TIDMAFC
RNS Number : 3800U
AFC Energy Plc
12 July 2018
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014. Upon the
publication of this announcement via a Regulatory Information
Service ("RIS"), this inside information is now considered to be in
the public domain.
12 July 2018
AFC Energy PLC
("AFC Energy" or the "Company")
AFC Energy Receives First Commercial Hydrogen Power Generation
Order in Australia from Southern Oil Refining
AFC Energy (AIM: AFC), the industrial fuel cell power company,
is pleased to confirm receipt of its first commercial order in
Australia for its proprietary hydrogen power generation unit from
refiner, Southern Oil Refining Pty Ltd ("Southern Oil").
Highlights
-- Southern Oil, through its wholly owned subsidiary Northern
Oil Pty Ltd ("Northern Oil"), has placed an order for the first AFC
Energy hydrogen power generation unit in Australia;
-- The hydrogen power generation unit, expected to be sized
between 200kW and 400kW, subject to engineering, will be located at
Northern Oil's world leading Advanced Biofuels Refinery near
Gladstone, Australia;
-- Non-refundable deposit to be paid to AFC Energy within five business days of the offer;
-- Brief period of engineering now commencing to finalise final
project sizing, scope and commensurate contract terms;
-- AFC Energy plans to sell the balance of plant for its
hydrogen generation unit to Southern Oil and lease the system's
stack and electrodes for an undisclosed sum reflective of the
project's capital cost (incl. fuel cells);
-- Northern Oil to utilise surplus hydrogen from its Gladstone
refinery in the process and consume all power produced within its
facilities at a cost better than its existing grid power
tariff;
-- Project to be delivered in the first half of 2019.
Northern Oil's Advanced Biofuel Refinery near Gladstone, is
currently operating to convert several waste streams into renewable
crude, before refining it into 100% certified renewable fuel. The
Advanced Biofuels Refinery, supported by the Australian Government,
Queensland Government and ARENA (Australian Renewable Energy
Agency), is a world first and within its operation, will require
large volumes of industrially stable, renewable biohydrogen to
support the refining process.
Northern Oil, is developing a new hydrogen generation technology
to complement its refining process. The technology utilises Steam
Over Iron Reduction and Chemical Looping processes to deliver
cheaper and more efficient hydrogen than conventional Steam Methane
Reformation ("SMR"). Northern Oil is building a large industrial
scale pilot plant where surplus hydrogen generated from the system
is to be made available for consumption within a fuel cell.
In October 2017, Southern Oil and AFC Energy entered into a
non-binding Memorandum of Understanding outlining the intention to
collaborate in the assessment of opportunities for the integration
of an AFC Energy fuel cell system into Southern Oil's refining
process.
Through this collaboration, Southern Oil has today placed an
order with AFC Energy for a hydrogen power generation unit
utilising AFC Energy's proprietary fuel cell system that will
enable the supply of clean power back into the refining
process.
AFC Energy will, subject to final agreement on all commercial
terms, sell and lease components of its generation system for an
undisclosed sum, reflecting the capital cost of the balance of
plant and lease fees towards the cost of the fuel cell electrodes.
The power generated, expected to be between 200kW and 400kW in
capacity (dependent upon the final volume of hydrogen made
available from the refinery), is expected to be at a lower cost
than with that of existing regional grid tariffs in Queensland,
Australia.
AFC Energy, following receipt of a non-refundable deposit within
5 business days of the offer, shall commence a brief engineering
study to confirm the system sizing and logistics for integration of
the hydrogen power generation unit fuel cell system into the
refinery. This exercise will allow finalisation of the AFC Energy
system design capacity and its final system costings, following
which a binding sales and lease agreement is expected to be entered
into.
The AFC Energy fuel cell system is expected to be delivered to
Northern Oil's Gladstone facility in the first half of 2019.
Tim Rose, Southern Oil's Chief Executive Officer, said:
"Southern Oil has at its heart a desire to develop new and
innovative ways of generating clean fuels for Australia's future.
The placement of today's order with AFC Energy for one of its
hydrogen power generation units is the next phase of our commitment
to a green and clean future through the generation of clean power
from our surplus hydrogen streams. The potential to drive our
renewable refinery increasingly off grid and towards green power
consumption is a key driver for today's order and we look forwards
to working closely with AFC Energy in delivering a successful
outcome for this project. In developing the Gladstone Advanced
Biofuels Pilot Plant over the last three years, Southern Oil, has
benchmarked cutting edge renewable technologies from around the
world. In my mind, AFC Energy's Alkaline Fuel Cell has great
potential."
Adam Bond, AFC Energy's Chief Executive Officer, said: "With a
global estimated 100,000MWe of hydrogen vented to atmosphere from
industry each year, I am particularly delighted to confirm AFC
Energy's strategic collaboration with Southern Oil, a highly
respected and entrepreneurial Australian clean fuels refiner with a
strong track record of delivery. The order received for the
Company's fuel cell system reflects the first stages of a growing
pipeline of commercial fuel cell projects in country and validates
the opportunities we believe to be emerging in the Australian
hydrogen market. Today's order from Southern Oil is a strong
validation of the progression AFC Energy has made over the past few
years and provides a strong cornerstone in the Company's
commercialisation activities that are well underway."
For further information, please contact:
AFC Energy plc
Adam Bond (Chief Executive Officer) +44 (0) 20 3697 1209
Cantor Fitzgerald Europe - Nominated Adviser and Joint Broker
David Foreman
Richard Salmond +44 (0) 20 7894 7000
M C Peat & Co LLP - Joint Broker
Charlie Peat +44 (0) 20 7104 2334
Lionsgate Communications - Public Relations
Jonathan Charles +44 (0) 20 3697 1209
About AFC Energy
AFC Energy plc has developed and successfully demonstrated an
alkaline fuel cell system, which converts hydrogen into "clean"
electricity. AFC Energy's key project POWER-UP demonstrated the
world's largest operational alkaline fuel cell system at Air
Products' industrial gas plant in Stade, Germany. The Company is
now building upon an already established pipeline of commercial
opportunities and driving the findings from the development phase
of the technology into a technically optimised and commercially
relevant fuel cell system. For further information, please visit
our website: www.afcenergy.com
About Southern Oil
Southern Oil is a privately owned Australian company operating
two waste oil refinery facilities in Wagga Wagga (NSW) and
Gladstone (QLD). Each day these refineries take in around 420,000
litres of waste lube oil that would otherwise be burnt or
dumped.
The development of world leading processes in waste oil refining
has led to investments into, and the opening of, Australia's first
Advanced Biofuels Laboratory and Biofuels Pilot Plant in Gladstone,
Queensland.
Southern Oil are testing renewable technologies from around the
world to produce renewable crude, bio-hydrogen and 100 per cent
renewable drop in fuels. For further information, please visit
Southern Oil's website: www.sor.com.au
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END
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