Announcement PDF RNS Number : 2652K EnergyPathways PLC 30 June 2026 30 June 2026 EnergyPathways plc ("EnergyPathways" or the "Company") Annual Results and Notice of AGM EnergyPathways (AIM: EPP), the UK energy transition company, is pleased to announce the publication of its Annual Results for the year ended 31 December 2025 and Notice of Annual General Meeting. Period Highlights: · Long Duration Energy Storage element of MESH designated a development of "national significance" · Application for Gas Storage Licence submitted in November 2025 · Launched engineering studies for a hydrogen and graphite production plant using Hazer Group Ltd proprietary hydrogen production technology licensed with KBR Inc ("KBR"). · Engagement of key industry partners, including Siemens Energy Limited, Zenith Energy Ltd, Wood Group PLC and Costain Group PLC. · Loss for the period £1,659,501 (2024: £1,203,671). Cash at year end of £1,092,759 (2024: £857,650) Post period-end: · Launch of FEED for Long Duration Energy Storage project · Submitted proposed MESH gas storage development to DESNZ as part of response to consultation "Gas System in Transition: Security of Supply" · Signed £15 million Financing Agreement · Grant of Gas Storage Licence GS009 in May 2026 · Collaboration Agreement with Associated British Ports to jointly evaluate Port of Barrow location for MESH onshore facilities · Appointment of Alison Flower as Non-Executive Director and Martyn Millwood Hargrave as Chief Scientific Officer Notice of AGM The Company's Annual General Meeting ("AGM") will be held at 10.00 a.m. on 22 July 2026, at the Royal Over-Seas League, 6 Park Place London SW1A 1LR To be valid, proxy votes must be received by the Company's registrar, Share Registrars, as soon as possible and in any event no later than 10.00 a.m. on 20 July 2026. A copy of the Notice of AGM, together with the Annual Report, will be posted to shareholders on 30 June and will be available to view free of charge on the website of the Company at www.energypathways.uk. Commenting on the results and outlook, CEO Ben Clube said: "EnergyPathways has achieved much over the past 12 months, but there is still important work ahead. The direction of travel, however, is firmly with us. MESH has a major contribution to make to the UK energy landscape, and as CEO, I am excited to be leading a strong and experienced team capable of bringing this project into commercial operation by 2031 and building on our groundbreaking technology solution. "Looking ahead, the next 12 months will be critical, as we will enter MESH into the LDES Cap and Floor second window, begin the Development Consent Order process, seek additional licences from the North Sea Transition Authority, finalise commercial agreements with supply chain partners and secure new growth opportunities. The value prize is enormous and into the billions of pounds: with the continued support of our current and future shareholders, MESH can help reshape and strengthen the UK's energy future while unlocking considerable value for our shareholders." This announcement contains inside information for the purposes of the UK Market Abuse Regulation and the Directors of the Company are responsible for the contents of this announcement. Caution regarding forward looking statements Certain statements in this announcement, are, or may be deemed to be, forward looking statements. Forward looking statements are identified by their use of terms and phrases such as ''believe'', ''could'', "should" ''envisage'', ''estimate'', ''intend'', ''may'', ''plan'', ''potentially'', "expect", ''will'' or the negative of those, variations or comparable expressions, including references to assumptions. These forward-looking statements are not based on historical facts but rather on the Directors' current expectations and assumptions regarding the Company's future growth, results of operations, performance, future capital and other expenditures (including the amount, nature and sources of funding thereof), competitive advantages, business prospects and opportunities. Such forward looking statements reflect the Directors' current beliefs and assumptions and are based on information currently available to the Directors. Enquiries Investor questions on this announcement We encourage all investors to share questions on this announcement via our investor hub https://energypathways.uk/link/eXg7qy EnergyPathways Ben Clube / Max Williams Tel: +44 (0)207 466 5000, c/o Burson Buchanan (Financial PR) Email : info@energypathways.uk Cairn Financial Advisers LLP (Nominated Adviser) Jo Turner / Louise O'Driscoll / Sandy Jamieson Tel: +44 (0)20 7213 0880 SP Angel Corporate Finance LLP (Broker) Richard Hail / Adam Cowl Tel: +44 (0)20 3470 0470 For further information on EnergyPathways visit www.energypathways.uk and @energy_pathways on X (formerly Twitter). Chairman's Statement I am very pleased to be writing to EnergyPathways plc shareholders following a year in which the Company has made significant progress in advancing its flagship Marram Energy Storage Hub project, MESH, and in which the strategic importance of our proposition has become increasingly clear. 