Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
Response from AEG's lawyers to DAQ regarding reason for additional devices onsite.
https://xapps.ncdenr.org/aq/docs/FDocs_Search.jsp
@hku821
RE: Could we ask them for an update on the plant as AEG won't tell us!
I'd be doubtful they'd release market sensitive info (if they were privy to it), as it could affect stock price.
It's tooth & nail now, for us invested & for AEG. We knew from the outset of the confirmed order that this would be the case. So it's a matter of hold your ground or retreat & sell.
I can only imagine, they are working around the clock to get this up and running, because end of the day, it benefits us all!
I think regardless if this order is filled on time, Pacifi Corp are still on board. They need to reduce emissions and perhaps are limited in their options. Pushing out a test date I'm sure would be preferable to closing power plants or reducing their output.. Of course, they know quiet well that hiccups happen in business. So I'd assume a delay would not be a deal breaker (my guess only, not definitive)
That aside, the IP still stands, and that is AEG's golden goose. Of the 1000's of coal fired plants around the globe, none will say, we don't want your technology because you missed a single test burn by a week or so.
The latest RNS stated confidence in meeting the order fulfilment date, so I suppose we have to take that at face value & hope for the best.
From what I can gather, we can continue without these, and commission.. what I don't know is if the modifications were just constructed on the ground but not fitted or incorporated into the plant. Also, if fitted, whether or not they can be removed to allow production to commence.
According to RNS an application has been submitted for the modifications. So yes, all we need is the approval. How long that will take is anyone's guess.
Sorry, try this link
https://xapps.ncdenr.org/aq/docs/FDocs_Search.jsp
For anyone interested, you can view a PDF of the actual notice via the link below.
It states that construction cannot continue on the modifications, but says nothing about stopping construction on the remainder of the plant.
https://xapps.ncdenr.org/aq/FDocsServlet
Having missed & now watched Michael's presentation, I made two observations that perhaps have agitated RMDE.
At around 12 mins 20 secs in Michael mentions the reference plant showing both licensees and potential joint venture partners how the plant can operate.
At around 21 mins 30 secs he mentions potential partners who'd like to have bigger size plants
I wonder if AEG, partnering with other manufacturing entities In order to fulfil or ramp up AEG's production quickly, with no licence fee for the venture partners to pay has led to Ron's outburst? Perhaps they see the licence fee as wasted money and could have got the use of Coalswitch without the down payment.
Food for thought
This hasn't been tradeable on Degiro since Dec. '20. There is no timeline to reverse it's decision.
Their responses to query raised:
17/12
Unfortunately this product has been restricted by our Risk team. It is currently not possible to purchase more of it, however you may hold or sell if desired.
26/02
There is no timeline to communicate for any restricted stocks being made available again.
Please let me know if you have any further questions.
@Seattle - slide 3 states $67m including undisclosed additional funds set aside for contingency and R&D.
This is a more recent publication than the one I posted recently detailing projected earnings.
@Rendj - It would be interesting to learn the full cost of a 50tph plant. In the video in this thread, Michael states $4m for the 5tph (already financed). I have requested info on the cost of the 50tph plant this evening, let's see if any info is provided.
Very interesting outlook for AEG from here.
1) Plan to sell into North America, then Internationally. (Multiple revenue streams) (RMDE already have full uptake of future 400,000 tonnes of Coalswitch).
2) Debenture released - A positive from invested CLN parties & belief in AEG's future. (I would imagine many conversations have been had behind the scenes & this is not just a hunch)
3) New personnel set to join the company soon, which suggests talks are underway & the company is evolving.
4) 50tph plant over 18 - 24 months. If this were to happen it would likely bring the company from a more or less non profitable
company to a +$20m profit. Fairly significant.
5) Potential new licenses upcoming. Bear in mind, US patent for CoalSwitch has been awarded & plans in place to file similar, on multiple continents.
