REG - Quadrise PLC - Valkor Project Update

QuadriseAnnouncement

01/08/2024 07:00

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RNS Number : 6811Y  Quadrise PLC  01 August 2024

01 August 2024

Quadrise Plc
("Quadrise" or the "Company")

Valkor Project Update

Quadrise Plc (AIM: QED), the supplier of innovative energy solutions for a
cleaner planet, provides an update on its project with Valkor Technologies
LLC ("Valkor") in Utah, USA, which targets the supply of low sulphur MSAR®
and bioMSAR™ to the marine and power sectors from heavy sweet oil ("HSO").

The State of Utah's Board of Oil, Gas and Mining ("the Board") met yesterday
and approved Valkor's plan to commercialise HSO recovered from sands within
the designated Asphalt Ridge area. The plan details unit operations for
enhanced oil recovery and the establishment of an Enhanced Recovery Unit (the
"Unit Plan") on behalf of project sponsors Heavy Sweet Oil LLC and AC Oil
LLC ("the Sponsors"). The Unit Plan also allows for reduced spacing between
wells, so as to optimise HSO recovery and project profitability.

The Sponsors submitted evidence from the drilling of the first two pilot wells
for a sizeable and common pooled supply of HSO. Commercialisation requires the
use of the latest enhanced oil recovery techniques for low-carbon extraction
and processing. Production of the HSO by Valkor will commence from the pilot
wells using electrical heating initially to maintain oil flow, as the HSO is
extremely viscous otherwise at reservoir conditions. After 1-2 years the
electrical heating will be replaced with steam and CO(2) flooding. This will
provide stable long-term production for 20+ years per well.

HSO samples have been prepared by Valkor and are being sent to Quadrise for
MSAR® and bioMSAR™ formulation and pilot testing in Q3 2024. Commercial
marketing to the marine, utilities and industrial sectors is expected to
commence once successful testing is completed by Quadrise. The initial
marketing targets will be local power producers and marine vessels bunkering
on the US West Coast.

Valkor is now planning to progress with further drilling and HSO production in
accordance with the Unit Plan to support project financing. As previously
advised, once a minimum of US$15 million project finance is raised by
Valkor, they will pay Quadrise US$1.0 million under the terms of the Site
License and Supply Agreement concluded in June 2023. A further US$0.5
million is then due upon delivery of an MSAR® Manufacturing Unit to the
project site in Utah, followed by quarterly payments of US$75,000 for
technology transfer and marketing support.

Commenting on the update, Jason Miles, Chief Executive Officer of Quadrise,
said:

"We are delighted to be notified that Valkor's Sponsors have received approval
from the State of Utah to commercialise heavy sweet oil production. We look
forward to testing the recently drilled oil samples at the Quadrise Research
Facility prior to commercial marketing of the fuels subject to successful
testing. The continued operation  and production from the oil wells will
assist the next phase of customer acquisition and sales.

The adoption of Quadrise energy decarbonisation technology combined with
Valkor's low carbon enhanced oil recovery and production methods will provide
very attractive low sulphur fuels and biofuels with compelling economics and
environmental credentials."

Steven Byle, Chief Executive Officer of Valkor, added:

"We are extremely pleased that our recent drilling program has confirmed
substantial heavy sweet oil deposits are available for commercial extraction
from our Sponsor's leases in Utah.  Our application to establish the Asphalt
Ridge Enhanced Recovery Unit and approve unit operations for enhanced oil
recovery was supported by the Division of Oil, Gas & Mining and the land
owners SITLA. This now allows us to proceed with our initial planned 100+ well
drilling program on optimized spacing  hence we're delighted with the recent
board approval from the State of Utah.

We look forward to securing funding with our Sponsors during the coming months
and to be working with Quadrise to market their fuels and implement their
technology in Utah."

About the Valkor Project

The use of low-carbon extraction and production methods by Valkor
in Utah for the project sponsors is expected to result in heavy sweet oil
with a very low well-to-tank carbon intensity. MSAR® produced using this oil
is calculated to have a 15-20% lower well-to-wake (or well-to-stack) carbon
intensity than conventional very low sulphur fuel oil (VLSFO). The production
of bioMSAR™ using renewable glycerine or other biofuel feedstocks would then
further reduce fuel carbon intensity. The project is well located to supply
local industrial and powerplant consumers, and marine consumers in the west
and gulf coasts of the USA via rail, in line with the Company's shipping
decarbonisation strategy.

 

For additional information, please contact:

 

 Quadrise Plc                                              +44 (0)20 7031 7321
 Andy Morrison, Chairman

 Jason Miles, Chief Executive Officer

 Nominated Adviser
 Cavendish Capital Markets Limited                         +44 (0)20 7220 0500
 Ben Jeynes

 Katy Birkin

 George Lawson

 Joint Brokers
 Shore Capital Stockbrokers Limited                        +44 (0)20 7408 4090

 Toby Gibbs, Rachel Goldstein (Corporate Advisory)

 Fiona Conroy (Corporate Broking)
 VSA Capital Limited                                       +44 (0)20 3005 5000

 Andrew Raca (Corporate Finance)

 Andrew Monk (Corporate Broking)

 Public & Investor Relations
 Cutbill Jacoby

 Andy Cutbill                                              +44 (0)7841 576000

 Georgie Cutbill                                           +44 (0)7850 195353

 

About Quadrise

Quadrise is the supplier of MSAR® and bioMSAR™ emulsion technology, fuels
and biofuels, providing innovative solutions to reduce energy costs and
greenhouse gas emissions today for clients in the global power generation,
shipping, industrial and refining industries.

Learn more at: www.quadrise.com
(https://url.avanan.click/v2/___http:/www.quadrise.com/___.YXAxZTpzaG9yZWNhcDphOm86ZDliYjk0YWMyYzJkMTg2OGJmODhlN2Y5YTIwMzEwOTc6Njo4MGY3OmNiOTg0OWU2Y2NlZWU0NGE3NzYwZTUyMmI4OGQ2ZDJmZWE2NzM1Mzc3YjRkNGYwMTQwMmVhY2E5ZTRkOGQzYjE6cDpU)

 

Follow us on social media:

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This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018 ("MAR") and is disclosed
in accordance with the Company's obligations under Article 17 of MAR.

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