Slide 1: Q2 and H1 2023 presentation
Q2 and H1 2023 presentation 15 August 2023
Slide 2: About this presentation
About this presentation THIS PRESENTATION IS NOT FOR PUBLICATION NOR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO AUSTRALIA, CANADA OR THE UNITED STATES (INCLUDING ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATED AND THE DISTRICT OF COLUMBIA) OR ANY OTHER JURI
Slide 3: Today's presenters
Today’s Jan Kielland Chief Executive Officer Ingar Bergh Chief Financial Officer presenters Cato Christiansen Chief Technology Officer
Slide 4: Capsol at a glance
Capsol at a glance Accelerating the world’s transition to a carbon-negative future • Highly competitive carbon capture technology – safe, flexible and cost-efficient Oslo • Based on potassium carbonate as a solvent and applicable to Berlin all CO2-intensive industries worldwide • Proven solution wit
Slide 5: Highlights
Highlights Sales pipeline of ~135 active leads totalling 42 million tonnes of CO2 An increase of 30% since Q1 2023 – high activity across all key segments Fourth CapsolGo® demonstration campaign awarded in Germany at an EEW energy-from-waste plant Expected start-up during Q3, full-scale deployment o
Slide 6: Hottest July in human history is a wake-up call for climate action
Hottest July in human history is a wake-up call for climate action Daily surface air temperature (°C) Data: ERA5. Source: C3S/ECMWF 6
Slide 7: A step change in CCS efforts required
A step change in CCS efforts required CO2 captured per year – Rystad Energy 1.6dg Scenario 9 000 Energy Industry Power Removal (BECCS & DAC) 7 849 6 604 8 000 Million tonnes capture capacity installed • Carbon capture and storage (CCS) will play a critical role 7 000 in avoiding irreversible climate
Slide 8: Capsol's cost-efficient technology makes CCS viable for more emitters
Capsol’s cost-efficient technology makes CCS viable for more emitters Reduced energy consumption Patented process for re-using heat, the main cost driver for CO2 capture, enables ~40% lower cost vs. traditional amine technology1 and capture cost Low operational risk Proven technology with 4 000+ ope
Slide 9: Carbon capture technologies to support all industries
Carbon capture technologies to support all industries CapsolGo® demonstration units CapsolEoP® (End-of-Pipe) CapsolGT® for gas turbines 700 tonnes CO2/year 100 000+ tonnes CO2/year 12 000 to 400 000+ tonnes CO2/year EUR 150k - 250k per month EUR 7-12/tons installed Potential for higher revenue vs Eo
Slide 10: Focusing on large industries with high CCS potential together with leading partners
Focusing on large industries with high CCS potential together with leading partners • Will expand into other industries Cement 30% Biomass / Bio-Energy CCS 8% • The company has partnered with industry leaders enabling efficient • Largest industrial emitter • Increasing need for carbon removal as the
Slide 11: Targeting significant long-term value creation with a scalable licensing model
Targeting significant long-term value creation with a scalable licensing model Strategic focus 2025 goals 2030 goals Technology Continue to develop and protect cost advantage to ensure long-term competitiveness 5-10% Technology licensing market share Product Commercialise new products and services t
Slide 12: Operational review
Operational review
Slide 13: 30% growth in pipeline since Q1
30% growth in pipeline since Q1- totaling 42 million tonnes of CO2 to be captured Sales engineering Engineering Engineering Final investment In operation studies1 to build2 decision (FID)3 Projects 122 10 1 Million tonnes >37(+7) 4.2 (+3) 0.8 CapsolGo® fast-track2 Projects 4 Technology licensing agr
Slide 14: Fourth CapsolGo campaign awarded in Germany
Fourth CapsolGo® campaign awarded in Germany • CapsolGo® demonstration campaign at EEW’s Energy-from-Waste (EfW) plant in Hannover, Germany • All-inclusive service with a testing and validation program, providing EEW with valuable data and information on CapsolEoP® (End-of-Pipe) capture technology •
Slide 15: Stockholm Exergi project on track
Stockholm Exergi project on track • Stockholm Exergi is progressing the full-scale Bio-Energy Carbon Capture and Storage (BECCS) facility using Capsol’s proven technology • On 26 July 2023, Stockholm Exergi signed a Letter of Intent with Saipem for engineering, procurement and construction (EPC) act
Slide 16: Expanding footprint in the world's leading CCS markets
Expanding footprint in the world’s leading CCS markets 675 million tonnes of CO2 347 million tonnes of CO2 5 010 million tonnes of CO2 emission per year emission per year emission per year Germany The UK The US • Opening of office in Berlin in • First hire operational from Q2 2023 • Planning to be o