2025 was an eventful year, both for EnergyPathways and for the UK energy market in general. The year was characterised by continued focus on energy security, the affordability of energy, the transition to Net Zero, and the critical role that Long Duration Energy Storage must play if the UK is to integrate increasing volumes of renewable power while maintaining reliable and affordable supply. Against this backdrop, the Board believes that EnergyPathways has continued to position MESH as a pragmatic, commercially focused and nationally important energy infrastructure project. Financial Results The Group incurred a loss for the year of £1,659,501 compared to a loss of £1,203,671 for the year ended 31 December 2024. Losses mainly arose from expenses in connection with staff remuneration, technical and other consultancy fees, the costs of being an AIM quoted company, project development costs and general administration expenses. Net assets of the Group at 31 December 2025 amounted to £2,486,631 (2024: £1,266,509). The gross proceeds raised through direct subscriptions, placings and the exercise of options and warrants during the year ended 31 December 2025 amounted to £2,639,592 before expenses (2024: £1,565,245 before expenses). Cash at year end was £1,092,759 (31 December 2024: £857,650). Strategic progress during the year During the year, the Company continued to build on the strategic pivot made in 2024, when we announced MESH as a fully integrated energy storage hub, designed to combine natural gas storage, hydrogen storage, compressed air energy storage, low-carbon power generation and associated industrial opportunities in the East Irish Sea and Barrow-in-Furness. In February 2025, following pre-FEED work undertaken with strategic partners, the Company announced the selected technical design for the initial phase of MESH. This work reinforced the Board's belief that MESH is capable of repurposing existing late-life gas infrastructure, utilising the energy resources of the North West of England and the East Irish Sea, and providing a practical route to delivering low-emission energy storage at scale. The Company also continued to progress the hybrid compressed air energy storage component of MESH. Long Duration Energy Storage is increasingly recognised as a vital missing element in the UK's energy system. Wind power is being curtailed at considerable cost to consumers, while the electricity grid continues to require reliable, flexible and dispatchable power when renewable output is low. We believe MESH can help address these challenges in a commercially disciplined manner, by storing surplus energy and making it available when it is most needed. During the period, the Company strengthened its technical and delivery capability. Zenith Energy Ltd was engaged for well engineering while the Company also continued to develop its relationships with tier-one partners and specialist engineering groups, including Siemens Energy, Costain, Wood, Hazer and KBR. These relationships are important not only because of the capabilities they bring to the project, but also because they demonstrate the increasing recognition of MESH as a serious and scalable energy infrastructure opportunity. The Major Announcement of 2025 Much of 2025 was focused on an application to Government in relation to Section 35 of the Planning Act 2008 which empowers the Secretary of State to direct that a project be treated as a Nationally Significant Infrastructure Project (NSIP). This allows the development to bypass standard local planning routes and be fast-tracked through the centralised Development Consent Order (DCO) process. The Company's key milestone during the year was the decision in September of the Secretary of State for Energy Security and Net Zero that the major elements of MESH, specifically the Company's Long Duration Energy Storage (LDES), should be treated as a development of national significance. This was a landmark moment for EnergyPathways. It recognised the scale, strategic relevance and potential national importance of the MESH project. The Board believes this decision was a strong endorsement of the Company's whole-system approach to energy storage, energy security, decarbonisation and regional industrial development. Following this confirmation, the Company continued to refine and expand the scope of MESH. In November 2025, the Company submitted an expanded Gas Storage Licence application covering the natural gas and hydrogen storage elements of MESH. This application covered an area with potential for up to 60 salt caverns for natural gas and hydrogen storage, representing an almost fourfold increase in the area being targeted for salt cavern development. This was an important step in aligning the licence area with the scale of opportunity