Member Info for Fernan10

This article summarizes the hurdles that green hydrogen need to overcome, in order to be an economically viable energy option in the future.

I still think this is a project for the next decade, if ever.

______________________________________

While green hydrogen holds great promise for a sustainable future, it still faces several challenges that need to be addressed before widespread adoption can take place:

*High Production Costs: Currently, electrolysis technology used for green hydrogen production remains expensive compared to traditional fossil fuel-based methods.

*Limited Infrastructure: In order for green hydrogen-powered transportation or industrial processes to become widespread, there needs to be significant investment in infrastructure such as refueling stations or pipeline networks.

*Efficiency Losses: During the electrolysis process, energy losses occur, leading to lower overall efficiency compared with traditional fossil fuel-based technologies.

*Safety Concerns: Hydrogen gas has explosive properties if not handled properly, leading some people to question its safety, especially regarding transport & storage.

*Limited Supply Chain: The current supply chain for green hydrogen remains limited, meaning that scaling up production may prove challenging until more suppliers enter the market.

https://oilprice.com/Alternative-Energy/Renewable-Energy/Green-Hydrogen-Will-Play-A-Critical-Role-In-A-Net-Zero-Future.html

"Not sure we will find any interesting investor in case we decided to sell it."

I was referring to the green hydrogen division

Chariot´s managemente have already provided some info, in order to value the renewable energy division (solar + wind, excluding hydrogen).

In Char´s May 2022 presentation (page 8) they made the following assumptions for a 50 MW solar energy farm:

Gross cost: US$ 50 million

Annual Revenue: US$ 12 million (gross)

Annual EBITDA: US$ 9 million (gross)

CHAR currently have a 50% equity interest in a pipeline of future projects for a total of 1 GW, yet to be developed.

Assuming that it ends with a 15% carried interest in each project, then, after having all projects running, we will have:

Total future renewable energy capacity: 1GW (gross)

Annual EBITDA (net to CHAR): US$ 9 million / 50 MW X 1GW X 15%: US$ 27 million

Market cap: 5 X EBITDA

Market cap: US$ 135 million

That´s the potential valuation from the pipeline of renewable energy projects, maybe 5 or 6 years from now.

At the current stage, I don´t think it´s worth more than 30 or 40 million.

I´m not assigning any value to the trading license in South Africa. They first need to show a few years or consistent profitable operations, ir order to calculate its intrinsic value.

Regarding green hydrogen, as I said before, it´s currently in the testing phase. Nobody knows for sure if it will be economic one day. There are a lot of question around green hydrogen, including: production cost, lack of infraestructure, transportation cost, regulatory uncertainty, etc.

Not sure we will find any interesting investor in case we decided to sell it.

Regards

The bold;

you´re a funny guy/lady.

You never stop surprising me.

Olderandwiser:

I like questioning other people´s oppinions...it´s the only way I know to learn something.

Regards

Ok Jimmy thanks

Very reassuring.

Regards

I found a report that informs gas flow rates of an average 1.36 mmcfd per meter of net pay in the Rharb Basin (where Anchois is located).

https://www.reddit.com/r/PredatorOilandGasPRD/comments/t8ssg0/mou1_the_rharb_basin_net_pay_vs_well_flow_rate/

The issue here is that all wells analized in this report are located in the Sebou Exploitation concession, 80-100 km from Anchois.

Jimmy: do you think that the distance of those wells to Anchois could reduce the comparability and extrapolation of those results?

Ok Jimmy thanks very much for your response.

Regards

Ok Jimmy thanks very much for your response.

Regards

You are wrong

Current market cap is c. US$ 100 million.

If, as you said, the market were adscribing no value to Anchois, that would mean that the current market cap is assigned wholly to the renewable energy projects (that have no funding secured) or green hydrogen (a project with no markets, no proven technology, and an uncertain future, to say the least).

Hi Jimmy.

I understand that the development plan envisages the production of 150 mmcfd of gas from 3 producer wells.

Then, the market is expecting a flow rate of 50 mmcfd for the upcoming well. Anything lower than that will be dissapointing.

Is that right?

Regards

Germany will contribute 40 million euros to fund a feasibility study and pilot projects for the production of green hydrogen in Namibia.

Namibia has almost twice as much sunshine hours per year as Germany .

