REG - EQTEC PLC - Joint Venture with CompactGTL

EQTECAnnouncement

16/01/2024 13:30

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RNS Number : 8831Z  EQTEC PLC  16 January 2024

16 January 2024

 

EQTEC plc

("EQTEC", the "Company" or the "Group")

 

Joint Venture with CompactGTL towards new business in

renewable synthetic fuels, including sustainable aviation fuel

 

EQTEC plc (AIM: EQT), a global technology innovator powering distributed,
decarbonised, new energy infrastructure through its waste-to-value solutions
for hydrogen, biofuels, and energy generation, is pleased to announce that it
has set up a new joint venture company (the "JV") with CompactGTL Limited
("CompactGTL") (together with the Company, the "Partners"), a leading, small
scale, modular, gas-to-liquids technology company specialising in the
production and use of synthetic fuels from gases, including natural gas,
synthesis gas and off-gases. The JV will pursue implementation of an
integrated, waste-to-liquid fuel solution based on EQTEC syngas technology and
CompactGTL gas-to-liquid conversion technology (the "Solution").

 

The JV is owned in equal shares of 50% by the Company and CompactGTL. The
Partners intend that the JV become an innovator and licensor of technology for
liquid fuels produced from waste, including transport fuels such as
sustainable aviation fuel ("SAF"). The JV's immediate objective is formation
of a consortium of investors to fund a commercial-scale, first-of-a-kind
reference plant that proves the viability of the Solution (the "Reference
Plant"). The Solution would enable new lines of business for both Partners.

 

Establishment of the JV represents a next step following work undertaken by
the Partners under the collaboration framework agreement announced by the
Company on 7 July 2022 (the "CFA"). Under the CFA, the Partners agreed to
collaborate for the design, development, construction and operation of
waste-to-fuel projects and other synthetic fuel and energy infrastructure
projects, with an initial focus on small-scale, modular, waste-to-fuel plants.

 

Since execution of the CFA, the Company and CompactGTL have together pursued
funding, identified project opportunities and undertaken joint design and
costing to build gas-to-liquids R&D capabilities at EQTEC's syngas pilot
plant at the Université de Lorraine's Laboratoire d'Études et de Recherche
sur le Matériau Bois ("LERMAB") facility in Épinal, France.

 

The Partners have also completed feasibility work toward the Reference Plant,
through which they confirmed that the modular and scale capabilities of both
EQTEC and CompactGTL technologies allow for construction of the Reference
Plant and subsequent plants at lower cost and shorter timescales than has been
possible by other waste-to-liquid configurations. The Reference Plant is
expected to process 150 tonnes per day of refuse-derived fuel from municipal
waste ("RDF") to produce 160 barrels per day of synthetic crude ("syncrude")
at 90% annual operational efficiency. If processed, the syncrude would be
further refined to produce c. 11,700 litres per day of SAF, c. 8,650 litres
per day of diesel and c. 5,000 litres per day of naphtha. The total Capex for
building the Reference Plant estimated through the feasibility work is c. £60
million, with roughly a third of that for purchase of EQTEC technology and
another third for purchase of CompactGTL technology.

 

As the Partners intend to go to market through the JV with an integrated,
waste-to-liquid fuel solution proven through the Reference Plant, the Solution
is expected to significantly de-risk projects seeking reliable, SAF or other
liquid fuel capabilities. The Partners intend to apply the Solution in support
of the ground transport, airline and other industries.

 

The Partners have already identified a number of potential investors for both
the R&D integration at LERMAB and for the Reference Plant and through the
JV will pursue closure of funding, at project level, and development of the
Reference Plant. The Company will make additional announcements in due course
about work at LERMAB and work on the Reference Plant.

 

David Palumbo, CEO of EQTEC, commented:

 

"The versatility of EQTEC's syngas technology makes renewable synthetic, or
drop-in, fuel production possible. But more than that, the quality of syngas
that EQTEC technology enables is likely to result in a much better performance
of the gas-to-liquid reactors than other syngas technologies could offer. That
would mean a higher yield of liquid fuel from a lower volume of feedstock,
higher productivity and efficiency and greater commercial returns.

 

"We are still at the early stages of our work on drop-in fuels, but the
potential is great. CompactGTL's gas-to-liquid capabilities are already proven
for natural gas and now we will work towards proving them for waste-to-liquid
fuels, including SAF and maritime fuels. Given the huge interest in SAF and
other drop-in fuels in the market and the funding we can see going into this
market, waste-to-liquids is a market in which we want to participate as soon
as possible."

