(Sharecast News) - Graphene nanoplatelet technology specialist Directa Plus announced on Thursday that its environmental services arm Setcar has been awarded a three-year contract with Liberty Galati - Romania's largest integrated steel producer.
The AIM-traded firm said the contract, worth €5.5m and potentially expandable to €8m based on rolling mills production volume, was focussed on providing a solution for the treatment of oily mills scale generated during steel production.
It explained that the formation of mill scale, or iron oxides, is a byproduct of the steel manufacturing process.
The waste material is created when billets, heated to nearly 1000 degrees Celsius, pass through rolling mills, interacting with oxygen, oil, and coolant water.
Roughly 2.5% of the metal weight from the workpiece becomes such waste during the rolling process.
Setcar's approach to addressing the challenge harnesses Directa's proprietary Grafysorber technology - a method for removing and recovering oil compounds from mill sludge.
By using Grafysorber, it said Setcar would allow Liberty Galati to recycle a considerable amount of oily sludge waste, transforming it into a raw material suitable for reuse in steel production.
"We are very proud of this achievement," said founder and chief executive officer Giulio Cesareo.
"This is the largest single contract signed by the group to date, equivalent to the 2020 yearly company turnover.
"Securing a multi-year contract with Liberty Galati is a very exciting win and demonstrates the building momentum for the group's products and solutions."
Cesareo said the company was targeting a new significant application for Grafysorber, with a "very large" global potential market.
"We look forward to working with Liberty Galati and showcasing the compelling advantages of Grafysorber and Setcar's solution for oily mill scale produced in steel making."
At 1433 BST, shares in Directa Plus were up 8.05% at 47p.
Reporting by Josh White for Sharecast.com.
Directa Plus (DCTA)