ALTER NRG REPORTS FIRST QUARTER 2011 ACTIVITIES AND FINANCIAL RESULTS

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OTCQX - ANRGF

CALGARY, June 13, 2011 /CNW/ - (TSX - NRG; OTCQX - ANRGF) - Alter NRG Corp., ("Alter NRG" or the "Corporation") is pleased to report on its corporate activities and financial results for the three month period ended March 31, 2011.

Q1 HIGHLIGHTS

Alter NRG provides clean and renewable energy solutions that are economically viable and environmentally sustainable.  It operates two wholly owned subsidiaries which are both positioned for significant near-term growth:

Westinghouse Plasma Corp. ("Westinghouse Plasma") - the industry leading plasma gasification technology that provides clean and renewable energy solutions by converting all types of waste and biomass into high value energy - like electricity, ethanol or syngas for industrial use. With plasma systems in operation for 20 years and converting waste into energy since 2002, this technology is commercially proven and has lower emissions than conventional energy technologies.

Clean Energy Developments ("CleanEnergy") - the Canadian industry leading geoexchange company that provides heating and cooling for homes and commercial buildings using energy from the earth.  This is a solution that is used extensively in Europe as it reduces the use of fossil fuels for heating and cooling by up to 80%.  In a highly fragmented Canadian market, CleanEnergy provides complete design and build solutions for commercial projects and also equipment sales through its dealer network across Canada.

Fox Creek Coal Assets ("Fox Creek") - Alter NRG has acquired one of the largest contiguous deposits of surface mineable coal, available in Western Canada (847 million tonnes). With existing infrastructure and access to rail and ports, the Fox Creek Coal can help fulfill the increasing demand for coal in Asia.

Alter NRG is pleased to be presenting highlights for its first quarter of 2011 as revenues have increased by 41% over the prior year.  This is reflective of a maturing business plan with significant long-term potential.

Westinghouse Plasma

  • Advanced over 30 projects located worldwide which are in the engineering stage of the project development with a total sales value of over $500 million upon successful development. The Westinghouse Plasma technology has been selected in a total of over 60 proposed projects being advanced worldwide that are in active project development by numerous industry leading companies.

  • Air Products, a US based Fortune 500 company, finalized detailed engineering for the plasma portion of the project for approximately US$1.2 million.  The project is called the Tees Valley project in Northern England which will take 950 tonnes per day of processed household waste and convert it into 49 MW of electricity, enough to power over 50,000 homes. The project has commenced its formal planning and regulatory process and is expected to begin construction in late 2011.  This project represents approximately a US$30 million sale depending upon final scope.

  • The St. Lucie County project is furthering the engineering for a 650 tonne per day waste-to-energy project in Florida expecting to produce 24 Megawatts of electricity.    This project represents approximately a $20 million engineering and equipment sale.

  • NRG Energy, a licensor of the Westinghouse Plasma technology, expanded its portfolio of US based plasma projects to over 20 projects.  This includes a project in New Jersey which has filed for its regulatory approval, and is advancing engineering.

  • Continued to provide syngas to Coskata, Inc. (Coskata) at the Westinghouse Plasma Centre in Pennsylvania.  Coskata has a proprietary syngas to ethanol conversion technology that is using the Westinghouse Plasma technology to create syngas from biomass and waste.   The Coskata technology has been chosen for a waste to ethanol project in Australia that is being advanced and is expected to be a $50 million technology sale upon successful development.

  • Advanced the detailed engineering and construction of a demonstration facility under development by Wuhan Kaidi ("Kaidi") in the Wuhan province of China.   Upon successful demonstration, Kaidi has up to 150 biomass-to-energy projects which they expect to develop in the Central China market over the next 10 years using the Westinghouse Plasma technology.  The revenue to Westinghouse Plasma is expected to be US$3 to US$10 million per facility.

  • Advanced the detailed engineering and construction of a second demonstration facility in Shanghai which will be integrated with an existing incinerator to take the incinerator ash as well as other harder to handle feedstocks.  Upon successful demonstration, the revenue to Westinghouse Plasma is expected to be US$5 to US$10 million per additional facility.

  • Advanced the second phase of initial engineering on a project in Minnesota being developed by the Koochiching Development Authority. The proposed project which is to be located in Koochiching County in Northern Minnesota is called the Renewable Energy Clean Air Project. This results in an approximate US$12 million dollar technology sale which is expected in 2012 as well as site licenses and engineering revenues in 2011.

  • Announced a sale for US$1.9 million of Westinghouse Plasma torches to be used for metals recycling.  The plasma torch market represents a shorter sales cycle and the Company is actively working with other customers for potential plasma torch opportunities in 2011.

  • Signed a license agreement in Australia and New Zealand with Moltoni Energy for $5.75 million payable in increments over 5 years.  Moltoni Energy is a private development company with experience in both waste and large power facilities and have a dozen planned energy from waste projects in the region.