 

Anar Asgarov, CEO of CompactGTL, commented:

 

"CompactGTL's technologies have already established a strong track record in
the fossil fuel world, and we are dedicated to establishing an even better
record with renewables. The market for clean transport fuels is growing
quickly and we want to be at the forefront of it.

 

"Gas-to-liquid technology is difficult, but we have made it work. The bigger
problem to solve for is high quality syngas, which is why we have turned to
EQTEC, who have made high-quality syngas work. We look forward to combining
two successful technologies and making them work together. We believe this
joint venture is the beginning of something truly exciting for the renewables
sector and especially for liquid fuels."

 

This announcement contains inside information as defined in Article 7 of the
EU Market Abuse Regulation No 596/2014, as it forms part of United Kingdom
domestic law by virtue of the European Union (Withdrawal) Act 2018, as
amended, and has been announced in accordance with the Company's obligations
under Article 17 of that Regulation.

 

ENQUIRIES

 

 EQTEC plc                                      +44 20 3883 7009

 David Palumbo / Jeffrey Vander Linden

 Strand Hanson - Nomad & Financial Adviser      +44 20 7409 3494

 James Harris / Richard Johnson

 Global Investment Strategy UK Ltd - Broker     +44 20 7048 9045

 Samantha Esqulant

 Fortified Securities - Broker                  +44 20 3411 7773

 Guy Wheatley

 Panmure Gordon - Broker                        +44 20 7886 2500

 John Prior / Hugh Rich

 

About CompactGTL

 

CompactGTL ("CGTL"), with headquarters in the UK, is one of the world's
leading, small scale, modular gas-to-liquid (GTL) companies. Since its
inception in 2006, CGTL has focused its technology development and
commercialisation programme on the upstream oil & gas sector, recognising
problematic stranded gas as the most compelling market opportunity.

 

CGTL has focused its development activities on delivering what commercially
viable plants need to achieve and has developed a unique, patent- protected
and proven GTL process utilising Fischer Tropsch (FT) catalytic conversion.
The CGTL small- scale GTL technology has been proven to work for the
conversion of associated gas into synthetic liquids at the point of
production. The technology has powerful oil company endorsement by Petrobras
who successfully operated CGTL's Commercial Demonstration Plant for 3 years in
Brazil.

 

CGTL sees a huge new opportunity to transition the company from a focus on
primary fossil derived feedstocks to a focus on biogenic feedstocks, such as
residual biomass, refuse derived fuels and municipal solid wastes, that can be
turned into valuable and sustainable liquid fuels. To achieve this CGTL has
partnered with EQTEC and believe that there are significant synergies in the
integration of CGTL's FT technology and EQTEC's proven ability to produce high
quality synthesis gas from a range of feedstocks.

 

About EQTEC

 

As one of the world's most experienced thermochemical conversion technology
and engineering companies, EQTEC delivers waste management and new energy
solutions through best-in-class innovation and infrastructure engineering and
value-added services to owner-operators. EQTEC is one of only a few technology
providers directly addressing the challenge of replacing fossil fuels for
reliable, baseload energy. EQTEC's proven, proprietary and patented technology
is at the centre of clean energy projects, sourcing local waste, championing
local businesses, creating local jobs and supporting the transition to
localised, decentralised and resilient energy systems.

 

EQTEC designs, specifies and delivers clean, syngas production solutions in
the USA, EU and UK, with highly efficient equipment that is modular and
scalable from 1MW to 30MW. EQTEC's versatile solutions process 60 varieties of
feedstock, including forestry waste, agricultural waste, industrial waste and
municipal waste, all with no hazardous or toxic emissions. EQTEC's solutions
produce a pure, high-quality synthesis gas ("syngas") that can be used for the
widest range of applications, including the generation of electricity and
heat, production of renewable natural gas (through methanation) or biofuels
(through Fischer-Tropsch, gas-to-liquid processing) and reforming of hydrogen.

 

EQTEC's technology integration capabilities enable the Group to lead
collaborative ecosystems of qualified partners and to build sustainable waste
reduction and green energy infrastructure around the world.

 

The Company is quoted on the London Stock Exchange's Alternative Investment
Market (AIM) (ticker: EQT) and the London Stock Exchange has awarded EQTEC the
Green Economy Mark, which recognises listed companies with 50% or more of
revenues from environmental/green solutions.

 

Further information on the Company can be found at www.eqtec.com
(http://www.eqtec.com/) .

 

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