Canada’s Wind Works Power Corp on Wednesday said it signed an option agreement to acquire Ecsed, a 50MW wind farm in Hungary, for a combined USD 500,000.
Wind Works Power will make an initial payment of USD 125,000 in January and pay a further USD 375,000 in March 2010.
Ecsed is Wind Works Power’s second project in Europe. Earlier it signed an option to buy a 100pc stake in Honelles, a 10MW wind farm in Belgium. The company will spend more than USD 2m on development costs over the next three years to create an investment opportunity valued at more than USD 150m, it said.
If they have more than about 3 wind turbines it sounds like a bloody bargain!
It’s a shame that Ecsed can’t turn this technology into something as valuable as Wind Works seems to be able to. Its a lot to you and me, but $500000 must be a loss on their capital investment, why would they do that?
OK check this out
http://ezinearticles.com/?How-Much-Do-Wind-Turbines-Cost?&id=1360858
“The cost of the commercial wind turbines varied from $1 to $2 million per MW of nameplate capacity installed. The same turbines 2 MW in size cost roughly $2.8 million installed capacity.”
I know it is not conclusive but according to this article a 50MW wind farm would require a captial investment somewhere between $50million to $100million.
Selling this for 1/100th of the investment costs is unbelievable and in my opinion a bit fishy.
I am not saying this article is definitive but I suspect it is not 100-200 times out!
Anyone else think this purchase is odd?
Very odd, but then again this is Hungary where a little money in the right hands can gain you some great deals.
The entire wind energy industry is a scam. Generally the companies receive millions in subsidies from the government (that means you and me the taxpayors). The companies receive the monies and pocket most of it; then they build a few windmills and the public goes : oooh ahhhhh woowwwooowowewewowow. The politicans tell the Sheeple: see we love you and the environment. Meanwhile the money is stolen, little energy is produced, the windmills fall apart and need very costly repairs. A complete scam.
JD,
the numbers you’re quoting are for an up-and-running wind farm, whereas Ecsed is just a project on paper…the reason its in an ‘advanced’ stage is because they’ve been sitting there and calculating the wind speed for 2 years:
Project Highlight:
The Ecsed Wind Park is a 50 MW project that has been in development for more than two years. It is located in the vicinity of Ecsed, Hungary. Annual mean wind speeds are over 7 meters per second at a 100 m hub height. Transmission availability has been confirmed and land acquisition is complete. The project is eligible to participate in a RFP process in the summer of 2010. Permitting is expected to be completed in mid-2011.
http://www.tradingmarkets.com/.site/news/Stock%20News/2644315/
Hi Jan
Interesting, although you might even think that the land alone for a wind farm would come to a bit more than that.
Are you suggesting that there is nothing really there at the moment just some peope making wind measurments?
Saying that, it doesn’t sound like Wind Works Power’s substantial USD 2m investment over the next 3 years will get them a lot more.
It is hard to find any real information about this, most of the reports are just regurgitations of each other.
Something still smells fishy and I doubt it’s Ecsed’s nearby lake.
JD,
In a windfarm project the investor doesnt buy the land – it signs long term rental contracts with the land owners.
Hi Anonymous
OK, so they rent the land, they have paid for approximately the cost of 1/2 MW capacity for a stated 50MW capacity wind farm and they plan to invest $2 million over the next 3 years which will buy them approximately 2MW more after 3 years.
I am definitely missing something.
JD,
I think the half million $ covers the rental contracts, like Anonymous said, and the $2mil will cover the cost of bringing power lines, etc…that will “create an investment opportunity valued at more than USD 150m”…of course in order to take advantage of that opportunity they will still need to invest additional capital to build the wind farm.
I did a bit of searching on this one. Am now convinced that this is the same as a property time share scam. This farm will never be built. For $10k you can buy into this wind farm to cover your carbon foot print. But, as the small print says, if full permissions are never received then it is the investors loss. They staged the payments to give then time to find the ecological suckers who will part with their 10 grand. Enjoy your windmills. X
Hi David, Jan
I’m not so sure it is a scam but something isn’t 100%.
Jan, if, as you say, this is for land rental and $2M covers connection costs, then where is the 50MW of capacity since this is not included in the investment figure and not possible with $2M bucks. If it is already there then the buying price is absolute non-sense. If not, then at about $1.5M per MW it would cost around $75M to develop 50MW, this is not peanuts and dwarfs the stated $2M investment. I would expect it to be noted somewhere.
So the questions remain:
1. What are they buying for $500k?
2. What will they spend the $2M on?
3. How much will they have to spend to realise this “investment opportunity” of $150M?
4. If it is that good then why don’t the current owners invest some money and get a better ROI?
5. What EU/Government grants have already been used up in this “opportunity” and how is the public now benefitting from this sale?
My concern is also that a few people may have been “persuaded” to sell this at a totally knock-down price. Why so cheap? So far, unfortunately, none of the comments seem to be able to justify what is happening according to news reports.
I think it sounds OK, though of course, there probably hasn’t been 500k really spent so far. The actual turbines will no doubt be funded by the EU, or by local banks, who shown the 2 million investment in infrastructure will lend the money happily (and stupidly).
