PyroGenesis Canada Inc. (http://pyrogenesis.com) (TSX: PYR)
(NASDAQ: PYR) (FRA: 8PY), a high-tech company (hereinafter referred
to as the “Company” or “PyroGenesis”), that designs, develops,
manufactures and commercializes advanced plasma processes and
sustainable solutions which are geared to reduce greenhouse gases
(GHG), confirms today that, further to its press release dated
September 14, 2021, it has received a milestone payment from Client
B of approximately $1.3 million. Separately, the Company confirms
that the previously announced1,2 trials of its patented plasma
torch system for use in iron ore pelletization furnaces, with both
Client A and Client B, (the “Clients” or “Client”) are ongoing with
no change in strategy by either PyroGenesis and/or the Clients. The
names of the Clients have been kept confidential for competitive
reasons.
“These trials, representing years of research
and development, computer modelling, business case development, and
factory acceptance testing, have required multi-million-dollar
infrastructure expenditures by the Clients,” said Mr. P. Peter
Pascali, CEO and Chair of PyroGenesis. “These projects are all
continuing as expected notwithstanding the impact covid has had on
our Client’s ability to source the supplies required to ready their
site for the introduction of our torches. Excluding covid-related
supply chain delays on the Client’s part, other engineering and
project-partnership aspects not impacted by covid are continuing by
both parties.”
“Our goal has always been to help companies,
across multiple industries, replace all manner of fossil fuel
burners with PyroGenesis’ plasma torch, not just those using fuel
oil or bunker fuel, but also natural gas and other fuel types,”
added Mr. Pascali. “We are happy to see that over the recent past,
several major industry players, particularly in the iron ore
pelletization industry, have initiated their decarbonization
efforts by first switching from heavy fuel oil to natural gas which
was essentially a switch to a cheaper fuel but with limited impact
on CO2 emissions (with approximately 70% remaining). As such, this
switch to a cheaper fuel has never been a threat to our
business. In fact, of note, is that one of PyroGenesis’ iron
ore clients has already targeted natural gas burners to be replaced
by PyroGenesis’ plasma torches. Natural gas use by iron ore
pelletizers (and by companies in other industries) represents the
same opportunity for PyroGenesis’ plasma torches as it does with
companies using heavier fuel oil or bunker fuel. It should also be
noted that industry announcements related to switching to a
different type of fossil fuel, are common, and may, in fact, relate
to decisions that were planned before PyroGenesis’ plasma torch
became an option. Naturally, until the trials with our torches are
undertaken, one would not expect our Clients to materially change
the plans they had before PyroGenesis became known. We can state
unequivocally that neither of our existing iron ore Clients has
expressed any desire to change their strategy/plan with PyroGenesis
based on any fossil fuel currently, or slated to be, put into use.
In fact, I would suggest that given recent market conditions, our
Clients seem more interested in the potential benefits of our
offering.”
The Company provides a short update with respect
to its work with previously announced Clients, as follows:
Client A
Client A is a multi-billion-dollar international
producer of iron ore. Further to its press release dated July 5,
2022, the Company has already delivered (and the Client has
purchased) a 1-MW plasma torch system and numerous peripheral
components for use in the Client’s iron ore pelletization
furnaces.
At the Client’s discretion, based on their
engineering and facility schedule, the plasma torch system will be
trialed in an active pelletization furnace.
On July 5th, the Company announced that the Site
Acceptance Test (“SAT”), which was initially scheduled to be
completed for the end of July 2022, would be postponed to the end
of October, due to nothing other than supply chain delays in
implementing significant modifications to their site which they are
making, at their expense. The Client has reassured PyroGenesis that
activities are advancing as required, and this process extension
represents changes to scheduling and reallocation of materials and
personnel, with all objectives remaining the same. As of this
writing, the Client continues to experience bottlenecks with parts
of their infrastructure readiness and is not yet ready to start the
SAT, nor have they given a firm start date. It must be repeated
that the Client has made a major engineering and financial
investment in this plasma torch trial, and according to the Client,
its eventual operation is not in doubt. Once the SAT is performed,
the Client most probably will run the system for a trial period,
the duration of which is unknown at this time.