Slide 17: Gas turbine solution development on track
Gas turbine solution development on track, expanding Capsol’s market opportunity Ability to handle low CO2 concentrations while generating electricity • CapsolGT® carbon capture solution for open cycle gas turbines – capturing >95% of carbon dioxide while enabling additional electricity generation •
Slide 18: Deep dive: Solid traction in the cement industry
Deep dive Solid traction in the cement industry
Slide 19: Cement is the largest industry opportunity for CCS
Cement is the largest industry opportunity for CCS • 8% of global CO2 emissions • Cement a foundation for green transition • CCS only viable alternative to reach net zero • Expected to account for 30% of total CO2 capture in 20301 • After 2030, one new full-scale CCS plant is required per week2 Sour
Slide 20: Capsol has an attractive value proposition for cement
Capsol has an attractive value proposition for cement • Flexible and easy to integrate – minimal production downtime • Can be run on renewable electricity – no need to burn additional hydrocarbons • High CO2 concentration in the flue gas (15-20%) – major advantage for CapsolEoP® technology • About 0
Slide 21: CapsolEoP for cement – superior energy efficiency
CapsolEoP® for cement – superior energy efficiency Traditional post combustion absorption (amines) CapsolEoP ® • Energy requirement is predominantly heat • Energy requirement is mostly electricity to pressurise flue gas • Heat consumption is a weak function of CO2 concentration • Electricity consump
Slide 22: Gaining traction with the largest cement producers globally
Gaining traction with the largest cement producers globally United Kingdom Location undisclosed Europe ~700 000 ~1 000 000 1 000 000+ tonnes of CO2 per year (full-scale tonnes of CO2 per year (full-scale tonnes of CO2 per year (full-scale deployment) deployment) deployment) Short-listed as technolog
Slide 23: Financial review
Financial review
Slide 24: Accelerating demand growth in Q2 2023, focus on increasing engineering capacity
Accelerating demand growth in Q2 2023, focus on increasing engineering capacity Financial highlights Revenues were NOK 5.2 million in Q2 2023, an increase of 24% from Q1 Revenue NOK 5.2 million Pre-tax profit NOK -15.2 million 2023. Pre-tax profit was NOK -15.2 million, compared with NOK -10.3 milli
Slide 25: Higher revenues and capacity ramp-up
Higher revenues and Revenue (NOK million) Pre-tax profit (NOK million) capacity ramp-up 8,0 0,0 Q3 Q4 Q1 Q2 22 22 23 23 The development in Q2 2023 was mainly driven by revenue 7,0 -2,0 from CapsolGo® One CapsolGo® was operating during the quarter, while the 6,0 -4,0 second unit has undergone an upgr
Slide 26: Maintaining capital discipline
Maintaining capital 38,5 Cash flow for Q2 2023 (NOK million) discipline 12,7 33.5 Keeping cash burn low and focusing on value adding 0,8 services 5,2 -1,7 Total cash burn for the quarter about NOK 5.0 million -1,7 -15,2 Revenue + pre-paid revenue about NOK 10.5 million -5 Quarterly operational cost
Slide 27: Comfortable financial position
Comfortable Cash position and committed spend next 12 months (NOK million) financial position 52 Dynamic ramp-up with flexible cost base NOK 33.5 million in cash by end of Q2 2023, compared to NOK 38.5 million in Q1 2023 Committed spend and committed revenue next 12 months leaves a capital buffer of
Slide 28: Concluding remarks and Q&A
Concluding remarks and Q&A
Slide 29: Ambition: 2030 goals for long-term value capture
2030 goals for long-term value capture Ambition 1 Make point source carbon capture accessible and viable for more emitters Top 3 position in target segments: cement, biomass, 2 waste-to-energy and gas power plants Building a leading global carbon capture technology company 3 Achieve 5-10% carbon cap
Slide 30: Several key milestones expected next 6-12 months
Several key milestones expected next 6-12 months De-risking the path towards long-term goals achievement Awarded CapsolGo® Licensing Project New engineering contracts agreements FID1 partnerships studies In Europe, US and First unit in the US Within segments First FID generating Enter into rest of w
Slide 31: Investment highlights
Investment highlights Climate change calls for large-scale CO2 reductions Significant CCS ramp-up expected towards 2030; Potential licensing market of EUR ~60-80 billion in accumulated revenue 2023-2050 Offering energy-efficient, safe and proven carbon capture Patented process enables ~40% lower cos
Slide 32: Q&A
Q&A
Slide 33: Thune Eureka Building, Oslo, Norway
