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Cross-posting this as highly-relevant for TomCo.

As you all likely know, TomCo will be producing low-sulphur MSAR at the POSP soon. This is basically the ultra-premium edition of MSAR, because low-sulphur fuel is dramatically more expensive than high-sulphur fuel (over $120 per tonne more expensive per tonne in many ports) -- TomCo's LS-MSAR can be used without scrubbers, and most ships don't have scrubbers.

I am very excited to see if TomCo & Greenfield can get in on the low-sulphur marine fuel game -- there's a huge amount of margin available there. Consider that VLSFO has broken $500 per tonne at Singapore, while high-sulphur is about $360-370 and falling further behind every day.

The article is an interview about MSAR Marine and the MSC shipping trials from Paul Gunton in 'The Motorship' and is a must-read for anyone interested in MSAR:

https://www.motorship.com/news101/fuels-and-oils/msc-to-trial-emulsion-based-msar-fuel

Please share if you can!

A fantastic article about MSAR Marine and the MSC trials from Paul Gunton has just been published on 'The Motorship' and is a must-read for anyone interested in QFI and/or MSAR:

https://www.motorship.com/news101/fuels-and-oils/msc-to-trial-emulsion-based-msar-fuel

Please share far and wide if you can! I hope we can see more of this sort of quality journalism covering Quadrise and MSAR.

A couple of standouts snippets:

""
Speaking to The Motorship in early February, Quadrise CEO Jason Miles said that, if the operator goes on to use MSAR in its ships beyond the trial period, “that would mark a big turning point for the fuel and for the company.” Not only would MSC need large quantities of the fuel, it would also “set a significant precedent for the industry to follow,” he predicted.

He also believes that the same emulsifying techniques used for MSAR could also be used with renewable feedstocks such as lignin-based material, instead of refinery residue, to produce a 100% renewable fuel.

They will use MSAR exclusively for their propulsion, which is “quite a commitment,” Mr Miles said
""

It may be that the ethics approval process and/or studies have input from Oxford University and other academic institutions (some of which we know). Speculation: he's probably mentioning the most well-known institution that he feels gives it the most credibility, even if their involvement is not as important as other participants.

Plus, I think there's a very strong argument that a strong-and-steady stock is better for the core of your portfolio (and health) over the course of time. Certainly better than wild rollercoaster boom-and-bust stocks that are far too common at the moment.

My pleasure, all. Glad to be helpful in getting the vid out. I am looking forwards to the exciting couple of months CF describes.

Hey guys. I got sick of having to re-register and scroll through all the other crap that was playing before Cathal came on to share with my investment friends. So I downloaded the vid and quickly chopped out just Cathal's segment using DaVinci Resolve. I've stuck the vid on WeTransfer if you want: https://we.tl/t-vwWCfwckNz

This might be my favourite video that he's done so far -- and he showed a great awareness of the needs and interests of retail shareholders (e.g. getting Invesco off, sorting out the broker guidance, etc). There's just so much great stuff in the pipeline, I'm sure we are all glad to have continued holding and being patient.

https://www.youtube.com/watch?v=gw6ystAHF34&feature=emb_title

A few minutes into the vid, a segment covering the TomCo/Greenfield project at POSP and their upcoming MSAR fuel trials.

Tidetime, you are correct.

Jason Miles has said they have no reason at all to believe they can't emulsify it, and it should be appropriate for both Power MSAR and Marine MSAR products. Their off-the-shelf formulations get them 99% of the way there, but some empirical methods are used to fine-tune it and ensure the fuel meets the commercially guaranteed quality specifications - they want provide a top-quality, stable, and clean product to customers that burns extremely well, all whilst being at the correct viscosity.

To put it another way, there's some quantum chemistry weirdness down at that level which means some manual tweaking of the formulation is needed: it's not currently possible to produce the perfect formula without hands-on access to the residue.

BTW, QFI were sent some samples previously from nearby facilities by Greenfield, but they were heavily contaminated with chemicals and other substances. So, undoubtedly Greenfield want to wait until everything is stabilised and they have a production-grade 'clean' sample to send to QFI.

In fact POSP crude is a much less 'difficult' residue than those they are used to handling from refineries such as FCC residue or SDA residues; those are units that break up or separate the hydrocarbons in a heavy residue to allow more light distillates to be produced, but leave behind a smaller amount of ultra-heavy residue, in many cases they are thousands of times more viscous than POSP bitumen.

I have total confidence that POSP crude will be extremely compatible with the MSAR process.

bryaz - Entirely possible that a new large buyer (Chinese phama company/companies I guess) may be willing to pay an above-market rate to get Invesco out.

