A warm welcome to all joining today's presentation of Aker Horizons second quarter results. I'm Kristian Røkke, CEO of Aker Horizons. Joining me are Nanna Tollefsen, CFO of Aker Horizons, Kristoffer Dahlberg, CFO of Aker Horizons Asset Development Unit, who will review our hydrogen portfolio, and Mary Quaney, CEO of Mainstream Renewable Power, who will present the company's main developments in the quarter. At the end, we'll open up for Q&A. Starting with the bigger picture, we're seeing the energy transition gain momentum across the globe with unprecedented opportunities, but also intricate challenges. Policies and regulations are generally becoming more and more supportive of the transition to net zero, while markets are undergoing profound changes and in some cases, experiencing turmoil. Our performance in this quarter mirrors the dynamicism and complexity of this landscape. Mainstream is currently confronted with obstacles in Chile.
The Chilean part power market, having functioned effectively for 40 years, now faces structural issues. The fallout from the market failure is impacting the entire renewables industry, including Mainstream. As a consequence, the company's Chilean portfolio is in need of restructuring. Our guiding philosophy builds on devising long-term solutions and constructive dialogue with all stakeholders. However, due to the prevailing uncertainty and ongoing restructuring, Mainstream has opted to impair its Chilean assets. Despite the immediate hurdles in Chile, it is important to point out that Aker Horizons remains committed to developing renewable energy, both onshore and offshore. This has been part of our strategy from the beginning, starting with floating wind, and we hold a long-term view towards developing the industry across technologies. The highlight among this quarter's achievements is Aker Carbon Capture's EUR 200 million contract with Ørsted.
I'll speak more to this later. I want to mention here already as evidence of green industry picking up steam. Carbon capture has experienced a massive positive momentum over the past six months. In the hydrogen sphere, progress has also been positive, with a substantial grant awarded to our early mover project in Duqm, a major PPA signed for Narvik, offtake further develop, and support mechanisms being more tangible in our key target markets in Europe. Moving on to Aker Carbon Capture. In May, the company secured its largest contract to date, five modular Just Catch units for Ørsted in Denmark. The value of this contract exceeds EUR 200 million and increased Aker Carbon Capture's revenue backlog to NOK 3.3 billion. As it stands, ACC now has a total of seven units under development.
Early-stage activity is picking up, with secured studies in biomass industries in the U.S. and Sweden, as well as two studies for Just Catch Offshore, which is an interesting new segment for ACC. For the main projects under construction, several milestones were reached. At Ørsted, key purchase orders were placed. For Brevik CCS, the installation of equipment and piping continues, and at Twente CCU, all major equipment has been installed on-site. In addition, ACC's U.K. flagship FEED and pre-FEED projects are in the final negotiations for government support. Diving deeper into our new flagship project in Denmark. At Ørsted Kalundborg Hub CCS, Aker Carbon Capture is set to deliver five modular and configurable third-generation Just Catch 100 units, alongside additional equipment such as liquefaction systems and temporary CO2 storage, and an on/offloading facilities. This contract is a result of the MOU signed among Ørsted, Aker Carbon Capture, and Microsoft in March 2021.
The carbon capture facilities will have design capture capacity of half a million tons CO2 per year, with CO2 to be stored in Northern Lights storage reservoir in the North Sea. As the five JustCatch units will capture biogenic emissions, this landmark project will deliver large-scale carbon removal. Microsoft has committed to purchasing 2.76 million tons of high-integrity carbon removal credits from the project, marking one of the world's largest carbon removal offtake agreements by volume to date. At Aker Horizons, we view the project as more than a milestone for seal of production of JustCatch units. We also view it as a groundbreaking CCS project for the industry, covering the broader value chain, bringing together government, technology providers, industry leader, and carbon credit buyers. Aker Carbon Capture also made headway in new markets and new industries in the quarter.
In the US, the company secured a strategic study covering biogenic emissions, targeting 800,000 tons of CO2 per year. This includes an assessment of two Just Catch™ 100 units. A combination of Just Catch™ 100 and 400 units or a Big Catch™ are potential solutions for this client to help decarbonize its business. This is a notable award given the potential we see in the US CCS market. In Sweden, Aker Carbon Capture secured a study for Söderenergi to help decarbonize the country's second-largest biomass combined heat and power plant. This project offers the potential to capture 500,000 tons of biogenic emissions. In Europe, Aker Carbon Capture enhanced its position to the waste-to-energy sector with a new study. This aims to capture between 200,000-400,000 tons CO2 per year, and together with its client, the company will explore options across the Just Catch™ portfolio.