  • Began the regulatory process for the Dufferin County energy from waste project, an approximate 6.5 MW facility.

CleanEnergy

  • Sales of $1.1 million for the quarter.  CleanEnergy has executed on larger scale projects in the first quarter of 2011 and successfully positioned itself to be the industry leading commercial geoexchange company focused on larger jobs from $0.5 million to $2.0 million and growing.  Our strengthening reputation has expanded the backlog of sales to over $8.0 million with a strong pipeline of opportunities.

  • Began construction on a geoexchange installation in Truro, Nova Scotia for $2.05 million to complete the Central Nova Scotia Civic Centre for all aspects of the building including, making ice for the rink, heating the pool and heating and cooling the buildings. This facility will feature a NHL-sized ice surface with seating for 3,200 spectators. It will also be home to an indoor aquatic centre, an exercise track, a fitness centre, and space for events like concerts, tradeshows and community gatherings.

  • Began construction on a state of the art mental hospital in Ontario for $1.5 million.  Mental Health Centre Penetanguishene aims to achieve Leadership in Energy and Environmental Design (LEED®) Gold certification for the design and construction of the new facility. CleanEnergy's geoexchange system will help the Health Centre achieve the necessary points to reach a LEED® Gold certification.

  • Secured a $450,000 purchase order to provide geoexchange heating and cooling solutions for a 72 unit senior's affordable living complex in London, Ontario.

  • Completed $975,000 of drilling as part of a geoexchange solution which provides the complete heating, cooling and ice making for a hockey rink and sports complex in Fredericton, New Brunswick.

  • Completed an elementary school in Kelowna, British Columbia for approximately $600,000, which is the first of many schools in BC that are focusing on going green and reducing their carbon footprint using geoexchange.

  • Added a tier one Canadian bank as a partner to provide financing for the complete geoexchange system for commercial and municipal customers.

  • Expanded our dealer network across Canada to 109 dealers to which CleanEnergy distributes the Waterfurnace manufactured Geostar branded heat pumps exclusively in Western and Central Canada.   The dealer network sells geoexchange solution to the residential market.

Fox Creek Coal

  • Announced the heating content of the Fox Creek coal would be 4,944 kcal/kg (8,900 Btu/lb) on a wash basis, which is similar quality to the North American Powder River Basin coal.  The Fox Creek coal asset is 847 million tonnes of measured and indicated coal resource located near Fox Creek, Alberta.    This is one of the largest exportable thermal coal resources in the developed world.  Recently, thermal coal demand internationally, particularly in Asia, has increased, which has resulted in higher thermal coal prices.  The Fox Creek Coal has access to rail lines and a port that are expected to have capacity to take the coal to export markets.

Corporate

  • Announced a strategic process with Robert W. Baird to maximize value of our three assets which could include joint ventures, minority investment or outright sale of the assets individually or combined.

  • Sold non-core assets for cash proceeds of $2.1 million.

  • Announced a $20 million Committed Equity Facility provided by Haverstock Master Fund.  The 24-month agreement enables the Company to receive in aggregate $20 million through an initial $1,000,000 drawdown and up to $500,000 per drawdown subsequently. Timing of any drawdown is at Alter NRG's sole discretion and the Company is also able to set a minimum price for each drawdown.

  • Announced the option to invest in Tees Valley Renewable Energy Facility.  The option is with Air Products and Alter NRG has an option to invest up to 25%.

For more information on the Corporation's activities please visit www.alternrg.com or www.sedar.com to view Alter NRG's 2011 First Quarter Report.

CEO'S MESSAGE

It was an eventful quarter for Alter NRG as we began to actively explore options that will allow the Company to fully realize the intrinsic underlying value of our of three key assets along with the environmental, social and economic benefits of embracing responsible, renewable energy. When we announced in late March that we had formally entered into an agreement to explore strategic alternatives for the Company, we had some mixed reactions from shareholders. While some divergent feedback is always expected and while I fully believe in the adage that nothing would ever be accomplished if all objections must first be overcome, we take our responsibility to our shareholders seriously and consequently believe it is important to provide a more in depth look into the specifics that led our decision to engage in this process.

Strategy, at its most basic is about using assets and neutralizing vulnerabilities to take advantage of potential opportunity, and that in a nutshell is what this process is about. Alter NRG is a combination of three very unique and special assets, two of them being industry leading clean-tech assets.  Recently, we determined that our Fox Creek asset is one of the largest exportable thermal coal resources in the developed world. Direct comparables in the market have valuations of $0.20 to $0.90 per tonne of resource. We have received no value in the public markets for this resource, which alone supports our exertion that Alter NRG is, and has been, undervalued in today's market. Given the current global economy's interest in coal led by Asia aggressively purchasing coal resources, combined with Fox Creek's proximity to rail and ports that are expected to have capacity to take the coal to market, renewed interest in Fox Creek is significant and the strategic process is providing us the ability to explore opportunities to realize the value of this very important asset.

