5 July 2016
Quadrise Fuels International plc
("Quadrise", "QFI'' or the "Company")
End of Year Update
Quadrise Fuels International plc (AIM: QFI) is the emerging manufacturer and supplier of MSAR® emulsion fuels, a low-cost alternative to heavy fuel oil (one of the world's largest fuel markets, with volumes of over 450 million tonnes per annum) in the global shipping, refining, steam and power generation markets.
Further to the Company's announcement of its half year results, on 21 March 2016, the Company is pleased to provide an update on its key projects since that date.
Excellent progress has been made with the marine project during the period. As noted in the Company's announcement of 17 March 2016, the MSAR® Manufacturing Unit ("MMU") and associated systems were shipped to the Gibraltar San Roque Refinery owned by Compañía Española De Petróleos S.A.U. ("CEPSA"). The first batch of Marine MSAR® has been manufactured and was subsequently transferred from the refinery via a bunker fuel barge to the vessel designated by Maersk Line for the Operational Trial. The Operational Trial is expected to continue to provide 4,000 hours of engine operation on MSAR®, over a period of approximately 9 months (as the vessel route also encompasses an Emission Control Area for some periods, where lower sulphur bunker fuel is used). We do not anticipate providing regular updates as the trial progresses, but we look forward updating shareholders during our Annual General Meeting at year end and being able to confirm a successful conclusion of the trial in the Spring of 2017.
Alongside the project at CEPSA, we have continued to make good progress with other refiners to underpin the commercial roll-out of marine MSAR® fuels for the shipping industry, post the successful conclusion of the operational trial programme.
There has also been significant engagement with our clients in the Kingdom of Saudi Arabia on the production to combustion pilot programme during the period. Whilst there has been regular constructive dialogue with the clients, and progress has been made during the period, it is at a slower pace than the project stakeholders had originally envisaged. The launch of "Saudi Arabia's Vision 2030"* economic reform plan in April 2016 has indirectly had a short-term impact on the clients' decision making process for the programme. As a result, whilst the Company continues to work collaboratively to agree terms for the commencement of the project, it believes that the project timescales are now likely to be extended beyond the spring of 2017. The Company will provide a further update once its continuing discussions have reached a conclusion and the revised timetable is agreed.
With a focus during the period on ensuring the commencement of the marine Operational Trial programme by mid-year, and progressing the Saudi project, resource constraints have slightly delayed the progress on the technical evaluation work we are undertaking for a number of clients to confirm the suitability of specific refining residues for MSAR® production. This work is now expected to be completed during H2 2016.
Other opportunities in the power and refinery refuelling markets continue to be pursued, but these are longer-term projects and we were not anticipating any material developments in the short term.
Our collaborative research programme with the University of Surrey has made good progress and alongside our technical partnership with Akzo Nobel, further strengthens our proprietary technology and know-how relating to the production of MSAR® fuels.
* Vision 2030 is the Kingdom of Saudi Arabia's plan for its future development and includes enhancing its scale as a sovereign wealth investor and for further developing and diversifying its existing oil and mineral assets.
For further information, please refer to the Company's website at www.quadrisefuels.com or contact:
Quadrise Fuels International Plc |
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Mike Kirk, Executive Chairman |
+44 (0)20 7031 7321 |
Hemant Thanawala, Finance Director |
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Jason Miles, Chief Operating Officer |
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Nominated Adviser |
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Smith & Williamson Corporate Finance Limited |
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Dr Azhic Basirov |
+44 (0)20 7131 4000 |
Ben Jeynes |
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Broker |
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Peel Hunt LLP |
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Richard Crichton |
+44 (0)20 7418 8900 |
Ross Allister |
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Chris Burrows |
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Public & Investor Relations |
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Bell Pottinger |
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Daniel Thöle |
+44 (0)20 3772 2569 |
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