The Chinese solar developer, which has sold off four-fifths of its PV project capacity to state-owned entities, wants the permission of the holders of $420 million of 2024 senior notes to change the terms of their investment so it can buy Ethiopian natural gas from a connected business.

With solar developer GCL New Energy this week redeeming 15% of the 10%-interest bearing senior notes it issued which are due in 2024 – at a cost of US$76.9 million – the company has now announced it wants a majority of the holders of the outstanding US$420 million worth of notes to amend the terms of their investment to allow it to secure an African natural gas supply deal with a related company.

GCL told the Singapore Stock Exchange yesterday it wants to use the money raised by the issue of the notes to pay energy company Poly GCL Petroleum a US$30 million deposit to secure a one-year, exclusive deal to take Poly GCL’s Ethiopian natural gas to fire hydrogen production in a planned plant in Djibouti.

With Poly GCL’s controlling shareholders also having a big stake in GCL New Energy, the terms of the senior notes in question would have to be amended to remove limits on spending their proceeds with affiliate companies and the scope of businesses their proceeds could finance would also have to be expanded to include hydrogen.

GCL New Energy has offered the holders of the notes US$0.002 for each US$1 worth of their investment as an incentive to back the proposal, provided the majority of approvals required is secured before the offer closes, on Feb. 8.

GCL New Energy told the Hong Kong Stock Exchange last month it would pay Poly GCL Petroleum a maximum US$1.1335 per cubic meter of natural gas supplied under the proposed agreement.

The solar developer also announced another 30MW solar project sale to state-owned energy company Hunan Xinhua Water Conservancy and Electric Power Co Ltd on Tuesday, having last year transferred ownership of 10 PV parks with a total generation capacity of 469MW between the two parties.

The latest project sale, like the previous two, concerned a site with unspecified “engineering and compliance defects,” in this case requiring RMB2.28 million (US$360,000) to rectify. The sale will generate a net profit of RMB174,000 (US$27,500) for GCL on the book value of the project and will bring in a net RMB233 million (US$36.8 million), which will be used to pay down debt.