ACC also secured two Just Catch Offshore studies, including one for Petoro's power hub in Norway, targeting 720,000 tons CO2 per year. Last October, Just Catch Offshore, the company's modularized facility for offshore installations, was successfully qualified by DNV, the global independent energy expert and assured provider. It is now ready to be deployed in offshore oil and gas fields to significantly reduce emissions from offshore power generations. Recent market developments lend credence to an optimistic outlook for CCUS globally. According to recent data from the IEA, a spate of projects in the U.S., Europe, and China, reaching FID, contributed to CCUS investments, hitting a record $3.1 billion in 2022. To illustrate the scale of the potential, if all projects currently in advanced planning stages adhere to their schedules and take FID, global CCUS spending could reach $34 billion by 2025.
This could raise global CO2 capture capacity from around 45 million tons CO2 per year today to over 300 million tons CO2 per year by 2030. Projects spreading across different sectors have surfaced, with a growing share related to hydrogen and industrial use. Since January 2022, over 180 projects have been announced along the CCUS value chain, signifying a transformation in the prospects for CCUS investments. Geographically, the U.S. and Europe dominate the announcements of new projects, with both markets galvanized by recent public support packages. In the U.S., the tax incentives offered by the IRS, coupled with proposed emission rules for power plants, are set to expedite CCUS investments. The policy backdrop in Europe took a significant leap forward this quarter.
France released its carbon capture, storage, and utilization strategy to achieve carbon neutrality by 2050. Germany unveiled its funding program for climate protection contracts. These crucial measures will catalyze industrial decarbonization across the continent. Moreover, the target set by the EU's proposed Net-Zero Industry Act to develop storage capacity of 50 million tons CO2 by 2030 will further increase the likelihood of planned projects reaching FID. In summary, there are clear signs that the CCS market is growing. Aker Carbon Capture has been fortunate to experience a jump start and has built the right set of capabilities to successfully navigate this rapidly accelerating market. Now, lastly, I'd like to express my heartfelt thanks and appreciation to Valborg Lundegaard, who stepped down as CEO of ACC due to health reasons.
She has been such an inspiration to work with. I speak on behalf of the entire Aker Carbon Capture and Aker Horizons organizations in saying this. She's been a leader for the broader CCUS industry. Specifically with ACC, she's left the company in better shape than ever. We're obviously not going to go into personal details. She needs to focus on her health for the next period. Upon return, we are fortunate to have access to Valborg as a senior advisor. We would have loved and preferred to see her continue for many years to come. We are incredibly fortunate to have Egil in position to take the CEO role. I personally and the ACC board have all the confidence in Egil to take this exceptional starting point in ACC to new heights.
With that, I'll hand it over to Kristoffer to present the developments in our hydrogen portfolio.
Thank you, Christian. Asset development is continuing to mature the project portfolio, we're very happy to announce several significant highlights as we close off Q2. Both the Rjukan Green Hydrogen and Narvik Green Ammonia projects made great progress in the period, we will present each one of them, starting with Rjukan. On the commercial side, it was a big achievement to be awarded up to NOK 85 million in a grant and a further NOK 50 million in green loans from Innovation Norway. The award demonstrates the maturity and competitiveness of the project. Financial support like this is key to enable and de-risk first-mover projects like Rjukan. Commercial progress was also made with regards to our partnership strategy. We are in advanced negotiations with a leading industrial gas company to join the project, bringing key competence and potential offtake.
Technically, we are closing in on selecting the concept for the plant and expect to award key contracts shortly. Moving to Narvik, our large-scale green ammonia project. Also here, commercial progress was significant in the quarter as we signed a 10-year power purchase agreement with Statkraft, de-risking a key cost component and also adding transparency on the overall competitiveness and profitability of green ammonia. We doubled our offtake LOI backlog to over 3x the full production volume, indicating strong demand from solid international counterparties for green ammonia from Narvik. We have also signed a joint development agreement, bringing in an industrial partner, demonstrating the attractiveness of the project, adding competence to the development team, and also reducing our dev spend. On the technical side, we have completed the feasibility studies and are now moving into the concept select phase.
