Catch Up With Bahay 21 April 2023
Questions from Hotcopper
@Hammerhead
Q. Shell intentions, 12 month extension, QGC or industry solution.
A. As previously explained. 12 month extension is a vote of confidence in what we have done for them to date and the results of the FS.Opportunity to continue discussions on further progressing getting to construction and revenue for PWN.
QGC are absolutely committed to leading the pack and want this solution.They won’t wait for the Master Plan, they are happy to trailblaze.
@Brickal
Q. CSG beyond Qld, what it is?Do you think the competition will come out?Is there any intention of purchasing PWN outright?
A. Beyond there is Coal Bed Methane in the US and they have done some work for companies there and there is a large opportunity in the Middle East also. The competition if there is any is so far behind that they won’t be able to stump a tested viable solution to compete with PWN ( that’s my take).Roadshow was about strategic partners to build the infrastructure, own and operate it, not taking a stake in PWN.
@Kere
Q. Do we have a Media on Call Section on the website for media queries?
A.We have an Investor Hub and soon it will be interactive where you can even make comments on quarterly reports and released announcements an ask questions.
@NJG93
Q. Will extension of Shell Agreement stop FS Details being announced to the market?
A. Yes, this is QGC’s report and it’s confidential.But what it does do is show that the contents and results were overwhelmingly positive enough for Shell to extend the Agreement.
@Vanilla Rocket
Q. What share of savings.
A. Previously disclosed 10-20% on base case, potentially more if we have IP/Equity stake in plant.
@ricksanchez
Q. ZLD what does “likely to be achieved mean?What is a certain application?Do we expect some brines to be more difficult to process?
A. Referenced back to and showed a RoadShow slide that is the same as the AGM slide deck on Brine reduction where industry is using reverse osmosis to reduce water volume by 97%, Shell/QGC then reduce it again.PWN then take that and reduce water volumes by a further 98.3% which is the ZLD.
@Ricmond88
Q. Shell preferenced pathway?
A.Shell are pathway agnostic. All options are on the table.FS is now with Shell Corporate for review.
Mr M’s Questions
Q. Record quarterly Sales, did this include one offs or one large invoice?Cash Flow positive by when?
A. No one offs, this is our growing revenue.New BDM in Perth will drive this even higher. Could have been cash flow positive this month but purchased inventory to support initiatives and ongoing R&D and stock replenishment.
PPT Section of the Quarterly
Q. FS is in, what’s next?
A. The obvious process if you visit Shell’s webpage is that we progress into FEED ( Front End Engineering Design)Google what that is, why companies do it.
Def - FEED (Front End Engineering Design) means Basic Engineering which is conducted after completion of Conceptual Design or Feasibility Study. At this stage, before start of EPC (Engineering, Procurement and Construction), various studies take place to figure out technical issues and estimate rough investment cost.
QLD CSG Opportunity Section of Quarterly
Important fact is that QGC/Shell have been part of the FS all along and met with PWN fortnightly during its progress.They are invested.Based on industry figures, 194,000 tonnes of salt produced annually ( plus what’s already been produce to date that is sitting in brine ponds) x 30 years, 6m tonnes, equals $9.2B opportunity.
Q.What does this evaluation give you confidence in?
A.Evaluation supports previous studies and metrics about the size of the opportunity, AGM Slide on Value Creation Opportunity Slide, $1.5k per tonne of salt x numbers presented above. Huge opportunity.
Further Tech Breakthroughs part of Quarterly
Q. ZLD, for certain applications. What’s the significance of this?
A.Major significance.As we develop Master Plan for the industry, not only have we solved the issues for QGC/Shell but the studies, the piloting, the bench tests all provide solutions to the industry problem not just QGC/Shell.
As mentioned above in @ricksnachez question and answer, Shell/QGC process the brines further than anyone else, the rest of the industry doesn’t have that capability or is currently not applying but PWN can provide the whole industry with a solution, QGC highly concentrated brine and the rest of the industry’s not so processed brines.
