TIDMQFI
RNS Number : 1315D
Quadrise Fuels International PLC
17 February 2020
17 February 2020
Quadrise Fuels International plc
("Quadrise", "QFI", the "Company" and together with its
subsidiaries the "Group")
Notice of Interim Results and Business Update
Quadrise Fuels International plc (AIM: QFI) provides the
following update ahead of its interim results for the six months
ended 31 December 2019, which the Company intends to announce on 30
March 2020. The results announcement will be followed by an
investor conference call, further details will be provided in due
course.
Business Development Overview
The Company has continued to make progress across its portfolio
of business development opportunities with global partners. As
highlighted previously, the strategy of pursuing a diversified
range of opportunities provides Quadrise with access to a rich body
of experience through its various partners at negligible cash cost,
combined with opportunities to fully leverage its in-house business
development capabilities. The Company remains focused on
translating the opportunities being progressed during 2020 into
projects with clear commercial revenue potential.
Developments Post-AGM
Progress has been made in a number of areas that has enabled
Quadrise to increase the breadth and depth of its business
development programme, addressing the vast majority of the
potential MSAR(R) market opportunity. Developments by MSAR(R)
market segment are summarised below.
Industrial Applications
Morocco - Two site visits to Morocco took place, in December and
January respectively, concluding with the completion of a Hazard
and Operability (HAZOP) study of the pilot kiln and the associated
QFI equipment that will be used to undertake the trial. The pumping
and heating unit fabrication at our Quadrise Research Facility
("QRF") is now close to completion and the fuel for the trial is
due to be manufactured at QRF this month. The fuel and equipment
will then be transported to site in time for the trial to commence
in March 2020. Pending the positive outcome of this first phase,
which we are anticipating should be completed in early Q2 2020, the
intention is to progress to the second phase of paid feasibility
studies for larger trials that are a precursor to commercial
roll-out in the partners' facilities.
Power Applications, Refinery Refuelling, & Co-Development
Opportunities
-- Kingdom of Saudi Arabia (Al Khafrah Holdings and Aleph
Commodities) - In conjunction with the Al Khafrah Holding Group,
work continues to deliver high level engagement with major
stakeholders in KSA to agree, as soon as possible during 2020,
project details for a power plant trial. As mentioned during the
AGM, this work includes the opportunity to consider MSAR(R)
manufacture in KSA at a lower cost.
-- South America (Freepoint Commodities) - QFI and Freepoint
jointly met with senior management of a national oil company in
South America, where there is an MSAR(R) opportunity for refinery
refuelling, leading to domestic power generation and export
opportunities that would reduce distillate import requirements for
the client.
-- Mexico (Redliner & Freepoint Commodities) - Quadrise
continues to engage with key stakeholders and decision makers in
the energy sector to initiate MSAR(R) technology testing and
deployment in Mexico. MSAR(R) opportunities include refinery
refuelling, domestic power generation and fuel exports that reduce
distillate fuel imports. QFI has recently met with a major
independent power project developer, who is supportive of MSAR(R)
deployment, to provide economic and environmental advantages to new
build power projects.
-- European Refiner -The client is now comparing the economics
of MSAR(R) with another refinery solution (which requires complex
refinery testing during Q2 and Q3 2020) to enable IMO 2020
compliant fuel supply. It is anticipated that the client will make
a decision at the end of Q3 2020. If MSAR(R) is selected, the
Company would expect to finalise the site trial agreement,
including schedule, for refinery refuelling during Q4 2020.
-- Nouryon - We have held positive discussions regarding
business collaboration opportunities between Quadrise, Nouryon and
related companies within the Carlyle Group.
-- Kuwait (Aleph Commodities and Hawazin) - An MSAR(R) refinery
refuelling opportunity is being explored for the new refinery and
information is being exchanged with the client team to review this
in more detail alongside with Hawazin. If the project economics are
positive, Quadrise will undertake a feasibility study and develop
an implementation plan to present to the client team in Kuwait.
Marine Applications
-- Marine - The implementation of IMO 2020 compliance remains
the main focus for shipping companies and operators during Q1 2020.
The Company has had positive meetings with senior management of two
major shipping companies, each with major fleets and leading
positions in scrubber implementation in their segments of the
shipping industry. Further meetings with these companies are being
planned during H1 2020 to investigate potential MSAR(R) Letter Of
No Objection ("LONO") testing and commercial deployment, on
success, to reduce fuel costs further whilst improving
environmental performance. Quadrise is also investigating the
merits of establishing, or linking with, a physical bunker fuel
supplier, to provide a supply network for high sulphur fuels in
parallel with MSAR(R) for the LONO testing opportunities. Further
updates in this regard will be provided, as appropriate, in due
course.
Upstream Applications
-- Merlin - Joint meetings have been held with an upstream
developer with MSAR(R) potential in Africa, and parallel
opportunities in South America are being jointly screened.
-- Other - Quadrise is also in preliminary discussions directly
with upstream developers in Africa and North America, both of whom
have concessions for extraction of heavy sweet crude oil / bitumen
that potentially would benefit from the implementation of MSAR(R)
technology.
Other
There are no material updates to report during the period to
developments with the European Oil Major, Maersk, Bitumina, JGC or
API Poly GCL.
Funding
Our existing cash resources continue to enable the Group to
pursue our business development activities throughout calendar year
2020, with a further GBP2 million of funding potentially available
to the Company from August 2020 pursuant to the previously
announced convertible security instrument. If the Company is able
to draw down this additional funding in August 2020, subject to
conditions precedent being met, the additional funds would be
expected to meet project expenditure that is currently anticipated.
However, the Company is cognisant that in order to have a high
degree of confidence that this additional funding is available, we
will need to be able to demonstrate substantive progress on our
projects and for this progress to be reflected in a steadily
appreciating share price.
The QFI Board believes that the business development pipeline
above provides the platform needed to deliver our strategy of
translating opportunities during 2020 into projects with commercial
revenue potential, and we look forward to providing further updates
on progress.
For additional information, please contact:
Quadrise Fuels International plc +44 (0)20 7031 7321
Mike Kirk, Chairman
Jason Miles, Chief Executive Officer
Cenkos Securities plc +44 (0)20 7397 8900
Nominated Adviser
Dr Azhic Basirov
Ben Jeynes
Katy Birkin
Peel Hunt LLP +44 (0)20 7418 8900
Joint Broker
Richard Crichton
David McKeown
Shore Capital Stockbrokers Limited +44 (0)20 7408 4090
Joint Broker
Toby Gibbs
Fiona Conroy
FTI Consulting +44 (0)20 3727 1000
Public and Investor Relations
Ben Brewerton
Ntobeko Chidavaenzi
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END
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