LONDON (Alliance News) - TomCo Energy PLC Friday said Red Leaf Resources Inc will accelerate the commercial development of its Early Production System, the technology that TomCo is waiting on to begin construction at its Holliday shale project in the US.
Red Leaf Resources Inc neighbours TomCo's Holliday project and is providing its technology to the company. It is developing the Early Production System, which is a capsule using technology that allows companies to produce high quality liquid transportation fuels from oil shale more economically and in more environmentally friendly ways.
In February, TomCo said it will only progress with commercial-scale construction on its Holliday Block once the results of Red Leaf's capsule are known and said Red Leaf had postponed the completion of the capsule until the second half of 2016 due to the current oil price which sent shares tumbling.
However, on Friday, TomCo said Red Leaf has "decided to accelerate commercial technology optimization for the Early Production System" as a "result of the low commodity oil price environment, as well as recently identified efficiencies and engineering advances that may be utilized in the commercial demonstration project," it said.
"This is an acceleration of design optimization and an adjustment to the construction schedule to allow for incorporation of the design improvements," said Adolph Lechtenberger. "We had anticipated the design optimization work to take place after completion of the EPS, but we have an opportunity to include the second generation commercial technology sooner rather than later."
No details were given about when the Early Production Capsule will be constructed, but TomCo and Red Leaf said the financial commitments remain "solidly in place", and said the enhancements will improve the economics of the technology being used in the capsule.
TomCo shares were up 11.7% to 0.229 pence per share on Friday morning.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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Tomco Energy (TOM)