Ann: KALiNA Provides Update on Alberta Projects, page-37

Wow, I believe the market really has read this announcement wrong. It is fixated upon a delay in FNTP on the first project by a few months and completely ignored the scale up that is now being finally revealed.

We are in our little Australian bubble that is effectively COVID free and make no allowance for the fact that other parts of the world are finally moving forward on a very significant problem. A couple of months delay from an administrative department around our environmental approvals because of COVID...honestly? I've seen some of these on mining projects blow out by years! What is a few months??

Particularly when we have now been told that KDP have 320MW under development....not a dreamy pipeline, but sites that have had extensive work put in to them so they are now at various stages of working through the approvals process such that they can sequence in nicely behind the primary site. We have been told in this announcement that this equates to nearly $1Billion dollars of projects! @Starrr reminded us the other day even from the early days the projects generate double digit returns on investment. And since then we have had various improvements such as increase to 50% energy return from KALiNA Cycle, modularisation, increase in energy output of plants, doubling the size of the sites to 2x32MW. All of these we have been told lead to improvements in the project returns. So we must be looking at some really good double digit returns now. Dare we dream these approaching 15-20%

Now those sorts of returns on $1Billion investment is some serious coin for a company with a MC of under $50M as of now. That is massively oversold in my language and despite having all my boots filled I'll probably grab a bit more. These are the times when you back your research and don't get scared in a flush out. Reality is the volumes on the way down have been tiny. A few scared sellers and unfortunately no buyers at the moment willing to back themselves.

I expect that to change but for now that creates opportunity.

A final word on the DG Credits. We have been told that management who have been talking with the AUC are supremely confident these will be retained. In my mind, how could they not. Much of the renewable energy space is relying on its small scale. Alberta is retiring a hell of a lot of coal fired power over the remainder of the decade. They can't afford to have the renewable energy sector fall off a cliff. And if it did, the price of energy is going to sky-rocket as baseload comes out of the system with planned retirements. In which case in that unlikely event, we just start merchant selling our energy from the 64MW combined cycle plants and our margins go up even further due to the higher than expecting price of electricity.