Quadrise Plc · LSE:QED
Quadrise — Shareholder Meeting (November 2018)
25 slides from Quadrise's shareholder meeting presentation, Nov 30, 2018
Slide 1: AGM Business Review
AGM Business Review 30th November 2018 1
Slide 2: The Emulsion Fuel Technology & Services Company
THE EMULSION FUEL TECHNOLOGY & SERVICES COMPANY • Supplier of proprietary MSAR® technology. • Produces low-cost/cleaner synthetic HFO. • Proven and verified commercially, at significant scale (~60 million tons Orimulsion). • Joint IP & exclusive global supply with Nouryon (formerly AkzoNobel Special
Slide 3: Executive Directors (Presenting) and Non-Executive Directors
EXECUTIVE DIRECTORS (PRESENTING) Mike Kirk Jason Miles Executive Chairman Chief Operating Officer • Former Partner at Cazenove, energy • Managed the commercialisation of BP / sector advisor and board member. PDVSA’s Orimulsion® business. • Joined Quadrise in 2015. • Joined Quadrise in 2006. • Chemic
Slide 4: A Challenging Year, But There Are Genuine Reasons for Optimism
A CHALLENGING YEAR, BUT THERE ARE GENUINE REASONS FOR OPTIMISM… Repositioning the Business: • Strategic review completed in Q2’18, lessons learned re sales diversification & partners. • Delivering MSAR® sales directly, and through global partners to broaden reach. • IMO2020 impacting fuel prices wor
Slide 5: Global Opportunities – HFO Hotspots
GLOBAL OPPORTUNITIES – “HFO HOTSPOTS” Americas Middle East Asia NOCs, refiners & utilities: Mostly NOCs & utilities: Mostly powerplants: Mexico 5-7m tpa Saudi Arabia >25m tpa Japan 10m tpa Ecuador 1-2m tpa Kuwait 6m tpa South Korea 2m tpa Russia >3m tpa Africa Marine NOCs, refiners, ~230m tpa HFO de
Slide 6: Extending Our Global Reach (1): Existing Partners
EXTENDING OUR GLOBAL REACH (1) Existing partners… Quadrise and AkzoNobel Working jointly on MSAR® projects in Specialty Chemicals have Japan, Colombia and Peru under MOA. worked together since 2004. Combining Quadrise MSAR® technology, additives and emulsion fuel experience with Following the acquis
Slide 7: Extending Our Global Reach (2): New Partners
EXTENDING OUR GLOBAL REACH (2) New partners… New Partnership with a European Oil Major recently announced for a programme of testing (residue to MSAR®) Working jointly with Quadrise on MSAR® and to investigate global supply projects in the Americas, Asia and the opportunities from a European refiner
Slide 8: Build-Own-Operate Prospects under Co-Marketing & Project Development Agreement
“Build-Own-Operate” Prospects under the Co-Marketing & Project Development Agreement About Freepoint Commodities LLC… • Freepoint is both an established global What does merchant of physical commodities and a “Build-Own-Operate” financer of upper and mid-stream (BOO) really mean…? commodity-producin
Slide 9: Positive Regulatory Environment
POSITIVE REGULATORY ENVIRONMENT 2020 IMO regulations are impacting the oil markets and global trade – not just the marine market. m BPD 1.5-2m BPD surplus of HSFO by 2020 - reducing price of HSFO relative to distillates and LSFO - driving use of marine scrubbers & HSFO use for power generation. (HSF
Slide 10: IMO 2020 Response - Scrubber Uptake
IMO 2020 RESPONSE - SCRUBBER UPTAKE The widening spread between low and high sulphur fuel has triggered a “sea change” in scrubber demand… Wood Mackenzie’s “base case” increase for the global shipping fuel bill in 2020 is $24 billion, compared with ~$100 billion today (+24%). Cruise and RoPax were i
Slide 11: MSAR Economics Benefit from IMO
MSAR® ECONOMICS BENEFIT FROM IMO • Widening GO/HFO spreads (the “delta” between the grey line and the red line) looking ahead… • Results in cheaper MSAR® (green line) vs HFO per unit energy… • Savings at the refinery pay for MMU module investment in under 12 months… • …Also provide sufficient fuel c
Slide 12: IMO2020 Low Sulphur (0.5%S) Fuel Quality
