LONDON (Alliance News) - Quadrise Fuels International PLC shares rose on Wednesday after it said it will begin trialling its flagship MSAR fuel technology at the beginning of 2016 as it progresses several opportunities toward commercial production.
Quadrise shares were up 10% to 12.94 pence per share on Wednesday morning.
The technology provider to the oil and gas industry said it has signed an agreement with shipping firm Maersk and refiner CEPSA to supply, install and commission a manufacturing unit to produce MSAR emulsion fuel at the CEPSA San Rogue refinery near Gilbraltar.
The company's MSAR emulsion fuel oil product uses water to turn heavy oil into a low viscosity fuel which has enhanced combustion features. MSAR fuel from the manufacturing unit will be used in a seaborne operational trial which will begin in the first quarter of 2016, it said, with Danish shipping giant AP Moller-Maersk AS being the main tester.
The trial period is expected to last between nine to 11 months.
"MSAR provides potentially significant economic and environmental advantages for end users over conventional heavy fuel oil. The economic case for MSAR remains solid despite the decrease in oil prices - and the cost of complying with ever more stringent environmental regulations is at the forefront of the industry," said Chairman Ian Williams.
During the testing period, Quadrise will also provide process chemicals, technical advice and support services to CEPSA. Quadrise and CEPSA have further entered into an additional bilateral agreement which clarifies which costs and benefits of MSAR production will be shared during the trial programme, it said.
In Saudi Arabia, Quadrise plans to build a pilot project which will involve the production, transportation and combustion of MSAR fuel. Quadrise said it has identified a coastal refinery to produce MSAR fuel, which would be consumed in a major thermal power station. This will also be done under a trial period.
Production capacity at the proposed coastal refinery is expected to be installed in "late" 2015, which would allow MSAR fuel to be produced for a trial period beginning in the first quarter of 2016, in line with its other trial with Maersk and CEPSA.
Additionally, the company is also evaluating opportunities to use MSAR fuel as a substitute for heavy fuels used for steam and power generation within refineries.
Quadrise said it has identified a potential opportunity to build another pilot plant, which it would develop with a unnamed "mid-sized refining company" in an unnamed location. Quadrise said it is conducting a four phase study related to the opportunity, which should be completed by the end of 2015.
"There are a number of 'fuel users' within the refinery and it is expected that, following successful demonstration, the use of MSAR will be progressively extended to fuel all of these requirements. The client requires that its name be held confidential until the feasibility report is reviewed and commitment is confirmed on commercial terms and implementation timing," said the company.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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