It's clear that Cathal is acutely aware that they are weighing us down, and in the past he's worked to get persistent sellers off the books.

Here's QFI's chairman Mike Kirk with a snippet on Greenfield/TomCo today - https://twitter.com/QFIPLC/status/1356631103684100106/photo/1

Things can get moving very quickly once the samples have arrived.

Apologies, missed RR's comment. Essentially agree with your take.

From the recent video they said they were still tweaking stuff to ensure optimal solvent recovery and extracting all of the bitumen from the sand for all the ore/sand variants they have encountered.

I suspect that means the properties/chemistry of the produced oil will change a bit once they've got it perfected, so it likely makes sense to wait for everything to stabilise before sending the samples off to Quadrise (i.e. to ensure the most accurate formula for the 'real-world' bitumen the site will actually produce).

Jack - dry bulk is not the same as breakbulk. By way of comparison, Oldendorff have a fleet of nearly 700 vessels they are currently operating. That's more than the entire top-10 list.

Break bulk is stuff like huge oversize wind turbine parts, logs, rolls of aluminium, etc. Doesn't fit into a standard ISO container.

Dry bulk is stuff like wheat, corn, iron ore, copper ore, coal, etc, that can be poured or craned into the holds.

As I've outlined on the QFI Shareholders Forums, my guess would be Oldendorff, as they tick all the boxes in terms of size, fleet composition (large *owned* fleet), and rollout of scrubbers. As you guys have pointed out, the dry bulk market is more fragmented and doesn't have as much public data as boxshipping, but my research indicates Oldendorff are probably number 1 or 2.

COSCO Bulk are likely also top-2, but don't really fit the profile as described by Quadrise.

3 could be a range of different operators, depending how you count it. It's a much trickier one to gauge!

Just my thoughts and I have no special insight.

Fyoz - MSAR Marine economics depends on the high sulphur fuel oil - gas oil spread. It's already quite good, and looks to be widening over time. You can basically subtract the cutter [1] portion of every tonne of IFO380 that would normally be required to dilute it to 380cst.

QFI's example: "Base case HFO blend; 60% residue / 40% cutter valued at 85% of Gas Oil."

LS-MSAR will be even more compelling, I suspect!

[1] With some discount on gas oil for crappier quality cutters like LCO; so QFI guide "85% of gas oil". I imagine LCO pricing might be a better guide?

re, potential future bulker client: it's certainly not Maersk. The QFI team said the bulker are a top-3 dry bulk operator (with a large dry-bulk fleet that has a good number of scrubbers deployed).

Maersk do offer some containerised bulk, but do not own a dry bulk fleet of any significance, and are most certainly not top 3. Furthermore, they have not deployed a significant number of scrubbers outside of their ultra-large containerships.

That rules them out as the bulker customer.

@elir71 - my understanding is that bio-infestation can still occur with emulsion fuels, so they can add biocides if there's going to be a very long storage period for the fuel. I'm not sure of the details of which type of biocide they use or whether it's been observed or is just hypothetical for now, but this was brought up in one of the Q&As and QFI said it wasn't a major issue at all.

Yes foxm, similar to my own findings; and crudes are naturally a blend of all those different fractions, so that brings the per-barrel sulphur average right down. Once you take away the valuable light fractions, the sulphur generally accumulates in residual fractions, so (made up numbers) your 0.2% crude might produce a 0.8% residual stream.

There are some technologies to desulphurise oils, but all of those I'm aware of are quite energy intensive.

foxm, my assumption is that indeed LS-MSAR probably will struggle to meet 0.1% SECA standard as sulphur tends to accumulate in the heavier fractions. One small note, for the MSAR sulphur level guesstimates you made: you can't count the water, as non-calorific content is not used in equivalence calculations (otherwise you could just add loads of water to technically comply!).

Assuming all continues to go well, Greenfield's low-sulphur MSAR will occupy a unique niche that no other MSAR product currently does: IMO2020 compliant low-sulphur MSAR (aka LS-MSAR). That means vessels can use LS-MSAR without scrubbers in most waters (exception being 0.1% SECAs).

To make an obvious point, there are far fewer vessels with scrubbers than without, and scrubbed vessels can burn LS-MSAR, but unscrubbed vessels can't burn HS-MSAR and remain compliant.

So that's a profitable niche that Greenfield could carve out for itself.

The market isn't currently factoring any of that into today's share price for some pretty obvious reasons, but I think this will be increasingly relevant once they get going (and hopefully crack the low-hanging fruit of industrial and power usage first).