Kaishan Group Co., Ltd (“the Company”)’s Singaporean wholly-owned subsidiary OME Eurasia Pte., Ltd (“OME Eurasia”) signed a Share Subscription and Shareholders Agreement (“Agreement”) with Sonsuz Enerji Holding B.V.(“Sonsuz”) of Transmark Turkey Gülp?nar Yenilenebilir Enerji üretim Sanayi ve Ticaret Anonim ?irketi (TTG or target company”). OME Eurasia will contribute up to US$21,000,000 to TTG in stages to acquire 49% of TTG’s shares upon satisfaction of the conditions precedent to the Closing.

賣方及TTG介紹

Briefing of the Seller and TTG

Sonsuz Enerji Holding B.V., incorporated in the Netherlands, is the sole parent company of TTG. Sonsuz is a member company of the Transmark Group, with its business in geothermal energy exploitation and submarine cable and connector system equipment manufacturing, installation and service. Transmark Group holds several concessions for exploration and production of geothermal energy in Türkiye and Chile.

TTG is Sonsuz’s special purpose entity for the development of geothermal resources in the Gülp?nararea in Türkiye and is qualified to develop geothermal resources in the Ayvacik district in the province of ?anakkale, Türkiye, and to construct a power plant of up to 19 (3.2+15.8) MW (nameplate power) (the “Transmark GPP”). In November 2019, TTG and OME Eurasia signed the “EPC Service contract for the 3.2MW geothermal power plant (“Phase I”) was put into commercial operation in June 2021.In addition to the Phase I power plant, TTG has the following key permits:

?Generation license (19MW), valid till Feb 2043, subject to facility completion by 25^th May 2024;

?Easement for geothermal resource operation and electricity production activities on designated parcels of land in Ayvacik District, ?anakkale Province, valid until February 2043;

?Environmental, construction, zoning, tax incentives and other necessary certificates or licenses.

The Transmark GPP is entitled to the legacy YEKDEM^[1] system of Türkiye, in which selling power at $105/mWh (feed-in) up to 31^st Dec 2030. Upon the expiry of YEKDEM term, TTG may sell power on the spot market.

Picture 1: TTG’s geothermal exploitation license (inside the blue boundary). Transmark GPP is located in license Block E .

圖1：TTG的地熱開發(fā)準證，其中藍色邊界線內(nèi)為準證覆蓋區(qū)域（E區(qū)塊Transmark GPP項目所在地）。

Transmark GPP項目基本情況

Briefing of the Transmark GPP

1) Project Development 項目開發(fā)

The Transmark GPP is located in Biga Peninsula; the movement along the southern segments of the North Anatolian Fault Zone and Kestanbol Fault system have created the permeability controlled by the geothermal structure in the region, establishing the thermal circulation of deep, hot geothermal fluids to shallower levels. There are more than 5 geothermal projects under operation and/or development in ?anakkale Province where the project is located.

Figure 2: Fault Distribution Map for Biga Peninsula. The Transmark GPP is located in the red box.

圖2：Biga半島斷層分布圖，紅框為Transmark GPP項目所在準證區(qū)塊

There are many wells in and around the E-Block to provide control points to the geological-, geophysics- and geochemistry data of the reservoir. In addition to the existing three wells in Phase 1 Power Plant, there is a 12 MW geothermal power plant to the north of the E Block and more than 20 intermediate-to-deep wells are located in the vicinity. TTG’s independent consultant believes that the heat resource temperature (125 ℃) and heat resource flow (34.5kg/s/MW) expected in the Development Plan are within a reasonable range; Subject to a 20-year life time, the P90 and P50 estimate of the Transmark GPP’s power capacity is 18 MW, and 27 MW respectively.

The total capital investment of Phase 2 Power Plant is budgeted at USD 58 Million, with a projection of 5 production wells and 3 injection wells. The existing teams of Sonsuz and TTG are responsible for subsurface engineering, and OME Eurasia and the Company’s teams are responsible for the design, manufacturing and installation of modular power plants. Phase 2 is expected to reach Commercial Operation in 2024.