Tidal power specialist Atlantis Resources has said it is progressing well on plans to start construction of its flagship MeyGen project in the Pentland Firth in the second half of this year.

In its first annual results since listing on the Alternative Investment Market (AIM) in February the business confirmed its plans to have a turbine installed under the sea between the mainland north of Caithness and the island of Stroma by next year.

The results for 2013 showed its revenue more than doubled from £1.4 million to £2.9 million with operating losses widening from £5.75 million to £6.5 million.

Loading article content

Tim Cornelius, chief executive, said: "Following the successful fundraising and admission to AIM in February 2014, the group is well placed to continue the development of its cornerstone MeyGen project in Scotland, the world's largest tidal energy power project.

"We have made significant progress since February in finalising the construction and supply contracts for MeyGen, and in reaching agreement with the project funding syndicate in readiness for financial close and the commencement of construction.

"Excellent progress has been made on the detailed design of our AR1500 turbine with Lockheed Martin with the programme on track for completion in October of this year and the first AR1500 turbine to be installed at MeyGen in [the second half of] 2015."

The whole first phase of the project will see up to 86 turbines, which stand 25 metres in height and can generate up to 1.5 megawatts, installed.

However the initial demonstration array is expected to consist of four of the structures. There is consent for up to 368MW of power to be generated by the end of the decade which would be enough to keep the lights on in hundreds of thousands of homes.

Atlantis is the 100 per cent owner of the MeyGen project following the acquisition of shares from Morgan Stanley and GDF Suez subsidiary International Power Marine Developments in October last year for around £386,000.

Following a share transfer earlier this year MeyGen is now fully owned by Atlantis subsidiary Atlantis Projects Pte.

The Atlantis accounts note a goodwill related gain on the deal of around £8 million which it said was the result of the future revenue growth which is forecast to be realised from the development.

Around 50 per cent of the £12 million of new equity Atlantis raised through the AIM-listing has been earmarked for developing the Scottish site. The company has also secured various multi-million pound grants to develop MeyGen in recent years.

Atlantis, which has its headquarters in Singapore, is also working on tidal schemes in China, Canada, India and Australia but its Scottish interests are at the most advanced stage.

The shares made their debut on AIM at 94p but slipped below 90p in mid-March and have yet to recover. Yesterday they fell 0.5p, or 0.75 per cent, to 66.5p.