that the Board believes exists in the East Irish Sea. Business outlook The need for MESH has, in the Board's view, become increasingly compelling. The UK continues to require greater energy storage capacity, more flexible low-carbon power, improved resilience to international gas price volatility and a practical means of reducing the cost burden of renewable curtailment. We believe MESH can make a material contribution to each of these challenges. The Company's strategy remains aligned with the key strands of UK energy policy: decarbonisation, energy security, electrification, reutilisation of existing infrastructure, protection of the environment and industrial growth. Importantly, our approach remains pragmatic and commercial. We believe the energy transition must be delivered in a way that is technically credible, financeable and capable of reducing, rather than increasing, pressure on consumers. Post year-end progress In the period following the financial year end, the Company has made further significant progress. Costain completed a first phase of engineering studies for the MESH onshore facilities at Barrow-in-Furness, shortlisting potential sites for further evaluation and front-end engineering and design. Shortly afterwards, the Company announced that pre-FEED studies with Siemens Energy had confirmed the economic viability of the MESH compressed air Long Duration Energy Storage project and that FEED had been launched, supported by a £15 million financing agreement. These developments represent important practical steps towards moving MESH from concept and pre-FEED into the next phase of engineering and delivery. Most importantly, in the period following the financial year end, the North Sea Transition Authority (NSTA) offered a Gas Storage Licence to EnergyPathways Irish Sea Limited in connection with the MESH project. The offer was accepted. This is another major milestone for the Company and materially advances the Company's plans to develop large-scale natural gas and hydrogen storage as part of the wider MESH integrated energy system. The award of the Gas Storage Licence is especially significant because gas storage remains a fundamental component of national energy resilience. The planned MESH gas storage facility is intended to strengthen the UK's energy security, reduce over-dependence on expensive imports and provide high-deliverability storage capable of supporting the grid when it is most needed. Alongside the Company's compressed air energy storage project, hydrogen production plans and sustainable industrial opportunities in Barrow-in- Furness, the licence strengthens the Board's belief that MESH can become one of the UK's most important integrated energy storage projects. In the period following the financial year end, the Company also entered into a collaboration agreement with Associated British Ports (ABP) to evaluate ABP's Port of Barrow as the location for MESH onshore facilities. This relationship further highlights the potential of MESH not only as an energy security project, but also as a catalyst for investment, employment and sustainable industrial growth in Barrow-in-Furness. On 28 April 2026 the Company announced a £15 million financing agreement, comprised of a £5 million Loan Note and a £10 million 'At-The-Market' Equity Placing Facility. The Board was also pleased, in the period following the financial year end, to strengthen the Company's advisory and governance capability through the appointment of Martyn Millwood Hargrave as Chief Scientific Adviser and Alison Flower as an Independent Non-Executive Director. Martyn Millwood Hargrave is a geoscientist, business entrepreneur and strategic adviser with over 40 years of experience across subsurface technology, energy systems and industrial innovation. He is the founder and former CEO of Ikon Science, a global subsurface software company acquired by Constellation Software in 2025. He is currently a Visiting Professor in Earth Sciences at the University of Oxford and a Senior Associate at Oxford Net Zero. His experience spans global hydrocarbon exploration and production, carbon capture and storage, hydrogen, geothermal energy, nuclear waste disposal, and greenhouse gas removal. He has advised governments, regulators, and industry bodies on technically complex and strategically significant projects. Alison Flower brings over 30 years of global energy sector and policy experience. Most recently, she served for six years (2019-2025) as the Senior Energy Advisor at the UK Foreign, Commonwealth and Development Office, focusing on energy security and transition diplomacy. She previously held senior leadership roles at BG Group, is a Fellow of the UK Energy Institute, and serves as an Ambassador for POWERful Women. Her dual background in both government strategy and commercial market strategy will provide critical insight as EnergyPathways advances the MESH energy storage project Their combined experience in subsurface systems, energy