Second, while CleanEnergy has established itself as the leading commercial geoexchange solutions provider in Canada. We firmly believe this can be a $100 million business in the next 3 to 5 years and this is a significant market opportunity.  Notwithstanding the confidence we have that it can be profitable by the end of 2011, growing it further will require significant reinvestment into the business for the next 2 to 4 years. There are a variety of options we are able to explore through the assistance of our advisors in the strategic process that will assist in this necessity.

However, our core asset continues to be Westinghouse Plasma Corp. in which we have the industry leading plasma gasification technology that Alter NRG has been built around. Over the past four years, the Company has significantly improved the core technology by enhancing performance, reliability, and the overall economics which has allowed Westinghouse technology to maintain its technical and commercial lead over its competitors. However, inherent in plasma gasification projects are sales cycles measured in terms of four to eight years or more which creates lumpy and delayed revenue streams. It is a noteworthy challenge for a public company that is measured on quarterly revenue performance.  In short, we are a small cap public company in the early stages of market development, which may not be optimal in today's financial market. In these market conditions it is essential to have a strong balance sheet and good access to capital and the strategic process allows us to explore alternatives to support long-term growth with a strong balance sheet and a world class customer base.

It is important to give recognition to the attributes that have collectively made us successful in many regards and which I believe will continue to do so in the coming years. We know we have substantial work ahead of us to meet the expectations of our stakeholders and we welcome this challenge.  As in the past, everything our company hopes to achieve going forward begins and ends with the expertise and focus of our employees and our Board of Directors who challenge management to lead, innovate and grow our company. I want to recognize them for their guidance and support of our long-term vision while staying focused on developing strong and enduring shareholder value.

SELECT FINANCIAL RESULTS ($)    
  March 31, 2011 March 31, 2010
     
     
Total assets $81,286,392 $ 99,667,909
Total liabilities 21,991,065 19,587,652
Total equity 59,295,327 80,080,257
     
     
  Three months ended Three months ended
  March 31, 2011 March 31, 2010
     
Sales $ 2,422,746 $ 1,720,047
Loss (3,932,880)               (4,925,755)
Loss per share  - basic and diluted                     (0.06)                     (0.08)
 

For more information on the Corporation's financial results please visit www.alternrg.com or www.sedar.com to view Alter NRG's 2011 First Quarter Report.

The Toronto Stock Exchange does not accept responsibility for the adequacy or accuracy of this release.

Advisory Respecting Forward-Looking Statements:

This news release contains certain forward-looking information and statements within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should", "believe", "plans", "intends", "confident", "might" and similar expressions are intended to identify forward-looking information or statements. In particular, but without limiting the foregoing, this news release contains forward-looking information and statements pertaining to the following: availability and cost of key materials and labour and availability of funds with respect to the amount of capital expenditures and scheduled commencement of operations; timing of regulatory approval including various permits from the applicable government authorities; the assessment of capital markets including the availability of debt and equity in current market conditions; commodity prices resources that impact the Corporation's operations directly and indirectly; extent of investment by government authorities in infrastructure projects; the financial and operational health of key partners in various projects; the continued development of the Corporation's technology and its use in various applications and other expectations, beliefs, plans, goals, objectives, assumptions, information and statements about possible future events, conditions, results of operations or performance. Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking statements throughout this news release.

The forward-looking information and statements included in this news release are not guarantees of future performance and should not be unduly relied upon. Forward-looking statements reflect management's current beliefs and assumptions, based on information currently available to management. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements, many of which are beyond the control of the Corporation. Among the material factors that could cause actual results to differ materially from those indicated by such forward-looking statements are: that the information is of a preliminary nature and may be subject to further adjustment; unforeseen environmental effects; the completion of strategic partner's projects; arrangements with key suppliers; potential product liability and other claims; other business risks outlined in this news release, including risks associated with the proprietary technology; the possible unavailability of financing at competitive rates and the related effect on development activities; the effect of energy price fluctuations; changes in government regulation, including changes to environmental regulations; the effects of competition; the dependence on senior management and key personnel, and fluctuations in currency exchange rates and interest rates, as well as those factors discussed in or referred to under the heading "Risk Factors" in the Corporation's Annual Information Form dated March 29, 2011 available at www.sedar.com.  Such information and statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking information or statements.

The Corporation cautions that the foregoing list of assumptions, risks and uncertainties is not exhaustive. The forward-looking information and statements contained in this news release speak only as of the date of this news release, and the Corporation assumes no obligation to publicly update or revise them to reflect new events or circumstances, except as may be required pursuant to applicable securities laws.

 

SOURCE Alter NRG Corp.

For further information:

Mark Montemurro, Chief Executive Officer
(403) 806-3877       mmontemurro@alternrg.ca
Daniel Hay, Chief Financial Officer
(403) 214-4235       dhay@alternrg.ca

 

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Alter NRG Corp.

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