Denmark - Environmental services - Joint Development Agreement

HOFOR CC HOLDING A/S (“HOFOR”) has decided to pursue a BECCS project to capture carbon dioxide from the flue gas from the combined heat and power plant unit 4 (AMV4), which includes the design, construction, operation and ownership of a carbon capture facility on the property at or adjacent to Amagerværket, and the development and management of the related upstream and downstream value chain activities on arms-length commercial terms with a view of undertaking the BECCS project with or without a joint venture partner ("Project"); In this respect HOFOR intends to enter into a joint development agreement with Carbon Removals Denmark A/S, a company forming part of the wider Elimini group, as the basis upon which the parties will continue to evaluate the Project setting out the basis for the development and maturation of the potential Project and, subject to approval by the parties, entry into the definitive agreements and potential formation of a joint venture. For that purpose the agreement sets out a framework for the detailed evaluation and development of the Project through the preparation, negotiation, and execution of the definitive agreements; and setting forth the terms and conditions upon which the Parties shall conduct exclusive negotiations with respect to the Project and the consequences should a Party elect to withdraw from the implementation of the Project. HOFOR and Carbon Removals Demark A/S intend, subject to relevant approvals, for the Project to be developed using a special purpose vehicle (the “Project SPV”), with HOFOR having a controlling interest in the Project SPV. The parties intend for the Project SPV to be the relevant counterparty in respect of all contracts with suppliers and contractors entered into for the Project. The joint development agreement is expected to commence after signing and will continue until terminated by either party. The joint development agreement relates to the participation by HOFOR, through its subsidiary HOFOR DSS SPV A/S, in the Danish Energy Agency's CCS-subsidy tender, cf. Contract Notice No. 604064-2024 of 8 October 2024. As the agreement relates to joint development of the Project, both HOFOR CC HOLDING A/S and Carbon Removals Denmark A/S will be incurring expenditures in progressing project development, but neither party will (except potentially in certain termination scenarios) be making any payments to each other. Each of HOFOR CC HOLDING A/S and Carbon Removals Denmark A/S will provide internal resources and, except in certain termination scenarios, bear their own respective internal costs incurred in developing the Project. Any external project development costs will be split between and borne by each of HOFOR CC HOLDING A/S Carbon Removals Denmark A/S in accordance with their respective participating interest in the Project (subject to certain termination scenarios). If the joint development agreement is terminated for whatever reason, HOFOR shall have the right to continue the development and advancement of the Project alone or together with another third party at its sole cost, risk and discretion subject to the requirement for HOFOR to compensate Carbon Removals Denmark A/S in certain circumstances for its agreed costs of participating in the joint development of the Project up until the termination.