policy, energy security, hydrogen, industrial decarbonisation and strategic minerals will be highly valuable as the Company progresses MESH towards development consent, financing and ultimately Final Investment Decision. The Board believes that the recent award of the Gas Storage Licence, together with the confirmation of MESH as a project of national significance, the launch of FEED for the compressed air energy storage project, the £15 million financing agreement, and the growing group of tier-one strategic partners, place EnergyPathways in a very strong position. We remain focused on converting this momentum into shareholder value. The Company will now work at pace to advance engineering, consenting, financing and commercial discussions with the objective of progressing MESH towards Final Investment Decision and, in due course, into operation. We believe MESH has the potential to deliver material benefits for shareholders, consumers, the UK energy system and the wider economy. Our Stakeholders and our Ethos The Company's stakeholders are as important as its shareholders. They are His Majesty's Government, the people of the North West of England, and indeed the people of Britain. What EnergyPathways aims to do should not be political and the Company seeks to be as apolitical as possible. This Government and previous ones are right to have recognised that the upstream oil and gas industry in the United Kingdom is in decline, and we believe the UK should manage that decline in a way that maximises the country's remaining hydrocarbon resources through the development of LDES and utilisation of gas storage. Technically, and operationally, we aim to challenge what might be called "received opinion" or "the status quo". This is not driven by any sort of partisanship, and we certainly don't subscribe to "disruptive capitalism". Quite the opposite, we aim to facilitate economic growth, lower the cost of electricity, create new jobs and industrial opportunity in a commercial and entrepreneurial manner. EnergyPathways is a facilitator not a disruptor. Board and team In making this statement, I would like to pay my respects and offer my high regard to the team in Aberdeen, where, as I write, we are now establishing our formal operational base. The project management, operational, technical and commercial skills of this team are of the highest order, their skills honed in the UK's highly successful oil and gas industry. This team will be responsible for a number of industry 'firsts', with which we will all be proud to have been involved. As the Company has grown and the scale of MESH has increased, the Board has remained focused on ensuring that EnergyPathways has the right blend of technical, financial, commercial and governance expertise. During the year and subsequently, the Company has continued to strengthen the team supporting MESH and to develop the relationships necessary to move the project through engineering, consenting, financing and commercialisation. I would like to thank our executive team, technical advisers, project partners and my fellow Directors for their service and wise counsel during the year. MESH is a complex and ambitious project, and the progress made reflects a very considerable effort by a small but highly capable team. I should of course also pay tribute to the indefatigable leadership of our CEO, Ben Clube, without whom, I believe we can say, with certainty, none of what we have achieved so far, would have happened. Finally, I would like to thank our shareholders for their continued support. The Company has made considerable progress during the year and, particularly in the period following the financial year end, has achieved milestones that materially de-risk and enhance the MESH opportunity. We look forward to the next stage of EnergyPathways' development with confidence and enthusiasm. Mark Steeves Chairman 29 June 2026 CEO's Report MESH and its potential to reshape the UK's energy future The past year has brought the UK's energy and climate challenge into sharp focus. As the national debate over net zero has intensified, so too has the recognition that the UK's economic growth, industrial competitiveness and household prosperity all depend on having an abundance of cheap and reliable energy. For the UK, the central issue is not whether we can build a cleaner energy system, but whether it delivers affordable energy. The UK's net-zero policy agenda, has at its core, a transition to use electricity rather than oil and gas. Despite more than half of the UK's electricity coming from renewables last year, electricity use has grown slowly. Electricity still only accounts for 17% of the UK's total energy consumption - no higher than it was two decades ago. The reason electrification has not happened is simple - our electricity prices are too high. In fact, they are some of the highest in the world. The UK's ambition of becoming a clean energy superpower, with an economy to match, depends