21 Sep 2012 09:33:00 9 Views 0 comments BIO FUEL PRODUCER JOINS FORCES WITH LUFTHANSA IN EUROPE
Sydney - Friday - September 21: (RWE Aust Business News) - ALGAE.TEC (AEB) is a biofuel company focused on commercialising technology that produces algae to manufacture sustainable fuels such as biodiesel and green jet fuel.
Algae.Tec attracted attention in the market this week after announcing a collaboration agreement with major European airline Lufthansa to build a biofuel production facility in Europe.
The company disclosed the construction of a large-scale algae plant facility to produce biofuels production.
The site will be in Europe adjacent to an industrial CO2 source.
Lufthansa will arrange full funding for the project.
Algae.Tec will receive licence fees and profits from the project, which will be managed by Algae.Tec.
As part of the agreement, Lufthansa will commit to a long-term offtake agreement of at least 50 per cent of the crude oil produced at an agreed price.
The agreement forms the base for a long-term co-operation between Algae.Tec and Lufthansa for the industrial production of crude algae suitable for conversion into aviation kerosene and conventional diesel fuels.
Algae oil produced by the project will fulfil the EU Renewable Energy Directive (EU-RED) and will be certified according to the ISCC standard.
The agreement builds on and supersedes the MOU signed between the two parties in January.
It is subject to final Board approval of both parties and the final sign off for the algae oil conversion into aviation kerosene.
A final feasibility report will be completed once the first site has been selected.
On the financial scene, Algae.Tec reported revenue from ordinary activities increased 95.7 per cent to $41,657.
The company incurred a loss from ordinary activities after tax of $6,437,533.
Total loss for the year was 6,516,268.
The year to June 30 was extremely rewarding for Algae.Tec as the company continued to develop its showcase demonstration facility at Nowra in NSW, and continues to form strong strategic relationships.
In December the company announced the signing of a collaboration contract with Holcim Lanka, one of the two largest cement manufacturers in the world.
This contract detailed that Algae.Tec will build a facility of up to five modules in Sri Lanka, which on successful completion would be extended to a full commercial facility.
Also in December the company completed an agreement to enable the raising of convertible notes to raise up to $9 million, and an MOU was signed with Lufthansa.
This detailed a working collaboration between the companies to develop algae facilities for the generation of fuel for the aviation industry.
During the year Algae.Tec signed a lease for a four-fold increase in area at its Atlanta development facility to enable the construction of fabrication and manufacturing facilities for its photo bioreactors.
This increase also gave space for increases in research and development facilities and for the building of a working demonstration bio reactor.
Meanwhile, the company was in discussions with various Chinese groups for a period of time, and this resulted in the signing of a binding MOU on January 18 with the Shandong Kerui Group.
This was significant as the agreement details the building of a first commercial plant in the Shandong province.
SHARE PRICE MOVEMENTS
Shares of Algae.Tec yesterday climbed 6c to 36c. Rolling high for the year is 63c and low 30c. The company has 51.9 million shares on issue with a market cap of $18.6 million.
On January 23 the company announced the raising of $5 million with a placement of shares through Patterson's Securities to enable it to fast track the commercial arrangements required for its strategic relationships.
With the increased interest in the company's technology in the SA, Algae-Tec announced the listing of the company's shares on the US OTC market in February.
Algae.Tec offers a sustainable and renewable advanced algae-to-biofuels technology.
The enclosed modular high-yield algae-to-biofuels bioreactor system uses waste C02 and sunlight to produce transport fuels such as biodiesel and jet fuel.
The fuel is designed to be a complete drop-in replacement solution that is cost competitive and contributes to energy security.
The company has incurred significant expenditure following strategic plans for building full-size bio reactor modules to be installed at Manildra in NSW.
The plant was officially opened on August 2 and is currently being independently tested and evaluated.
The Australian Government is providing research and development assistance through funding in the manner of income tax refunds for eligible expenditure.
In July the company received a payment of $199,727 under this scheme for expenditure incurred in the year to June 30.
BACKGROUND
Algae.Tec is an advanced biofuels company focused on commercialising technology that produces algae to manufacture sustainable fuels such as bio diesel and green jet fuel.
The company joined the ASX list on January 13, 2011.
Algae.Tec is also listed on the Frankfurt Stock Exchange and, in the US, its ADRs are traded on the OTCQX.
The company has developed a high-yield enclosed algae growth and harvesting process, the McConchie-Stroud system, which is a microalgae production technology via a modular photo-bioreactor system, that features improved algae harvesting and product refinement technologies.
Algae.Tec was founded in 2007 with offices in Atlanta, Georgia and Perth, Western Australia.
Its vision is to make a definitive impact on the energy and environmental challenges of the world by creating and implementing long-term, value-added, renewable and sustainable energy solutions for its customers.
The company has a highly experienced global team with over a combined 200 years of technical, professional and business expertise in key energy and environmental industries and core competencies in biofuel technologies, energy markets, project commercialisation and business management.
Algae.Tec has conducted hundreds of laboratory, bench-scale and pilot tests and product trials to-date.
It has assessed competitive algae technologies and has applied the development phase results to detailed engineering evaluations of commercial plant operations.
Collectively, these activities have led to the development of a unique proprietary technology and know-how for high-efficiency production of microalgae via a novel modular photo-reactor system and improved algae harvesting and product refinement technologies.
Algae.Tec's technology has demonstrated exceptional performance, providing step-change improvements in productivity, product yield, carbon dioxide sequestration, plant footprint requirements and substantial capital/cost savings versus agricultural crops and other competitive algae processes in the industry.
It has strategic partnerships with the Manildra Group, Lufthansa, Holcim Lanka Ltd and the Shandong Kerui Group Holding Ltd.
The company has been testing its product at a site provided by Manildra's ethanol plant at Nowra.
AEB Price at posting:
37.0¢ Sentiment: LT Buy Disclosure: Held