IMO2020 LOW SULPHUR (0.5%S) FUEL QUALITY Compatibility issues between different 0.5%S fuels will become more challenging, with most owners opting for gas oil. …As most VLSFO available will be blended from residual and distillate components, stability and compatibility will be key considerations. Dep
Slide 13: Research, Development & Innovation (RDI)
RESEARCH, DEVELOPMENT & INNOVATION (RDI) Lies at the heart of our offering... We are continually improving MSAR® technology and fuel performance at our UK RDI facility. Strengthening our IP and increasing entry barriers. Industry leader, attracting opportunities from major companies for MSAR® projec
Slide 14: Estimated Timelines
ESTIMATED TIMELINES… DEC 2018 DEC 2019… 2020! Project Progress JGC (Japan) Development Update Progress Supply Study YTL PowerSeraya Update Completed New JDA & Nouryon Exclusivity Agmt. Residue Testing Supply Study European Oil Major Completed Completed Project Progress Freepoint Commodities Developm
Slide 15: Summary
SUMMARY Genuine reasons for optimism in 2019: • Repositioned business – enabling our experienced team to work with major partners to accelerate development. • Global partners – YTL PowerSeraya, JGC, and exciting recent opportunities with Freepoint & European Oil Major. • Positive fuel market fundame
Slide 16: Quadrise Fuels International plc
(Quadrise Fuels International plc
Slide 17: What Is MSAR Technology?
WHAT IS TECHNOLOGY? Proven blending technology is deployed by QFI in oil refineries to mix ~70% residues with ~30% water and additives to make a lower cost HFO. Stable water-based MSAR® fuel can be transported & used in the same way as HFO. = Multiphase Superfine Atomised Residue 17
Slide 18: How Is MSAR Made?
HOW IS MADE? • Hot residue streams taken from refinery units and added to water, premixed with c1% additives in a high-speed colloid mill. • MSAR® cooled and transferred to tanks using existing HFO infrastructure and stored at ambient temperatures. • Extensive on site QA to ensure product quality fr
Slide 19: Economics
ECONOMICS MSAR® creates value at the refinery High value “premium” fuel used to create With MSAR® additional yield of 10-20% HFO is lost margin to the refinery higher value products can be sold Crude oil yield Crude oil yield High value fuel High value fuel sold as Low value Residue Water & <1% chem
Slide 20: Environmental Advantages
ENVIRONMENTAL ADVANTAGES Stored & transported at Lower combustion Virtually complete ambient temperatures temperatures carbon burnout Less heating = Less heating = Minimal black soot energy savings more energy savings P Reduction in global P Reduction in P 20-30% less NOX warming potential utilities
Slide 21: Proven Fuel Applications Experience
PROVEN FUEL APPLICATIONS EXPERIENCE Steam boilers Diesel engines Upstream (Power & Utilities) (Marine & Power) (Steam & Power) >60 millions tons of >150,000 hours of service on Successful Deer Creek emulsion fuel has been Wärtsilä 4-stroke engines, steam flood boiler trial. consumed for base-load In
Slide 22: Refinery Economics
REFINERY ECONOMICS Modular, Low Capex, Rapid Payback Profitable • ~$5-10m p.a. per 40t/h MSAR® unit (assuming refiner gets 50% savings). Low capex • ~$5m per MSAR® unit & tie-ins. Short timescales • Delivered & operating within 1 year. Rapid payback • $ payback typically <1 year. 22
Slide 23: Value Proposition to Consumers
VALUE PROPOSITON TO CONSUMERS 400MWe POWER PLANT VLCC TANKER consuming 600,000 tpa HFO consuming 15,000 tpa HFO MSAR® saving vs HFO MSAR® saving vs HFO $11-21m per year* $0.3-0.5m per year* CAPEX <$5m modifications CAPEX <$0.5m modifications Note* assuming 40% share of total refinery savings, remain
Slide 24: Proven Technology
PROVEN TECHNOLOGY CASE STUDY • A 40mT/h MSAR® system installed by QFI at Cepsa 240 KBPD Gibraltar refinery. • MSAR installation, commissioning, operations & quality control by QFI. • System designed to supply Marine & Power MSAR®, continuous or batch. • Processed visbreaker residue 24/7. • Supply vi
Slide 25: Quadrise Fuels International plc
(Quadrise Fuels International plc