Due to local constraints on fresh water availability, they will try to find a solution to produce hydrogen by electrolizing previously desalinated water.

https://www.bmbf.de/bmbf/shareddocs/kurzmeldungen/en/Karliczek-Germany-and-Namibia.html

We need to find this type of government funding, in order to progress this business "pillar" without substantial dilution for shareholders.

Hi Jimmy, how are you?

I have the following questions for you:

1. is the flow test to be performed on each sand (A, B, C, M) independent of each other? is it possible to have one sand having a flow test of, say, 30 mmcfd, and the next sand flowing nothing at all? or are all of them interrelated?

I assume that, if the flow test of each sand is somewhat related to the others, then risk is higher than in the case of totally independent sands.

2 do you think that, should the new sands to be explored (N. Flank and Footwall) result in a discovery, are they going to test them in the same well?

Regards

This is a capital-intensive business. And we don't have any money to invest here.

I expect CHAR to end with a 10-15% carried interest after farming its equity share out.

"Power utility Zesco has introduced daily eight-hour loadshedding for its retail customers and initiated consultations with mining companies to reduce power supply to the sector by 150 MW from May 1 to December 31. First Quantum’s operations are expected to have power curtailed by about 80 MW over this period."

"In addition to sourcing power from neighbouring countries, the miner is advancing renewable energy projects to enhance its energy resilience. One such project is a partnership with TotalEnergies and Chariot Energy to develop a 430 MW solar and wind project, with expected commissioning dates in 2026 and 2027, respectively."

https://www.miningweekly.com/article/first-quantum-navigates-zambia-power-crisis-through-imports-renewable-projects-2024-04-24

"Higher levels of load shedding and associated disruptions likely in Zimbabwe through at least early July amid drop in energy production."

"As of June 25, the Zimbabwe Electricity Supply Authority (ZESA) is implementing higher levels of load shedding; disruptions are likely through at least early July. Power cuts have lasted up to 10 hours in some areas."

https://crisis24.garda.com/alerts/2024/06/zimbabwe-authorities-likely-to-implement-higher-stages-of-load-shedding-through-at-least-early-july

CHAR is developing a 30 MW solar project to supply electricity on site at Karo´s platinum mine in Zimbabwe.

"Zambia is facing an energy crisis caused by low water levels in its hydropower plants due to the drought experienced in the 2023/2024 season."

"...as of July 31, the national peak demand for electricity stood at 2,400 megawatts while the available power generation was only 1,040 megawatts, leaving a deficit of 1,360 megawatts."

"The situation has forced Zambia to introduce a rotational power cuts program"

https://english.news.cn/20240802/28368349d18446cf994e1a3e783eaacc/c.html

CHAR is currently developing a 430 MW solar and wind project to supply a First Quantum mining complex in the country. It´s CHAR´s biggest renewable energy project.

The principal source of electricity in the country is hydropower, subject to seasonality.

Another interesting business opportunity, where the offtaker (the mining company) should be anxious to secure a reliable source of power for its operations.

It seems that CHAR´s renewable energy projects in Africa are not only to "decarbonize" mining production, but also to allow the offtakers a seamless operation, free from power cuts.

Corporate south african users of electricity (industries, commerce) must be highly incentivized to find a reliable source of power, in order to minimize economic losses provoked by the continuous blackouts.

That´s the business opportunity that CHAR is pursuing through Etana

Https://theconversation.com/why-southern-africas-interior-is-an-ideal-place-to-generate-solar-energy-161030

It seems the power generation capacity of the country is not enough to meet demand, by a long distance.

Planned and unplanned blackouts ("loadshedding") have been usual during the last few years.

"anyone who is 17 or younger has never experienced what it means to live without regular scheduled power cuts, known locally as loadshedding."

Current generation is based primarily on coal. The country desperately needs to add capacity, preferably from renewables sources (solar and wind).

"South Africa has some of the best wind and solar resources in the world. There is no need to force a shift from coal to gas. Instead, South Africa needs to transition to renewable energy plus backup, which is batteries and a substantial gas reserve."

https://theconversation.com/south-africas-electricity-crisis-a-series-of-failures-over-30-years-have-left-a-dim-legacy-227936

This situation could explain the strong interest showed by local banks and investors to develop additional power generation capacity.

It seems Adonis has found an interesting business opportunity to exploit.