REG - Velocys PLC - UK Government SAF Revenue Certainty Scheme Update

VelocysAnnouncement

05/09/2023 11:00

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RNS Number : 4436L  Velocys PLC  05 September 2023

News release

 

Velocys plc

 

("Velocys" or "the Company")

 

5 September 2023

 

 

 

 

UK Government SAF Revenue Certainty Scheme Update

 

Velocys plc (VLS.L), the sustainable fuels technology company, welcomes
yesterday's announcement by the UK Department for Transport ("DfT") confirming
its commitment to introduce a revenue certainty scheme ("Scheme") for
Sustainable Aviation Fuel ("SAF"). The DfT will launch a consultation on the
design and delivery of the Scheme, which should attract further investment
into the UK SAF industry.

A SAF Scheme is expected to be highly beneficial to the Altalto Immingham
project as it sends a positive long-term signal to investors which will
underpin the financing of plant construction. The project is making good
progress through its Front End Engineering Design (FEED) stage, including the
conclusion of license and engineering service agreements with key technology
licensors, supported by a £27 million grant from the DfT under the Advanced
Fuels Fund as announced in December 2022. Discussions remain ongoing with
private sector investors to obtain the required remaining matched funding to
be in place by the end of the year.  

The DfT's announcement also states that the Scheme will work alongside the SAF
mandate to be introduced in 2025 and reaffirms the Government's intention to
have five UK SAF plants in construction by that year.

 

 

Henrik Wareborn, Velocys CEO, said:

"Yesterday's announcement is very positive for the UK SAF industry and
especially for the Altalto project. Thanks to our progress with engineering
and licensor engagements, Altalto is leading the way as the furthest developed
within the group of projects supported under the Advanced Fuels Fund. It
stands to benefit from the revenue certainty scheme as well as from the SAF
mandate.

 

This commitment from the Government is a major step towards unlocking the
capital required to further fund SAF projects in the UK. As noted by the
Department for Transport (DfT), this revenue certainty will provide SAF
producers greater assurance over the earnings from the SAF produced in
projects such as Altalto, enabling projects to attract the necessary finance.
We look forward to engaging further with the DfT and seeing more detail on the
mechanism and the timescale in order for the Government target of five plants
in construction by 2025 to be met."

 

https://www.gov.uk/government/news/new-measures-to-support-sustainable-aviation-fuel-industry
(https://protect-us.mimecast.com/s/CCuuCJ6l0NIWNzMsV4Xog)

 

 For further information, please contact:

Velocys

 Henrik Wareborn, CEO

 Philip Sanderson, CFO

 +44 1865 800821

 Panmure Gordon (UK) Limited (Nomad and Joint Broker)

 Hugh Rich (Corporate Broking)

 Emma Earl (Corporate Finance)

John Prior (Corporate Finance)

 +44 20 7886 2500

 Shore Capital Stockbrokers Limited (Joint Broker)

 Henry Willcocks (Corporate Broking)

 Toby Gibbs (Corporate Advisory)

 James Thomas (Corporate Advisory)

 +44 20 7408 4090

 Radnor Capital (Investor Relations)

 Joshua Cryer

 Iain Daly

 +44 20 3897 1830

 Buchanan (Financial PR)

 Helen Tarbet

 Simon Compton

 +44 20 7466 5000

 

 

Notes to Editors

 

Velocys is an LSE-listed, international sustainable fuels technology company,
traded on the AIM, providing customers with a technology solution to enable
the production of negative Carbon Intensity synthetic, drop-in fuels from a
variety of waste materials. Synthetic fuel is the only commercially available,
permanent alternative to fossil aviation fuels. The Velocys technology is
IP-protected in all major jurisdictions.

Two reference projects (Bayou Fuels, US, and Altalto Immingham, UK) are
designed to accelerate the adoption and standardise the Velocys proprietary
Fischer Tropsch ("FT") technology with an integrated end to end solution,
including renewable power and carbon sequestration.

Velocys is enabling commercial scale synthetic fuel production in response to
the clean energy transition, with significant additional positive air quality
impacts.

www.velocys.com (http://www.velocys.com)

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