The Roadshow was about obtaining investment partners for the industry wide solution, not the Shell/QGC project, Shell/QGC can afford to go their own way and fund it.
Hub and Spoke Industry Wide Solution
I asked about what the Hub and Spoke was.More to come on this suffice to say that the RoadShow gives PWN backers for the whole Industry wide solution.PWN’s modelling is showing some great numbers on industry wide opportunities.Used as material for the RoadShow I would suspect, but didn’t see it.
This whole process has provided a solution for all industry playeres, hence the Master Plan.
Govt has 5 priorities, I didn’t write them all down, circular economy, Products from waste and guess who has the solution.
FS QGC
Working on the Master Plan which involves making sure that all stakeholders are catered for all stakeholders, Government Departments, investors, community, industry etc.
Stakeholder Engagement
What will this lead to?Potential Partners and Strategic Investors.Purpose?Given only viable solution for Priority 1, why do you think it willtrigger regulatory requirements?
Visiting sites as a guest of the government, visiting other industry player sites.Government taking this brine issue very seriously.Any new approvals for gas projects need to make sure they have exhausted all available options for Priority 1 ( Sale of salt products from waste ).As of today, that means any new gas projects need to have explored PWN’s iBC process.
Bahay has been speaking to and meeting with the key Government stakeholders and Study producers.All been extraordinarily positive.Hence the Govt invite to site visits.
These visits won’t upset Shell because they are actually being proactive and the rest of the industry isn’t.In Shell’s annual report last year, they spoke about exploring new tech.What will the rest of the industry say this year?No excuses any more.
Master Plan
Spoke about this, in the notes above.New info, includes offtakes, treatment plant operators, builders of infrastructure so Worley will be in the mix.Need to cover the Project build from start to finish including funding and operations.
Commercialisation Activities
Several commercially focused milestones are anticipated to be achieved.Bahay left this one alone.
Strategic Positioning
Key message is that the Team are working on the Master Plan so that it can be presented to stakeholders.Didn’t say when, I didn’t ask.Was running out of time.
R&D Rebate – How much?
More than last year, should be in this quarter, will help and make it a cash flow positive qtr by my take.
RoadShow Purpose!
Already discussed above.Investors and Partners to delivery industry wide solution through the Master Plan.
Investor Relations and Research Report
Q. What will they base the valuation off? $300m per annum x 30 years.
All publicly available information including our AGM Presentations and announcements.Expected in the next few weeks.Will show for the first time PWN’s potential earnings and valuation.
Master Plan
We discussed this virtually first but I had to put my notes at the end of the list of questions so here it is again.
Reverse osmosis is used to process brine water which I had said Shell takes a little further in the refinement process.The remainder sits in the ponds.The other industry players can’t process it further like Shell/QGC.The cost of going to next step by the other players is cost prohibitive based on current knowledge.
Interesting comment coming from the Industry.
“ It would be too energy intensive and costly to treatbrines versus putting salt in the ground and buring it for 150 years”.
Ah, Derrr, you have to process it to get to salt waste product, meaning you have to take the next stage as per Shell/QGC anyway but you have a lot more to dispose of versus iBC/PWN which can concentrate it even further and then produce saleable products.
The rest of the Master Plan process will come out when PWN releases it to market but I think I can guess what the process is given the above.We are the final process for QGC/Shell, we have one extra step for the others basically.Hub and Spoke remember.
Remember Shell and master Plan are two different things and it’s not one or the other.Shell are moving forward and will trailblaze for the industry.
Key Messages for me
·Backers from investors and partners to deliver an industry solution or the Shell/QGC solution if Shell/QGC don’t want to own the plant
·Research report will for the first time show what PWN could be worth in the not to distant future.
·Qld govt sponsored site visits and discussions about the Master Plan and recent iBC findings.
·Master Plan delivered to Qld Govt, CSG industry, stakeholders
·Shell/QGC’s next move into FEED.
I really like how this story is building. Hope the above helps.
All of the above is my interpretation of my discussion with Bahay. The above is not advice, simply my thoughts based on a conversation.
Mr M.
(20min delay)