It could well end up like the golf course in Pecs, where the owner of many small plots managed to build an illegal (without planning permission) clubhouse then borrow millions in Austria against the land etc. and did a runner ! Now the land we would be happy to buy/sell is burdened with stupid amounts of liens way over the realistic value and no-one is willing to write this off. I wonder which sunny island the scamsters are relaxing on !?
Well that’s it then!
I guess I will find some flat piece of unnused farmland stand there for 6 months with a couple of Anemometers and wait until I get paid $500k for my troubles by Wind Works Power.
There is definitely a little more to this than meets the eye. I wonder. Time for a slightly deeper dig on the internet I feel.
JD,
since you have the will i leave you an advise about how to start a wind farm in 3 steps:
1-identify the regions with viable wind – the information is public (lets put the cost in EUR 5.000 in case you decide to buy a couple of studies)
2 -identify and negociate with a suficient number of property owners future rental contracts for the land (if you have the contacts and support of a couple of municipalities it can be cheap – if you really have to digg and employ someone it can cost you 50.000 – 100.000 EUR)
3 – put the test tower and make the test. You should have believable tests – so at least you need 1 year (put it 50.000 – 100.000 EUR more).
Everything points they this guys sold the project at this point so we are talking about a really nice profit. but also be aware that for 1 project that works, 10 fail… Not really for amateurs.
Cheers
Thank you Anonymous, so it is all smoke and mirrors, with a bit of wind thrown in
It is a total scam against the public. This was subsidized by the Hungarian government (ie you and me the taxpayors). It was also subsidized by the EU (ie the EU taxpayors). The investment is lost. The money is gone. It is a complete street hustlers move. But you wont this reported in your newspaper “rags”. The media wont touch this scam. People wonder how the government manages to lose billions of our tax dollars. This is just one “little” example. Oh well it is only the People’s money. More government scams await…
salk1, I wouldn’t get too upset too quickly. The more I read about this the more it seem that any old Joe with a few $$ can start a “Wind Park” project and do little more that measure the wind for a few years to get this kinda sale.
I am not sure what Wind Works Power Corp get from it other than what seems to be cheap land.
http://www.renewableenergyworld.com/rea/news/article/2009/11/wind-works-to-acquire-50-mw-project-in-hungary
“Transmission availability has been confirmed and land acquisition is complete.”
But on that note, the site in Belgium seemed to go for almost 5x the Hungarian site
http://smallcapvoice.com/blog/wind-works-power-corp-signs-option-to-acquire-100-interest-in-wind-energy-project-in-belgium/
“they have signed an option agreement to acquire a 100% interest in Honelles, a 10 megawatt wind energy project located in Belgium. In consideration for the 100% interest, Wind Works will make an initial cash payment of $100,000 on January 15, 2010 and a further cash payment of $375,000 on March 15, 2010.”
More to the point on this one they plan an near 25x ROI
“$1.1 million over the next two years and create an investment opportunity of $25 million”
I have no idea what is going on but it seems like good business.
I’ll keep reading
Oh I forgot
http://bbjonline.hu/?col=1004&id=50824
“MTI has learnt that Germany’s SEVA Energie AG had plans to build a wind power plant in Ecsed.”
Sold to the highest bidder? I doubt it.
@JD.Hi, as i said earlier, it is like a time-share. Here is a quote from a company called-Zero Emission People- This is a company that Wind Works Power just bought and will take over in January.
“The vision of Zero Emission People is to provide the opportunity for anyone to invest early in the development of renewable wind energy projects. As an example, as little as a $10,000 investment in a wind park blows away a person’s carbon footprint. We believe in making sound, environmentally conscious investments that are good for all shareholders, people and our planet.”
So, in January they will have the job of selling 15.000 Zero Emission footprint shares at $10k each to a load of idiots that will never get a penny profit.USD 150m.
By the way, this company is less than 6 months old and looks very fly by night to me.
Here is a stock market quote from Wind Works
“Since our inception we have been engaged in several different business fields, none of which were successful. Our initial focus was to develop high speed wireless internet access to the public via public hot spots. This business venture was not successful and was terminated in early 2006. In June 2006, we changed our business focus to concentrate on precious metal exploration, primarily gold and silver. In furtherance thereof, we acquired mining rights to several different mining concessions. None of this proved successful including the Exmin Joint Venture.”
It operates out of a 750 sq foot office, $700 rent.Lost $450000 in the last 3 months and lost $7 million over the last 7 years and has never paid a dividend to its stockholders. They say they will not buy any actual wind turbines but will sell sites with full permission for wind farms. Good luck.
Great info David. What is your refence source?
Internet to mining to wind turbines. For real?
Where does their investment come from?
How can they be a listed stock company with no product or profit? Was the IPO through the internet idea?
Sounds like there not just air around this wind turbine lark but plenty of hot air.
It’s too bad that 99% of the news reports (unfortunately including this one) just regurgitate the same stuff rather than report something a little more interesting and informative.
http://us1.institutionalriskanalytics.com/SEC/SEC_DOC.asp?b=&doc=edgar/data/1273507/0001096350-09-000100-index.htm