CORPORATE NEWS

Daldrup & Söhne AG welcomes BMWK and KfW initiative on insurance solutions for deep boreholes

• Insurance solution helps to tap the potential of geothermal energy in Germany on a large scale
• Daldrup has successfully used its own insurance concept for years in use for years

Oberhaching / Ascheberg, 25 March 2024 - Daldrup & Söhne AG (ISIN DE0007830572), drilling technology and geothermal specialist, supports the initiative of the Federal Ministry of Economics and Technology (BMWK) and the KfW development bank to establish a state-supported insurance solution for the so-called exploration risk for deep geothermal wells. The exploration risk refers to the risk that drilled boreholes in the subsurface do not reach the temperatures or yields (known as the "fill") of the aquifers assumed in advance. This measure is part of the "geothermal campaign", which the ministry presented at the end of 2022. KfW loans can already be applied for the realisation of deep geothermal projects, but the securing of the discovery has not yet been included.

Andreas Tönies, CEO of Daldrup & Söhne AG, welcomes the BMWK's plans to insure exploration risks: "A state-backed insurance solution will remove a major hurdle for municipal and private clients of deep geothermal projects. The rapid development of domestic geothermal energy is the decisive building block for the successful decarbonisation of the heat supply. Relevant studies assume that geothermal energy can provide up to 40 per cent of the heat supply. We should utilise this potential quickly. This is because geothermal heat offers a secure base load supply at the point of consumption, is virtually emission-free and can be realised in the smallest of spaces. Although it requires electricity for pumps, it is climate-friendly and more effective in the long term than any other heating method."

Daldrup & Söhne AG already offers customers insurance concepts

Together with well-known partners in the insurance industry, Daldrup & Söhne AG has developed a concept to cover exploration risks during the construction of deep geothermal projects. The so-called ART concept (Alternative Risk Transfer) has already been successfully utilised several times by customers in Germany and the Netherlands since 2016. The key feature of the hedging concept is that it can be used to support the financing of qualified geothermal projects with a high proportion of debt capital from banks. This means that geothermal drilling projects can often be financed for project developers and investors right from the start, even via banks. Daldrup acts neither as a financier nor as an insurer. The exploration risks are borne by third parties.

Über die Daldrup & Söhne AG

Daldrup & Söhne AG (ISIN: DE0007830572, WKN: 783057) with a company history of more than 75 years is a specialised provider of drilling and environmental services and is positioned among the leading companies in Germany. Its activities are divided into the business areas Geothermal, Resources & Exploration, Water Extraction and Environment, Development & Services (EDS). In the Geothermal Energy business sector, drilling services are provided both for near-surface geothermal energy (especially geothermal probes for heat pumps), but above all also drilling services for deep geothermal energy of up to 6,000 m, in order to use the geothermal energy thus accessible for the generation of electricity and/or heat. In the Raw Materials and Exploration business sector, the wells drilled by Daldrup & Söhne AG are used for exploration as well as mineral raw materials and ores (e.g. copper and gold). This division also provides drilling services in the context of finding a safe final repository for nuclear waste. The Water Extraction business area includes well construction for the extraction of drinking, industrial, medicinal, mineral, boiler feed or cooling water as well as thermal brine. The business area Environment, Development & Services (EDS) comprises special environmental engineering services such as the hydraulic remediation of contaminated sites, the construction of gas extraction wells for the extraction of landfill gas, the construction of groundwater quality measuring points or the construction of water purification plants.

The shares of Daldrup & Söhne AG are listed in the Scale (sub-segment of the Open Market of the Frankfurt Stock Exchange) and part of the Scale30 Index.

Disclaimer

This publication constitutes neither an offer to sell nor a solicitation of an offer to buy or subscribe for securities. This publication and the information contained therein are not intended for direct or indirect distribution in or within the United States of America ("USA"), Canada, Australia or Japan.

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