In the north of Norway, and predominantly in the Narvik area, we are also developing eight industrial sites for green industry through our Aker Narvik company. Some of these sites we will use ourselves and some we will lease to others. We are nearing completion of the Kvandal site with 230 MW of green power ready to use and are in advanced dialogues with customers to lease part of this site. Looking at our other key projects, we are happy to see positive developments also here. At Aukra, the feasibility study led by Gassco for a hydrogen pipeline connecting the west coast of Norway with the demand centers in Germany was completed in the quarter. The study concluded that it's technically feasible, which is an important step to realize it and open a potential significant demand for hydrogen from Aukra.
Further on blue hydrogen, we see strong offtake interest also from our H2 Gateway project in the Netherlands. Blue hydrogen is gaining traction as a key part of the solution, and this project is very well placed to serve an anticipated emerging European market. We are very pleased with the support we received for our Rjukan project, and are also glad to see the continued tailwinds in the regulatory landscape for hydrogen in the EU. The framework to reach the EU's target of a 20 million ton clean hydrogen market in 2030 is starting to shape up well. The revised EU directive on emission trading, ETS, entering into force, and the agreement on the Renewable Energy Directive are both very important to realize this large market. Germany is a key driver also on the incentive side, and is allocating considerable amounts of capital to boost demand for clean hydrogen.
A lot is happening on the supply chain side as well. Electrolyzer production capacity is expected to record a tenfold increase by the end of this year compared to 2020. This increase in manufacturing capacity indicates that the gap between aspirational projects and actual feasible hydrogen derivative projects is narrowing, driven by policies and regulations and technology development. Thank you for your attention, and with that, I leave the word to Marie.
Thank you. I will take you through Mainstream's developments during Quarter Two, and I will start with the key highlights. We now have 1.1 GW of fully operational wind and solar assets delivering power to the Chilean grid, 0.3 GW of which reached commercial operation in Q1 of this year. Reaching over 1 GW of renewable operational capacity is a significant milestone in the delivery of the 1.4 GW Andes Renovables platform. The Andes platform continues to face severe market challenges, but our mitigation strategy is progressing. In Q2, we saw reduced losses compared to previous quarters, with the starting effect of some of these mitigation factors, which I will discuss more on the next slide, combined with increased generation, reduced system costs, and lowering fossil fuel prices.
Market uncertainty remains, and we are engaged in constructive dialogue with lenders on the debt restructuring of the Andes portfolio. Due to this continued uncertainty and the ongoing restructuring, we have recognized an impairment net of tax of EUR 359 million on the Andes Renovables assets. I'll discuss our Chilean mitigation strategy and the impairments in more detail on the following slide. Offshore development opportunities continue, with two applications submitted in Sweden and one in Australia. In South Africa, we signed a corporate power purchase agreement for 100 MW with an industrial offtaker, our first private sector offtake agreement in this market, and which is now progressing towards financial close.
Our global pipeline now stands at a net 20.8 gigawatts, compared to 16.9 gigawatts at the same time last year. This increase comes mainly from the addition of ScotWind in Q3 of last year and early-stage development projects in both South Africa and Australia. We believe this pipeline positions us well to benefit from improving industry backdrop, as recent auctions across several markets demonstrate both increasing power prices and improved return profiles. We continue our approach of bringing projects to FID only where our investment return hurdles are achieved. Moving on to Chile. As discussed in detail during our Q1 presentation in May, we are engaged in ongoing and intensive dialogue with the regulator and with government at the most senior levels to achieve market mitigation measures.
While all stakeholders agree that change is required, regulator and government responses proposed to date have been insufficient to fully resolve the immediate nature and scale of the issues, with the renewables sector in Chile remaining unduly exposed to the pricing volatility and to system costs. For Mainstream directly, our mitigation strategy is multifaceted. In June, our Copihue Energía portfolio agreed with Chile's national electricity coordinator, the temporary withdrawal of the Kaman Wind Farm distribution company PPA from its participation in the short-term power market due to delays in its construction that have been caused by a range of external factors beyond our control. This specifically relates to construction of the Kaman Wind Farm.