heavily on it reducing electricity prices. The reason our electricity bills are so high is principally due to two interrelated factors. Firstly, we are heavily reliant on expensive gas-fired power when renewable power is in short supply, and it is setting the market price for all our electricity. Secondly, the UK is wasting much of the intermittent renewable energy it is generating due to the supply/demand imbalance caused by the fact that wind is intermittent. The UK desperately needs a solution to help lower its electricity bills. It needs a solution that can harness the nation's abundant renewable power generated efficiently so that it can then be used to replace expensive gas power. The answer lies in long-duration storage. It is against this backdrop that EnergyPathways is bringing forward its MESH project, and I am pleased that the level of interest in and support for its development has been overwhelmingly positive and has continued to grow throughout the year. MESH's classification as a project of "national significance" in September 2025 by the Rt Hon Ed Miliband MP, Secretary of State for Energy Security & Net Zero, was a major milestone for EnergyPathways and a strong message of confidence in the strategic arguments for MESH and, a further recognition of the benefit that low cost Long Duration Energy Storage ("LDES"), such as MESH, offers the UK's future energy system. Since then, the Government's message of confidence in EnergyPathways and its MESH project has been backed up with the award of a Gas Storage Licence by the Government regulator, the North Sea Transition Authority. The Licence area, in the East Irish Sea, holds massive potential, and we estimate the offshore construction of up to 60 large-scale energy storage caverns. MESH is expected to be the UK's largest LDES project by some stretch. It also has the potential to be scaled up many times just within the Licence. The prospect of providing up to 3 GW of flexible power alone would be enough to power almost a third of the UK's households. We are now working towards a Final Investment Decision (FID), planned for 2028 for the first phase of the MESH storage project, with operations commencing in 2031. In addition to providing large-scale integrated energy storage, MESH has the potential to develop new hydrogen industries, producing synthetic graphite, ammonia and other high- value hydrogen products, thereby supporting the UK's industrial growth strategies, in particular within the UK defence and nuclear industries. It is for all these reasons that the UK Government, with ministerial support, has encouraged us to progress the MESH project and why we have been successful in garnering a consortium of experienced Tier 1 companies to work with us, including Siemens Energy, Wood, Costain, KBR- Hazer and more recently ABP. We have also received the support of Team Barrow, a UK Government-led initiative that involves BAE Systems, Westmorland & Furness Council and the Department of Housing, Communities and Local Government. Team Barrow is spearheading the town's development and future economic growth. The economic benefits of MESH are significant. Its ability to generate sustained flexible power over multiple days at a fraction of the cost of gas power generation is a game-changer in lowering the UK's electricity prices. It can also shore up the country's energy security as well as support net-zero objectives. We have achieved much over the past 12 months, but we know there is still important work ahead, including consents, licences, technical and engineering studies and financing. The direction of travel, however, is firmly with us. MESH has a major contribution to make to the UK, and as CEO, I am excited to be leading a strong and experienced team capable of bringing this project into commercial operation by 2031 and building on our groundbreaking technology solution. Looking ahead, the next 12 months will be critical. We will enter MESH into the LDES Cap and Floor second window, begin the Development Consent Order process, seek additional licences from the North Sea Transition Authority, finalise commercial agreements with supply chain partners and secure new growth opportunities. The value prize is enormous and into the billions of pounds: with the continued support of our current and future shareholders and stakeholders, MESH can help reshape and strengthen the UK's energy future while unlocking considerable value for our shareholders. I am often asked why MESH is needed, how it will fit within the UK's energy system and its benefits compared to other energy sources. I trust that the addendum below MESH: its role in reshaping the UK's energy future outlines its significant value potential. Ben Clube Chief Executive Officer 29 June 2026 MESH: its role in reshaping the UK's energy future The UK is a global leader in renewable energy, and last year it reached a significant milestone with more than half of its electricity coming from renewable