Novera Energy Chairman, Dr Don Stammer, said the company sold its rights to the Arpley landfill gas site to WRG for $11.5 million, consistent with the current carrying value of the contracts.

“Cash proceeds from the sale will support Novera’s 14.5 MW Mynydd Clogau wind farm project in Wales, planned for commissioning in 2005,” Dr Stammer said.

“When acquired in 2002, Novera Energy inherited commercial arrangements for Arpley that proved difficult to operate given the complexities of the site arrangement and in particular volatility of gas yields from the site.

“Novera Energy has elected to re-allocate its capital from Arpley to the Mynydd Clogau wind farm project (project value $40 million), thereby achieving a strengthening in the company’s overall return on assets.”

Novera Energy has subsequently completed an agreement with the RED Group of Scotland to co-develop up to 260 MW of potential wind farm projects at a number of sites in the UK.

All of the proposed sites have good access to grid connections, are free from any material environmental and aviation constraints, have good transport access and are in locations where planning approvals have achieved the highest success rates in the UK.

Under the agreement with the RED Group, Novera Energy Europe will hold a majority interest in all selected projects and have first right to all future projects identified by the RED Group as their site prospecting continues.

“We have been working hard to secure a significant growth platform in small to medium scale wind energy in the UK to leverage our first wind investment in Mynydd Clogau,” Novera Energy Europe CEO, David Scaysbrook, said.

Novera’s management in Europe is also currently focused on a number of opportunities that may develop in a shorter timescale than previously envisaged. In light of these new investment opportunities and the cash proceeds from the Arpley sale, the IPO of Novera’s European subsidiary is being rescheduled for later in the year, in order to allow management to focus on these opportunities, which may enhance the IPO in the interests of shareholders.

“The UK has set a target for renewable energy sources to contribute 15.4% of total electricity use by 2015. In contrast, the Australian Government – after a two-year review of the Mandatory Renewable Energy Target – has deflated local investment prospects and left unchanged the goal for renewable energy to produce less than 2% of electricity used in this country,” Dr Stammer said.

“This week’s announcement by the Federal Government of limited assistance to the renewable energy sector in Australia, particularly in relation to wind and landfill gas, demonstrates that the company’s strategy of developing and restructuring its portfolio assets in the UK is correct and in the best interest of all shareholders.

Excluding the Arpley site, Novera Energy now operates 31.3 MW of landfill gas power plants at 12 sites across the UK. Ranging from 6 MW to 0.3 MW, the reliable performance of these sites is typical of the standard in the landfill gas power industry. The company expects to commission, as a minimum, a further 2 MW by the final quarter of 2004, a further 3 MW in the first quarter of 2005, and has several new sites under active negotiation.