Client B
Client B is also a multi-billion-dollar
international producer of iron ore. Further to the press release
dated September 14, 2021, in which it was announced that the Client
will purchase, and PyroGenesis will supply, four (4) high power
plasma torches together with ancillary equipment for trial use in
iron ore pelletization furnaces, the achievement of recent
production milestones has resulted in a payment to PyroGenesis of
approximately $1.3 million. These plasma torch systems, when
delivered at the discretion of the Client’s engineering and
infrastructure timeline, will be used to replace fossil
fuel-burners in an iron ore pellet baking furnace.
Bunker Fuel to Natural Gas
Separately, PyroGenesis is both aware of, and
encourages, the fact that many iron ore producers continue to take
numerous steps towards a decarbonized future, including testing and
trialing a variety of alternatives to replace the carbon-producing
aspects of their business. One such example is the replacement of
fuel oil (also known as “bunker fuel” or “number 6 fuel oil”) with
natural gas.
To that end, it is important to note that
natural gas – a fossil fuel – is also a heavy emitter of CO2, and
while offering an approximately 28% to 30%3 reduction in CO2 from
the existing fuel oil approach, is generally considered a short
term solution for iron ore factories towards their eventual
decarbonization goal; additionally, the use of natural gas is often
related to wider availability, lower cost, and different
competitive market dynamics for the gas compared to fuel oil.
Importantly, the Company notes its long awareness of natural gas
usage in pelletization plants; in fact, the location of the planned
plasma torch trials for Client A are at a location where furnaces
already are utilizing natural gas.
“This latest production milestone, and the
concurrent $1.3 million dollar payment, is another step in the long
journey that we have undertaken together with our major iron ore
clients – a journey towards the decarbonization goals of these
companies and of an entire industry,” said Mr. Pascali. “The size
and scale of the transition at which these iron ore pelletizers are
aiming, takes not only time, but extensive analysis, significant
resources, uncompromising engineering discipline and expertise, and
technology vendors willing to go the distance as true partners. As
numerous other activities, tests, trials, and modifications take
place concurrently, and as companies across heavy industry
implement various interim measures such as alternative fuels, the
key players within iron ore and steelmaking continue to publicly
assert that the future is carbon-free and electric. With our
patented 100% electric, carbon-free, plasma torches offering a
truly unique solution for fossil-fuel furnace burner replacement,
we agree wholeheartedly. There is no doubt that both Clients A and
B are moving as quickly as possible, given their individual
circumstances, with the previously announced trials. We are, along
with many in the industry, eagerly looking forward to the upcoming
technology trials, with the start-date, timing, and duration being
entirely up the clients’ discretion.”
“We are extremely happy, and proud, with the
progress made to date although, as with everything we do, we wish
it would move a tad faster. Notwithstanding that, the fact remains
that PyroGenesis has gone, in a few short years, from being an
unknown in the iron ore pelletization industry to being considered
a technology of choice in solving a serious issue plaguing multiple
iron ore pelletizers,” added Mr. Pascali. “As one might expect we
are also in discussions with other companies within the iron ore
industry, as well as other industries, about replacing natural gas
burners with plasma torches. I think it is generally recognized by
those in the industry that natural gas burners are not the
long-term solution for any company that is serious about the
reduction of CO2 and as such is not an impediment to our long-term
goal of replacing all fossil fuel burners with plasma torches. This
position is confirmed by our Clients who would not be moving
forward with us and investing the type of money they are in this
project. That is not to say that we are guaranteed to be
successful, just that we are definitely on the right track and
moving in the right direction. In fact, the big picture of our
success to date is the fact that this continued interest
underscores the far-reaching opportunity for PyroGenesis’ plasma
torches, namely aiding multiple industries in their fuel-switching
goals, away from CO2-producing sources and on to a clean electric
future."
