Global Green Signs MOU With Giant Partner
Earlier this week, Global Green Solutions (GGRN – $0.12) made an announcement that shouldn’t be underestimated. It signed a Memorandum of Understanding (MOU) to form a strategic partnership with the Ledcor Group of Companies (Ledcor).
Ledcor is a so-called EPC or Engineering, Procurement and Construction contractor. Basically a Company that designs an installation, buys the necessary materials for it and constructs it. With its 5,000 employees, Ledcor has a strong presence in Canada and the United States. It specializes in building civil, industrial, telecommunication and more recently renewable energy projects.
Importance of Partnership for Global Green
- Having a well-known EPC as a partner is significant to finance a project. Banks, and other financiers, need to know they’re dealing with a strong Company that can actually construct the project for which it’s seeking debt financing. If Greensteam would be the EPC, banks would view this as a higher risk.
- Ledcor’s partner, Offsetters is specialized in dealing with carbon credits that are generated with renewable energy projects. Having such a expert Company “in-house” helps Ledcor to evaluate a project and the financing of it.
- Because Ledcor has many offices in North America, Global Green can always work with the same EPC contractor for Greensteam projects in the U.S. and Canada, which eliminates the need to hire a contractor that doesn’t have the expertise of previous Greensteam projects.
- Ledcor has fabrication facilities, which means it can potentially build Greensteam specific components, like the dryer and combustor.
- And last but certainly not least, Ledcor has good contacts in the private equity space, so they may arrange financing for future Greensteam projects. As a matter of fact, Ledcor has taken equity positions themselves in a few hydroelectric projects in Canada.
The Partnership at Work
Ledcor and Global Green will both generate leads from existing and new clients. When a project meets their needs, they will present their case as partners where Ledcor handles the EPC related activities of the project and Global Green the technical solutions related activities.
As for projects in the pipeline, obviously no decisions have been made yet. But – and I’m just thinking out loud here – wouldn’t it be nice if Ledcor were to be involved in Greensteam’s first commercial project in the U.S.? I mean, the 10 full scale Greensteam units at Aera Energy have to be built by someone. Or is it just a coincidence that Ledcor’s U.S. head office is in San Diego, California, only a couple hundred miles away from Aera Energy’s Bakersfield oilfield?
With Ledcor, Global Green is bringing in a giant partner. This Company has performed a large amount of heavy construction work for clients in the oil, gas, pulp & paper, mining and petrochemical industries.
On the other hand, the fact that Ledcor is willing to sign a partnership with Global Green, is a strong affirmation of Greensteam’s valuable technology.
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