6) 24% of US electricity comes from coal, and with US potentially rejoining the Paris Accord, this may accelerate the need to reduce coal plant emissions.
For me, the power of this company lies within it's licensing, particularly as it can be replicated globality, with little expense.
Lastly, we don't know the intent of Pacificorp. Regardless of whether their intention is to purchase CoalSwitch or a license. Either way, a post test burn order, would be the equivalent of a global recommendation.
Circa $200 per tonne for fully operational 50tph plant. This equates to $77m per annum and roughly $21m profit pre tax.
Excerpt:
? The revenue potential: Based on current expectations, AEG’s 5tph plant
(35-40,000 tonnes/yr) is likely to be fully commissioned and operating by
year-end 2019. The 5tph plant could generate ~$7m of revenue with EBIT
margins of 17-18% in the first full year of operation. However, full scale
commercial production is really driven by the build and commissioning of
the 50tph plant (up to 400,000 tonnes/yr), which would likely operate on
a run rate of $77m in revenue with an EBIT margin of 27-28%.
Slide 1:
https://www.uploadlibrary.com/SPAngel_Tania.Maciver/AEG_Transitioning_to_Commercial_Model.pdf
They actually produce 5,922 Mw's via coal burn at an estimated 9,000 tonne per 1,000 Kw's (slight amendment to numbers, but still circa 50,000 tonne/day.)
PacifiCorp have owned, and may still own coal mines. As is typical of Buffett's business models (I think) in that they essentially buy their resources from themselves, albeit from a subsidiary company, thus keeping profits inhouse & within Berkshire.
There is mounting pressure on PacifiCorp, and all coal fired power stations to move away from coal and seek alternatives.
There is a very interesting and recent article about PacifiCorps cost of energy being expensive to customers. This too eludes to them looking for alternatives, i.e. CoalSwitch.
Also, a company of this magnitude could easily source enormous amounts of feedstock globally! Which could result in unimaginable volumes of CoalSwitch being produced & royalties for AEG.
I'm not a fan of hypothetical numbers, however, I'll offer this scenario...
Consider the possibility that PacifiCorp were pleased with the test burn of the 900 tonnes of CoalSwitch & proceeded to buy a license at the $5 per tonne royalty fee & decided to & managed to completely replace coal with CoalSwitch.
Considering that both products have similar calorific qualities (see below). If Pacificorp were to produce circa 50,000 tonne per day, it would equate to over $90m per year in royalties. Again, this is hypothetical, however, it does highlight the potential this company is now sitting on. Particularly given they have secured IP via awarded patents.
Coal CoalSwitch
Calorific Value MJ/Kg 23.6 MJ/Kg 23 MJ/Kg
Info for calorific values:
https://www.aegplc.com/products/
Link to article regarding PacifiCorps expensive electricity:
https://www.sierraclub.org/articles/2020/06/pacificorp-oregon-coal-utility-rates-TAM
For anyone that want's to read up on the 50,000 tonne calculation, links below:
Info on burning coal:
https://energyeducation.ca/encyclopedia/Coal_fired_power_plant
Source: R. A. Hinrichs and M. Kleinbach, "Electricity: Circuits + Superconductors," in Energy: Its Use and the Environment, 4th ed. Toronto, Ont. Canada: Thomson Brooks/Cole, 2006, ch.10, sec.A, pp.320
https://en.wikipedia.org/wiki/PacifiCorp
Info on PacifiCorp plant capacities & coal usage:
https://en.wikipedia.org/wiki/PacifiCorp
My thoughts exactly!
I did some research last night & estimate (If info attained was accurate), that PacifiCorp burns roughly 50,000 tonnes of coal in all their plants combined, per day!
Ballpark:
10mw per day produced.
56% from coal
9000 tonnes needed per mw
With a 50tph plant, AEG could only replace 2% of their daily coal use.
PacifiCorp have the funds, ability and experience in running large plants to take on a licence and mass produce. Likely government backing too.
Makes sense to me.
Further thoughts ?