This temporary withdrawal, which is effective from June first, now facilitates a reduction in Mainstream's exposure to the power losses from this PPA until the point at which construction is completed and the project enters into commercial operations. Unfortunately, construction of the Kaman Wind Farm has been further disrupted following an arson attack on the project site. No injuries have been reported. However, as a result, all construction activity is currently paused. A second mitigation measure is relevant to Kuri, a project within the Huemul portfolio. A submission was made to Chile's National Energy Commission, the CNE, requesting the termination of Kuri's distribution company, PPA, due to force majeure grounds. The main cause of this force majeure arises from the discovery of important archaeological findings that resulted in Chile's National Monuments Commission, the CMN, halting all works on site pending ongoing archaeological survey works.
The company has had an ongoing constructive engagement with the CMN and is focused on completing these archaeological works and their impact on the remainder of the construction program, with the aim of completing construction of the Ckhuri Wind Farm. The CNE has issued a decree which validates the force majeure for the Ckhuri project, which in turn triggers the termination of its distribution company, PPA. We are now in the process of terminating the PPA with the distribution company counterparts, and this process is well progressed and is expected to conclude before the end of this quarter. Once concluded, this would represent the cancellation of over 20% of contracted PPA volume for the Huemul portfolio. Additionally, when operational, future energy exported from Ckhuri can then be sold into the spot market at potentially higher prices, thereby improving the economics of the overall Andes portfolio.
I would like to thank our Chilean team for their diligent work here, as this will be the first time that a force majeure event has been applied to terminate a distribution company, PPA, in Chile. This termination of the Ckhuri PPA and the suspension of the Kaman PPA, in parallel, we have appointed a financial advisor to support with negotiating a capital restructuring with the lenders to the Andes Renovables platform. A constructive dialogue continues with these lenders on the long-term capital structure for the platform. However, certain defaults exist across these facilities. We entered a standstill agreement at the end of May, which is a period in which we are negotiating a debt restructuring of the Andes Renovables platform and temporarily waived defaults at quarter end, and the debt has been reclassified as current liability at 30 June.
In agreement with the lenders, the interest rate swaps were terminated in June, generating $170 million of net proceeds, net of transaction costs, and the use of such proceeds to be determined pending the final outcome of the debt restructuring. As of quarter end, as of 30 June, we have recognized an impairment net of tax of EUR 359 million on the Andes Renovables' assets due to the continued market uncertainty and the ongoing restructuring. This follows a conservative approach towards the impairment testing, recognizing that there is a wide range of potential outcomes. Now on to key portfolio updates and moving to South Africa. We remain focused on bringing the Round 5 projects to market in a staged manner, subject to meeting our investment hurdle rates for these projects.
Our recently signed corporate PPA in South Africa with an industrial offtaker with a capacity of 100 MW, is progressing towards financial close. We see significant opportunities for growth in the corporate PPA sector in South Africa, as such, we are in active discussions with a number of potential private offtakers. In the Philippines, our Libmanan onshore wind project is now in late stage development and is targeted to start construction in 2024. Australia, which is an increasingly attractive renewable energy market and for which we are pursuing both an onshore and an offshore strategy. I'm pleased to say that our focus to secure attractive onshore wind pipeline is progressing well, having now secured attractive greenfield development sites of 1.5 GW across two locations in Queensland.
Moving to offshore wind and starting in Aker's home market, Norway, our team and partners are working diligently in preparation to finalize our applications. As a reminder, at the end of March, the government officially opened the application window for the country's first and highly anticipated offshore wind tender, with a total capacity of 3 GW. For the Sørlige Nordsjø II , we are working with our partners, BP and Statkraft, and for Utseira Nord, which is a floating offshore wind area, our team is working with our partners, Ocean Winds and Statkraft, with both application deadlines now aligned to the first of September.
In Sweden, a market which plays to our strengths as a developer-led market, their parliament passed in June a new target of 100% fossil-free electricity from 100% renewables, combined with a target to double the country's electricity production by 2040. For Mainstream in this market, we continue to progress 4 offshore wind projects with our partner, Hexicon, in our 50/50 Freja Offshore joint venture. Last month, we submitted a planning application for Cirrus, a predominantly bottom-fixed site in the Baltic Sea off the southeast coast of Sweden, with a capacity of up to 2 GW . This follows our application in April for the Mareld floating wind farm, located on the west coast of Sweden, near the border of Norway. This development has the capacity of up to 2.5 GW.
