HydroDec Group plc Transformer oil plant co-location and tolling (9890S)
November 14 2013 - 2:00AM
UK Regulatory
TIDMHYR
RNS Number : 9890S
HydroDec Group plc
14 November 2013
14 November 2013
Hydrodec Group plc
("Hydrodec", the "Company" or the "Group")
Transformer oil plant co-location and tolling agreement in
Australia
Hydrodec Group plc (AIM: HYR), the cleantech industrial oil
re-refining group, has today entered into an agreement to co-locate
its Australian transformer oil re-refining operation at the
Southern Oil Refining Pty Limited (SOR) lubricant oil re-refinery
in Wagga Wagga, New South Wales (NSW). This will create a single
re-refining site of scale in NSW, improving Hydrodec's cost and
operational efficiency, and substantially enhancing operational
resilience. SOR will operate the combined facility under a tolling
agreement.
SOR and its partner JJ Richards are leading collectors and
re-refiners of general used lubricant oil in Australia and are
currently constructing their second re-refinery complex at
Gladstone, Queensland. Today's agreement proposes co-locating
Hydrodec's industry- leading used transformer oil re-refining
technology with Australia's leading general used oil re-refiner at
SOR's Bomen site in Wagga Wagga, NSW. Hydrodec will retain all
rights and ownership of the Hydrodec brand, business and technology
in Australia and will continue to manage all commercial aspects of
the business including used oil procurement as well as sales and
marketing of SUPERFINE(TM) transformer oil and naphthenic base
oil.
SOR has also agreed to support development of the Hydrodec
technology for used industrial and engine oils and would be a
potential partner for the new technology in Australia not only at
Wagga Wagga, but also at its new development in Gladstone,
Queensland subject to technical and commercial agreement.
Costs of the transition of the plant will be developed through a
detailed planning process; benefits due to scale, operational
synergies and business resilience are expected to offer an
attractive return. Co-location is conditional on permitting for the
expanded operation at Bomen which has already been applied for.
Ian Smale, Chief Executive Officer of Hydrodec, commented: 'This
agreement is another example of our focus on delivering our
strategy through partnerships that integrate the value chain and
create opportunities both to lower business risk and develop our
technology. Southern is an exceptional operating company and will
be a good steward for our operation in the region; its link to JJ
Richards offers other logistical opportunities for the collection
and distribution of transformer oil and, as with our recently
announced partnership with Essar Oil in the UK, we are partnering
with successful companies that can make a real contribution to the
growth and capability of our business.'
Tim Rose, Southern Oil's CEO, commented: 'We're excited about
the prospect of our two companies working together. We have
complementary strengths and specialist expertise in our businesses
and combined we will be able to leverage those strengths to pursue
new opportunities in Australia and internationally.'
For further information please contact:
Hydrodec Group plc 020 7907 9220
Ian Smale, Chief Executive
Chris Ellis, Chief Financial Officer
Peel Hunt LLP
(Nominated adviser and broker) 020 7418 8900
Richard Kauffer
Daniel Harris
Vigo Communications (PR adviser
to Hydrodec) 020 7016 9570
Patrick d'Ancona
Chris McMahon
Notes to Editors:
Hydrodec
Hydrodec's technology is a proven, highly efficient, oil
re-refining and chemical process initially targeted at the
multi-billion US$ market for transformer oil used by the world's
electricity industry. Spent oil is currently processed at two
commercial plants with distinct competitive advantage delivered
through very high recoveries (near 100%), producing 'as new' high
quality oils at competitive cost and without environmentally
harmful emissions. The process also completely eliminates PCBs, a
toxic additive banned under international regulations. Hydrodec's
plants are located at Canton, Ohio, US and Young, New South Wales,
Australia. Hydrodec recently acquired the business and assets of
OSS Group, the UK's largest collector, consolidator and processor
of used lubricant oil and seller of processed fuel oil, with a
national network of oil storage and transfer stations, currently
serviced by a fleet of more than 90 trucks which collect used oil
and other garage workshop waste from over 30,000 customers. Used
oil is converted into processed fuel oil at OSS's plant at
Stourport and principally sold on to the UK quarry and power
industry.
Hydrodec's shares are listed on the AIM Market of the London
Stock Exchange. For further information, please visit
www.hydrodec.com
Southern Oil Pty Limited
The Australian owned Southern Oil Refining (SOR) is based in
Wagga Wagga, and its re-refinery is situated at Bomen Business Park
(5kms north of the Wagga CBD).
The re-refinery produces a range of quality base oil products
all manufactured from previously used lubricant oils, rather than
from crude oil as at the traditional oil refineries. The
re-refinery also produces a range of fuel oils as by-products.
Manufacturing quality base oils by re-refining used lubricant
oil has significant environmental benefits over refining from crude
oils to the same specifications. Tests have demonstrated that SOR
oils are at least as good as and in some specific ways better than
base oils made from crude oil.
The SOR process prevents the release into the environment (on
land and in water courses) of waste oil and ensures that
contaminants are properly removed and safely disposed.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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