LONDON (Alliance News) - Hydrodec Group PLC on Wednesday said it has made a "successful return" to the US transformer oil market, with strong sales of its SUPERFINE oil to customers in the US and Mexico.
Hydrodec said its re-refinery at Canton in Ohio has been rebuild and expanded, enabling it to produce transformer oil since September 24. The plant was damaged by an explosion and fire in December 2013. Then in July, it had to be shut down after equipment integrity issues were identified, though this was resolved the same month.
Hydrotec said it expects to increase production from the first four trains to operating design capacity of about 70,000 litres per day.
According to the company, the plant is on track to deliver 10 million litres of processed oil this year, as was previously advised. It is expected to become cash generative from an operating perspective by the end of 2015.
In addition, Hydrodec has agreed a GBP1.4 million short term working capital facility agreement with Non-Executive Director Andrew Black.
The company will pay 7% in interest on money drawn down under the facility, which can be repaid in full at any time.
The facility is secured over the company's licence of and rights to develop the CEP lubricant oil re-refining technology in the UK.
"We are confident that the rebuilt and expanded plant has a unique market proposition and will be well placed in 2016 to leverage the production of the highest quality transformer oil produced in the US, meeting all US and international standards. The additional working capital facility reinforces the company's short term working capital position and ensures that Hydrodec's North American business remains adequately funded during the important ramp up of production from Canton," Chief Executive Ian Smale said in a statement.
Hydrodec shares were up 2.4% at 6.78 pence on Wednesday late morning.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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