Pelletization is the process in which iron ore
is concentrated before shipment, thus significantly reducing the
cost of transportation, and providing a required feedstock for
blast furnaces. In conventional technologies, the process heat is
provided by fuel oil or natural gas burners (both environmentally
damaging). The combustion of fossil fuels in the burners results in
the production of GHG, mainly CO2. Plasma torches, by contrast,
utilize renewable electricity and offer an environmentally
attractive alternative to fossil fuel burners. As previously
disclosed, PyroGenesis has the process patent to replace fossil
fuel burners with PyroGenesis’ clean plasma torches in the iron ore
pelletization industry, thereby reducing GHG emissions.
About PyroGenesis Canada
Inc.
PyroGenesis Canada Inc., a high-tech company, is
a leader in the design, development, manufacture and
commercialization of advanced plasma processes and sustainable
solutions which reduce greenhouse gases (GHG) and are economically
attractive alternatives to conventional “dirty” processes.
PyroGenesis has created proprietary, patented and advanced plasma
technologies that are being vetted and adopted by multiple
multibillion dollar industry leaders in four massive markets: iron
ore pelletization, aluminum, waste management, and additive
manufacturing. With a team of experienced engineers, scientists and
technicians working out of its Montreal office, and its 3,800 m2
and 2,940 m2 manufacturing facilities, PyroGenesis maintains its
competitive advantage by remaining at the forefront of technology
development and commercialization. The operations are ISO
9001:2015 and AS9100D certified, having been ISO certified since
1997. For more information, please visit: www.pyrogenesis.com.
This press release contains certain
forward-looking statements, including, without limitation,
statements containing the words "may", "plan", "will", "estimate",
"continue", "anticipate", "intend", "expect", "in the process" and
other similar expressions which constitute "forward- looking
information" within the meaning of applicable securities laws.
Forward-looking statements reflect the Company's current
expectation and assumptions and are subject to a number of risks
and uncertainties that could cause actual results to differ
materially from those anticipated. These forward-looking statements
involve risks and uncertainties including, but not limited to, our
expectations regarding the acceptance of our products by the
market, our strategy to develop new products and enhance the
capabilities of existing products, our strategy with respect to
research and development, the impact of competitive products and
pricing, new product development, and uncertainties related to the
regulatory approval process. Such statements reflect the current
views of the Company’s with respect to future events and are
subject to certain risks and uncertainties and other risks detailed
from time-to-time in the Company's ongoing filings with the
securities regulatory authorities, which filings can be found at
www.sedar.com, or at www.sec.gov. Actual results, events, and
performance may differ materially. Readers are cautioned not to
place undue reliance on these forward-looking statements. The
Company undertakes no obligation to publicly update or revise any
forward- looking statements either as a result of new information,
future events or otherwise, except as required by applicable
securities laws. Neither the Toronto Stock Exchange, its Regulation
Services Provider (as that term is defined in the policies of the
Toronto Stock Exchange) nor the NASDAQ Stock Market, LLC accepts
responsibility for the adequacy or accuracy of this press
release.
For further information please contact: Rodayna
Kafal, Vice President, IR/Comms. and Strategic BDPhone: (514)
937-0002, E-mail: ir@pyrogenesis.com RELATED LINK:
http://www.pyrogenesis.com/
1 PyroGenesis Announces $6 million Torch Order With Another
Major Iron Ore
Pelletizerhttps://ir.pyrogenesis.com/news-releases/news-release-details/pyrogenesis-announces-6-million-torch-order-another-major-iron
2 PyroGenesis Confirms Delivery of Plasma Torch To One of the
World’s Largest Producers of Iron Ore For Use In Induration
Furnacehttps://ir.pyrogenesis.com/news-releases/news-release-details/pyrogenesis-confirms-delivery-plasma-torch-one-worlds-largest
3 The Bottom of the Barrel: The Fuel Effect: What is Being
Burned Matters, by M.J. Bradley & Associates LLC for the
EDFhttps://www.edf.org/sites/default/files/10071_EDF_BottomBarrel_Ch3.pdf
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