In Australia, we have established a very strong offshore wind consortium with AGL, the largest electricity generator in Australia, with Reventus Power, a CPP IB portfolio company focused on offshore wind energy transition infrastructure opportunities, and with DIRECT Infrastructure, an Australian specialist offshore wind developer. Our consortium submitted a 2.5 GW license application in April for the Gippsland area, which is Australia's first declared offshore wind zone, and we're expecting a decision by the end of the year on this. In South Korea, our KF Wind's draft EIA report was now been approved by stakeholders and authorities at the end of June. The teams are now focused on achieving final EIA approval.
Finally, in Vietnam, the Power Development Plan 8, otherwise known as PDP8, has received approval on May 15th. This is a key milestone. We're particularly encouraged by its ambitious targets for increased offshore wind capacity in Vietnam over the coming years. For our pipeline, this has direct positive implications for our net 1.3 GW offshore development pipeline in Vietnam, made up of Soc Trang and our Bến Tre projects. Finally, to our project pipeline, which now stands at 20.8 GW. On a year-on-year basis, this has grown by 4 GW, reflecting the additions of ScotWind in Q3 last year and from early stage development projects in South Africa and in Australia. Our later stage projects have continued to mature with over 2 GW of this development pipeline at a pre-construction ready status.
Operationally, we now have 1.1 GW in full operation, an increase of 0.4 GW since the same period last year, driven by the increasing level of Andes Renovables projects reaching commercial operations. Despite the challenges we are working through, we believe this pipeline positions us very well to benefit from an improving industry backdrop, as recent auctions across several markets are demonstrating both increasing power prices and improving return profiles. We will continue our approach of bringing projects to FID only where our investment return hurdles are achieved. With that, I hand you to Nanna.
Thank you, Mary. In the quarter, net asset values decreased from NOK 15.8 billion in Q1 to NOK 11.81 billion at the end of Q2. This decrease was driven primarily by an impairment of Aker Horizons book value of the investment in Mainstream, which prompted a shift from referencing the last transaction value to referencing the book value. In the quarter, Aker Horizons and holding companies recognized an impairment of NOK 2.3 billion, resulting in an adjusted book value of NOK 7.7 billion for our 58.4% shareholding in Mainstream. Consequently, this revised book value of NOK 7.7 billion is now incorporated into our net asset value, replacing the previous reference to the latest transaction value. The impairment was triggered by the ongoing restructuring in Chile.
The book value now implies a Mainstream valuation of EUR 1.1 billion on a 100% basis. The valuation methodology is based on a risked discounted cash flow analysis, with cost of capital calculations based on Damodaran and standard market practice. We see significant value creation in the project portfolio, with expected returns above cost of capital in key projects and late-stage developments, such as in South Africa, the Philippines, South Korea, and Sweden. There have been other adjustments to the net asset value, reflecting various factors. These include a 5% decline in the share price of Aker Carbon Capture during the quarter, as well as operating costs and interest expenses. The next slide shows Aker Horizons parent and holding companies key financials for the second quarter. EBITDA was negative NOK 25 million in Q2, reflecting general overhead in Aker Horizons.
The net profit was negative NOK 2.6 billion, reflecting also the impairment of the investment in Mainstream, the share price development of Aker Carbon Capture, and net other financial items, mainly interest income and interest costs. Cash flow from operating activities consists of running costs and interest received and paid, amounted to negative NOK 64 million in the quarter, also representing a negative working capital effect in the quarter. Investing cash flows consists of investments in our green projects in Narvik and in asset development. The net cash flow for the quarter was negative NOK 97 million. The cash balance was reduced from NOK 3.8 billion to NOK 3.6 billion. This brings us to available liquidity. The RCF of EUR 500 million was undrawn at quarter end.
