Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
Even if they dilute by raising £6m to cover the site, if financing is obtained, as suggested in the RNS, for building the plant, the uncertainty around the financing will be completely removed. In that case, does the paltry market cap really reflect the value of a 5,000 or 10,000 bopd plant?
The issue I have at the moment is in the latest RNS they mentioned that the production of 180bopd had been reached and that they expect shortly 250bopd. Since the 25th of May 2021 they have manged to extract 740tonnes of sand. If we assume that for each tonne of sand there is 1 barrel of oil that would assume an average of 35bopd per day. It's possible they're not running the trial continuously but at a rate of production of 180bopd we could expect the amount of sand produced to be completed within just over 4 days.
From the PQE RNS relating to this specific project:
"The production of the first load of sales oil from the upgraded POSP is an important milestone that demonstrates that heavy oil from the Utah oil sands can be produced using Petroteq's CORT process without the use of water and without any requirement for a tailings pond."
It would still be better to have QFI technology involved but to suggest that the PQE technology alone is producing bitumen is untrue. For me, such claims being made on a TOM board is an attempt to ramp QFI stock.
I've already explained that the use of QFI technology is value adding. It reduces the cost per barrel by up to $25. It also allows the fuel oil produced to be diluted further to produce MSAR for other uses thereby increasing the customer base.
Not suggesting it should be left out at all. Simply challenging the narrative that the only use of the fuel oil is for road tar etc. I entirely agree that the use of QFI technology is a no brainer but also believe TOM, though less profitable, will still be profitable without it.
Quadrise technology also opens up opportunity, as viscosity can also be reduced further to suit the use, hence why it opens up the market to sell more. However, it is not bitumen that is being produced by Petroteq is my primary point.
I'm aligned with everything you say here. It's also worth noting, beside the sellable sand "by product", there will have been a likely impact on the fuel oil price since the time the article was written. With that being said, the value of the sand for me is significant.
Suggest rereading:
"We have highlighted marine bunker fuel as an end market for Greenfield’s product. However, this is not the only possibility.
The final stage of the separation process is being configured to apply a system developed by a company called Quadrise (LON:QFI), to produce a water/oil emulsion which can be used as a direct substitute for existing fuels in three main applications:"
With all due respect, I think you might be the one confused here.
https://www.proactiveinvestors.co.uk/companies/news/923788/tomco-energy-oil-sands-project-moving-forward-923788.html/long
The production of fuel oil is something that's been plastered everywhere, including implicit mention on the Tomco website under the Oil Sands Opportunity page. "marine bunker fuel, with no further refining". I'm surprised you weren't aware of this already.