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There are indeed some similarities but there are many more differences. Enerkem have raised CA$ 616.50, operate a commercial plant since 2015, and have CA$ 30M revenues.
You all can keep debating this ad infinitum but that will not change the basic premise: Velocys is not able to find investors to get both projects, Bayou Fuels and Altalto, off the ground. The PP will not change the equation, as the USDA Loan guarantee, Velocys obtained years ago, did not either. Why is that. IM and Thurgaton are convinced that both projects are the best ever, while XPB keeps reminding us that the investment needed is too high. So far, I am leaning towards XPB’s point of view since VLS has not been able to land an investor in the last 4 years for Bayou Fuels and the last 2.5 years for Altalto.
Why would an institutional investor sell at 3p when he bought at 225p??
I wonder if Velocys will be able to raise funds in the current economical environment. It was going to be a hard sell without the approval, it just become much harder in the current downturn.
Stretchum: Velocys has developed microreactor technology which handles exceptionally well the very active Fischer Tropsch catalyst developed by Oxford Catalyst. The Velocys FT technology covers about 12 to 15% of the total waste to jet fuel plant. The other operations to convert waste to jet fuels are licensed from other companies, as is clearly stated in the February 2nd press release regarding the appointment of Worley as engineering partner.
Amanti's statement is stretching the truth.
IM: What is it that you feel the need to defend so aggressively your opinion by bullying other people? Uncertainty?
Unfortunately, the GOP controlled senate will not go along...Let's hope they will loose the majority in November.
There is unfortunately one missing part in the RNS: the technology to sort and convert the municipal waste into a feed stream for the TRI gasifier.
By the way, I am glad to see that TRI is finally officially the gasifier technology supplier for Altalto. Although they have not yet proven their technology at this scale, it will be used at the Fulcrum plant which is under construction. The latter is said to start up later this year. By the way, Fulcrum's feed processing plant is in operation since 2016.
Expatbrat is correct in his assessment of the technology to be used at Altalto: VLS's FT technology is about 12% of the total investment. If I would have due diligence on this project, even if I would be convinced that the VLS technology is proven the upstream technologies: sorting the MSW, preparing it for the gasifier, feeding it into the gasifier, converting it in the gasifier, cleaning the syngas, are the ones I would focus on. So far VLS has not mentioned their upstream technology partners, which weakens their case to seek investors. The more that VLS does not have a project development track record.
Shell has developed, with GTI, their own technology called IH2. They built a 5 ton raw material demo plant in Bangalore. I wonder why Shell is looking at Velocys technology when they have thier own.
https://www.shell.com/business-customers/catalysts-technologies/licensed-technologies/benefits-of-biofuels/ih2-technology/demonstration-facility.html#iframe=L2loMi1kZW1vbnN0cmF0aW9uLWZhY2lsaXR5
The Shell announcement is not very relevant to the Altalto project. Shell is broadening its options.
Here is an interesting recent article describing the actorsin the sustainable aviation fuel:
https://www.biofuelsdigest.com/bdigest/2019/08/25/9-constellations-to-watch-a-look-at-the-rising-stars-in-the-race-to-saf/
The paragraph on Velocys contains an error: Shell & BA did not invest in Velocys, they invested in the project.
EB: VLS has been working with TRI longer than you indicate as the VLS press release of January 26, 2017 indicates because they selected TRI for the Bayou Fuels project.
S&W: Your first sentence says: "Velocys has a proprietary process that can convert woody biomass or municipal solid waste into high specification liquid fuels including aviation grade kerosene." This is the deviation because it is only partly true.
TRI is VlS partner for the Bayou Fuels but unannounced for Altalto. The downstream part of the process is probably Haldor Topsoe technology.
S&W: let's be realistic and stick with the facts. Velocys owns the Fischer Tropsch (FT) technology to convert syngas to liquid and solid hydrocarbons, which then with non-Velocys technology have to converted into jet fuels, diesel fuels and waxes. The Velocys owned technology is a small but essential part to convert MSW and woody biomass to jet fuels.
The Velocys' projects, Altalto and Natchez Biofuels, require other technologies, such as gasification of the MSW and woody biowaste and FT product upgrading to produce the desired salable products. These technologies and the CCUS technology, to mitigate the CO2 emissions are non-Velocys technologies which have to licensed by the project.
The Velocys technologies are the FT catalyst, an Oxford Catalyst invention and the FT reactor, a Velocys invention.
The issue is that they gave up their technology development to jump into project development. As a consequence they are in no man’s land: they are project developers without track record of successful projects and a technology company which cut off their R&D capabilities. They need to commercialize their technology ASAP before the competitors catch up. Unfortunately it might be too late...
EB: the 2nd part of the Fulcrum plant, the gasification of the waste and the FT, are under construction.
Don’t also forget Enerkem which has a waste-to-ethanol plant in operation in Canada and which is planning a second one in Rotterdam.
It is a tough competitive world out there and Velocys being more like an underdog should look for the right place to participate in the market.
The major difference between Velocys and Fulcrum is that the latter is not saddled with their own FT technology. They could get out and license the best technology available without sinking lots of money into development. BP invested $30M Fulcrum and could have convinced Fulcrum to switch from Emerging Fuels Technology to Johnson Matthey and BP’s FT technology.
In other words Fulcrum kicked out less proven technology in favor of a more proven one.
Thanks, Thurgaton. I did indeed overlook the Toyo deal. It is not clear when the Toyo cash will come in. There is an order of £0.4M and a non refundable tranche of £0.4M. The rest is subject to milestones. That will extend the runway one month.
Just do the numbers:
31-Dec-18: £7.0M
30-Jun-19: £1.3M
July raise: £7M before expenses.
Hence cash burn approx £1M/month
If nothing happens they are back at £1M cash in the bank around 1-Feb-20.
VLS will need to raise more funds next January.
Let's be realistic here. Fulcrum is way ahead in the waste-to-fuels area. They have already a feedstock processing facility in operation and the plant is under construction and they have sufficient equity partners, such as BP, United, Cathay Pacific, Waste Management etc. The process is fully funded and the technology used, except for the gasification by TRI, is of commercial grade.
My concern is that Altalto plant has not addressed the feedstock processing technology. This could be their achilles heel. This was not a concern when Suez was on board in the early version of this venture. The gasification part of the Altalto is another mystery. Originally, this was supposed to be Advanced Plasma Power technology. However APP went bankrupt and Velocys has never mentioned which technology they would license. A while ago, in a discussion on another board, it was mentioned that Altalto would also use TRI technology but this has not been confirmed.