Successful Canadian Investor in Ukraine October 2018
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Background ▪ Calgary - based family office managing the Refraction Asset high risk portion of the Yurkovich family Management Ltd. investment portfolio Fund Manager ▪ Investing equity and venture debt into high growth opportunities in North America and Refraction 1 Fund GP Ltd. Limited Partners internationally General Partner ▪ Preferred industries: - Energy, including renewables Refraction 1 Fund - LP Defense - Ag. Technology TIU Group of ▪ Typical investment $3-10 million Companies ▪ TIU is an investment vehicle into the energy (CA, NL, UA) sector in Ukraine currently developing a portfolio of renewable projects 3
Investment Attractiveness of Renewables in Ukraine ▪ Opportunities under by the Canada- Ukraine Free Trade Agreement ▪ Ukrainian feed-in tariff (FIT) regime provides attractive returns and guaranteed comfort: – FIT is fixed in EUR and recalculated quarterly – No localization requirement but additional premium for using local components – PPA guarantees purchase of 100% of the renewable energy produced until the end of 2029 at the set FIT – FIT for ground mounted SPPs is currently set at EUR 0.1502 (C$ 0.225) per KWh ▪ Availability of debt financing from IFIs and local banks 4
Investment Attractiveness (cont’d) Ukraine 14.3% IRR Levered IRR for TIU solar projects in Ukraine is 20%+ 5
Challenges of Investing in Renewables in Ukraine ▪ Excessive bureaucracy ▪ Attempts to amend relevant legislation ▪ Obtaining land ownership / lease rights and land re-zoning ▪ Obsolete grid requires upgrades at the point of connection (could be costly) ▪ No bankable PPA at the beginning of construction 6
Our presence in Ukraine ▪ Initial focus on privatization of state- owned energy assets ▪ Subsequently re-focused on investing and developing greenfield renewable energy projects ▪ Manage a fully operational 10.5 MW (DC) SPP in Nikopol, Dnipro region ▪ Have an additional portfolio of solar projects of over 100 MW (DC) in solar projects under construction / development ▪ Reviewing other opportunities in agriculture, energy and other sectors 7
Our presence in Ukraine Nikopol 10.5 MW SPP - operational Mykolaiv cluster: 45.5 MW, including 13.5 MW currently under construction Odessa cluster: 65 MW 8
Our presence in Ukraine Signing the sister city agreement between Nikopol and Lloydminster Nikopol students and teachers touring our facility 9
The Ask ▪ Equity co-investors in approx. 100 MW of solar projects shovel ready by year end 2018 ▪ Cheaper sources of debt financing , specifically project financing To learn more about this investment opportunity, please contact Vladimir Lizunov, CFA VP Finance and Corporate Development TIU Group of Companies 202 6 Ave SW Suite 1110, Calgary, AB T2P 2R9 +1 (403) 613-6085 vlizunov@tiucanada.com 10
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