sources. However, a central challenge facing the future development of the UK's future energy system is the high price of our energy. Our growth and prosperity depend on having an abundance of cheap, reliable energy. Fundamental questions are being asked of Government, industry and regulators on measures to strengthen energy security, the pace of grid connections, the role of North Sea oil and gas and even the UK's commitment to Net Zero. The UK's ambition of becoming a clean energy superpower depends on reducing electricity prices. The UK desperately needs a solution to help lower its electricity bills - a solution that can harness the nation's abundant and growing levels of intermittent renewable power in a cost-effective way, so it can then be used to replace the expensive gas power that currently dominates the energy prices in our system. The answer lies in large-scale energy storage ("LDES"). Electricity is central to our economic future… The UK is undertaking one of the most profound transformations of its energy system since the Industrial Revolution. The policy path chosen to deliver our legislated Net Zero ambition is a massive transition away from the oil and gas that we use. In its place we plan to use homegrown electricity to power our homes, our transport networks and our industries. And this electricity is to be largely sourced from new homegrown renewable power. That journey has barely begun. Today, electricity accounts for just around 17% of the UK's energy consumption - the same share as 2 decades ago. The Government aims for that figure to be close to 70% by 2050. But electricity must be affordable for a successful transition… For UK households and businesses to transition away from fossil fuels and use electricity instead of oil and gas, the price of our electricity will need to be affordable. Renewables can generate cheap electricity. However, despite almost two decades of subsidies to increase our renewable capacity, this is not translating into lowering our electricity bills which are still on the rise. There is an urgency to reverse this trend. Natural gas still dominates the UK energy market… The first part of the problem that the UK faces is that it is heavily dependent on natural gas. The UK almost always turns to gas-fired power stations to balance its grid and keep the lights on when intermittent renewables supply falls short in meeting demand. Our over-dependence on gas generation matters, because it is gas that ultimately determines the market price of the UK's electricity. Last year, gas set the UK's electricity prices almost 98% of the time. As a result, even when abundant cheap renewable power could be available, UK homes and business are paying prices for their electricity set by gas power generation, and the cost of our supply of gas power has been going up. Running gas power as a back-up system is inefficient… The role of gas power generation in the Uk's energy system has fundamentally shifted in how it is used. Gas power generators have moved from a constant "always on" baseload supply, to a flexible back up supply for renewable power. This has led to a noticeable drop in capacity factors across the 30 GWs of the UK's combined cycle gas turbine fleet, which have plummeted from around 80% in 2000 to around 29% today. Low-capacity factors make for very inefficient gas-fired power generation and higher costs of electricity generation. This, combined with the imposition of new carbon emission levies, means that gas power generators, now need higher wholesale electricity prices to recoup running costs. The cost of gas-fired power has already more than doubled since 2010. Gas power costs are expected to increase further as unabated gas power is further squeezed out of the market. The UK Government's Clean Power 2030 plan targets that gas will only generate 5% of power, yet it aims to retain 30 GW of gas power generating capacity to ensure security of electricity supply. Government estimates for the cost of electricity for new build gas- fired power in this scenario are as much as £410/MWh. The UK's over-reliance on an inefficient and shadow system of gas power generators to back up its renewables is resulting in all our electricity bills rising. Displacing gas power generation with a cheaper source of dispatchable flexible power will be key to bringing down our electricity bills. The UK is using expensive gas imports…. Compounding this problem is the fact that as domestic North Sea production declines, the UK is becoming increasingly reliant on expensive imported LNG. Having once been self-sufficient in gas, the UK now imports about half of its required gas, and by 2030 it will be importing up to 90% of its peak winter gas demand. This means our gas prices, and by association our electricity prices, are increasingly exposed to global energy markets. Recent geopolitical events have demonstrated this risk. The Ukraine and Iran conflicts have driven sharp increases in gas prices