With a cash position of NOK 3.6 billion and the RCF undrawn, that sums up to available liquidity of NOK 9.4 billion. This is down slightly from Q1 at NOK 9.5 billion, as the cash position is reduced, which was partially countered by a weakening of the Norwegian kroner versus the euro, which the RCF is denominated in. The net interest-bearing debt position was up from NOK 2.3 billion at Q1 to NOK 2.6 billion at Q2, reflecting operating costs, interest paid and accrued, and investments in our green projects. Summing up, Aker Horizons has gross asset values of NOK 17.3 billion, net interest bearing debt of NOK 2.6 billion, and available liquidity of NOK 9.4 billion.
The loan to value RCF covenant is defined as net senior debt over gross asset value, and stood at -8% at Q2 with significant headroom to the covenant of 50%. That brings us to an end, and we open up for Q&A.
Thank you, Nanna. My name is Marianne Stigset. I'm head of communications at Aker Horizons, and I'll be taking you through the Q&A session for today. Just as a reminder, you can email any questions you may have to ir@akerhorizons.com. The first question we have pertains to the impairment on Mainstream. The question is: Why should Aker Horizons shareholders feel comfortable in the current valuation of Mainstream? Can you confirm no further impairments will be necessary? Nanna, will you take that question?
Yes. Thank you, Marianne. The impairment made to Aker Horizons book value is based on a risk-discounted cash flow analysis that values the company. That means that we take bottom-up cash flows for the projects, where the value of a project depends largely on the spread between the rate of return and the cost of capital. For valuation of development projects, we also apply a risk factor based on the level of maturity of the individual project. To determine cost of capital, we follow a widely accepted market practice approach, where we use a Damodaran methodology to derive country-level cost of capital based on relative risk. The impairment reflects a conservative approach for the current best estimate of the valuation of Mainstream. It's important to note that we do see significant value in Mainstream as a platform and in Mainstream's development portfolio.
The company has a substantial volume of projects in late-stage development, in addition to a significant cash position.
Do you have any further details that you'd like to add, Paul?
Thank you. I think I would just maybe say that we've seen cycles like this in the industry before. As Mary mentioned in her section, in generally, we're receiving an improving industry backdrop with increasing power prices and improving returns. I mean, our diversified portfolio approach does provide us with some security here, countering some of the challenges we're seeing in Chile. With late-stage activity, such as the examples of the corporate PPA in South Africa, very positive activity in the Philippines with the targeted construction and plans for an onshore wind project in 2024. Those factors, combined with earlier-stage offshore opportunities, and from our past, we know that these can be huge value creators, so I certainly remain positive about our outlook.
Good. Thank you, Paul. Our next question is regarding the PPA that we recently signed. You signed a PPA recently for the Narvik Green Ammonia project. What is the significance of this contract, and do you now have the power you need to proceed with FID? Kristoffer, do you want to take this one?
Thank you, Marianne. Securing long-term power on attractive terms is a key enabler for our projects, and this marks an important milestone to realize our ambitions in Narvik. The contract is for a substantial amount of the power needed, helps de-risk the project, and creates added transparency on the cost side, which, again, is key for pricing the ammonia towards our customers. Securing feedstock on fixed prices is key for us to develop financeable projects and being able to sell volumes on fixed prices to our customers. It's also a key input in the business case, and I'm happy to say that the power prices and ammonia prices we see lend support to a good business case.
Thank you, Kristoffer, and actually, the next question is also for you. It's, if you could add some more color to the outlook for the hydrogen market.
Yeah. First, I would say that the support mechanisms, as mentioned in the presentation, is starting to shape up well, and these are key for the first projects, the EU Innovation Fund and the Hydrogen Bank being two concrete examples relevant to our projects. Also increasing ETS prices and expanded scope for these are also important drivers. All these are key to help realize EU's target of a 20 million tons clean hydrogen market in 2030, which is our target market for our project. That's on the macro side. On the demand side, we also see positive signals. We have now LOIs for 3x the production volume from Narvik, and we have also LOIs from Rjukan.
Both signals ink on paper from very solid international companies, which are positioning themselves to take a position in the hydrogen and ammonia market. Our impression from the customer dialogue is that demand will become very strong, as hydrogen is a key decarbonization tool in the hard-to-abate industries.
Thank you very much, Kristoffer. Those seem to have been the questions we've received, so, with that, I thank you all for joining and wish you all a very good summer.