure assets with expertise and capacity to advance early stage renewable energy projects to the next level of development (the “Transaction”). With the successful completion of the Transaction, Northland is responsible for all aspects of the Project’s development. The Transaction occurred by way of the Company selling Northland a 100% interest in its wholly owned subsidiary, NaiKun Wind Development Inc.
On March 27, 2020, Oceanic announced the signing of an agreement to sell the Offshore Wind Project in Hecate Strait to Northland.
On May 15, 2020, an AGM and Special Shareholders Meeting was held to provide all shareholders the opportunity to vote on the signed agreements, to vote on the name change to Oceanic Wind Energy Inc and to conduct the regular AGM business. At the meeting the shareholders approved, with a vote of 99% of voted shares, the sale of the Project to Northland by selling them NaiKun Wind Development Inc. Additionally, the shareholders approved, with a vote of 99% of voted shares, the name change of the Company to Oceanic Wind Energy Inc.
Pursuant to the terms of the Agreement, the Company has the right to receive the following:
- upon the project reaching its financial close, as defined in the Agreements, a payment based on the size of the developed project ($67,500 per installed megawatt (“MW”) to a maximum of $33,750,000), which is expected to be equal to the majority of the Company’s historical development costs on the project (the “Cash Consideration”);
- upon the project becoming operational, future payments consisting of 35% of annual cash distributions from the project after the operating costs and a specified return on equity have been recovered by Northland (the “Cash Distribution”); and
- subject to financial close of the project, an option to purchase up to a 10% interest in Northland’s interest in their project (the “Option”).
The terms of the Transaction can be found on SEDAR or the Company’s web site www.oceanicwind.ca.
An overview of Oceanic Wind’s year-end results includes:
- As at September 30, 2020, Oceanic Wind had $51,820 in cash and cash equivalents, compared to $232,937 at September 30, 2019.
- For the fiscal year ended September 30, 2020, Oceanic Wind incurred a net loss of $0.56 million ($0.01 per share), compared to $1.26 million ($0.02 per share) for the year ended September 30, 2019.
The wind project is the only project of significant utility scale in the region and with the remarkable advances in offshore wind development, the project is both affordable and competitive to help meet the long-term electricity needs of British Columbia. With Northland as the developer, the need for renewable energy to power BC’s future, and the strong support from the federal government to reduce GHG to support Climate Change commitments, Oceanic remains optimistic the project will be developed in the near future.
Caution Regarding Forward-Looking Statements – This news release contains certain forward-looking statements, including statements regarding the business and anticipated financial performance of the Company. These statements are subject to several risks and uncertainties. Actual results may differ materially from results contemplated by the forward-looking statements. When relying on forward-looking statements to make decisions, investors and others should carefully consider the foregoing factors and other uncertainties and should not place undue reliance on such forward-looking statements. The Company does not undertake to update any forward-looking statements, oral or written, made by itself or on its behalf.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
For further information please contact:
Michael O’Connor, President & CEO
Oceanic Wind Energy Inc.