Thune Eureka Building Drammensveien 126 0274 Oslo, Norway Our vision is to accelerate the worlds capsoltechnologies.com capsol.com transition to a carbon negative future
Slide 34: Enabling a sustainable future
Vision Accelerate the world’s transition to a carbon- negative future Enabling a sustainable future Mission Deliver energy-efficient and safe carbon capture technologies 34
Slide 35: Value chain overview
Value chain overview Carbon capture EPC1 Operations and Liquefaction & Transport Storage technology maintenance intermediate storage • Technology • Client selects • Client selects • Client selects • Clients selects • Client selects licensed out independent independent independent independent indepen
Slide 36: Where Capsol is today
Where Capsol is today Key milestones Contracts Backlog M tonnes CO2/year1 2003 2008 2016 2022 CapsolGo® • One unit operating for German energy demonstration 0.9 company, also testing liquefaction units • Second unit en route for 5-month Commercialization: first commercial campaign for EEW EfW plant
Slide 37: First licensing revenue from pioneering project in 2024
First licensing revenue from pioneering project in 2024 Selected as the preferred solution for Europe’s first large-scale negative emissions plant First technology licensing agreement with Stockholm Exergi Awarded in July 2022 Proven technology Competition with all mature technologies HPC Safety of
Slide 38: Cooperating with industry leaders to accelerate growth
Cooperating with industry leaders to accelerate growth Value enhancement Sales and marketing Plant delivery Cooperating with engineering and Working with key suppliers to reduce Partnering with global leaders to Ambition carbon capture cost capture market share construction partners for efficient de
Slide 39: Eickmeyer & Sumitomo partnership
Eickmeyer & Sumitomo partnership Increasing capacity Developing and delivering CO2 capture plants Eickmeyer providing process design and engineering services for Developing and delivering standardized carbon capture plants for Energy-from- carbon capture plants utilizing hot potassium carbonate (HPC
Slide 40: Hitachi collaboration & Siemens Energy partnership
Hitachi collaboration & Siemens Energy partnership Carbon capture initiative Preferred supplier MoU to collaborate on initiatives to implement Capsol’s Hot Potassium Non-exclusive MoU Carbonate carbon capture technology on Energy-from-Waste (EfW) plants Siemens Energy to be a preferred equipment sup
Slide 41: Approaching value inflection point for CCS
Approaching value inflection point for CCS Market drivers making carbon capture increasingly attractive Market drivers Carbon capture incentives vs. cost Illustrative CO2 capturing incentives are expected to increase globally1 EUR per tonne CO2 captured All-in capture costs are expected to decrease
Slide 42: Incentives making CCS projects viable in key markets
Incentives making CCS projects viable in key markets North America at the forefront Emissions covered in key markets EU ETS prices2 USD/t CO2 emissions covered (Mt) Carbon incentive price (USD/t) 140 130 2 4001 120 100 99 85 88 87 85 80 80 1 600 60 At USD 80 per ton, several projects are economicall
Slide 43: Proven traction in BECCS
Proven traction in BECCS Stockholm Exergi, Sweden Biomass plant, Sweden United States Germany 800 000 ~170 000 ~100 000 ~200 000 tonnes of CO2 per year tonnes of CO2 per year tonnes of CO2 per year tonnes of CO2 per year (full-scale deployment) (full-scale deployment) (full-scale deployment) (full-s
Slide 44: Proven traction in Waste-to-Energy
Proven traction in Waste-to-Energy New projects, solid execution and key partners KVA Linth, Öresundskraft Central Europe Westenergy, Germany EEW, Germany Switzerland AB, Sweden Finland ~100 000 ~200 000 ~200 000 ~200 000 ~200 000 ~280 000 tonnes of CO2 per tonnes of CO2 per tonnes of CO2 per tonnes
Slide 45: Commercialising solution for gas turbines
Commercialising solution for gas turbines Global approach Partnerships Selected projects Technical maturity Being to developed to bring technology to market Active on sales and marketing Developing and maturing technology
Slide 46: Capital light, low risk and high-margin licensing model
Capital light, low risk and high-margin licensing model Capsol is offering a highly scalable licensing model Currently three income streams ‒ Paid engineering/process design ‒ Revenues from demonstration units ‒ Licensing fees No project construction risk Mean and lean organisation – marketing power
Slide 47: Illustrative revenue potential towards 2040
Illustrative revenue potential towards 2040 2023-2030 +4,200 2031-2040 Capacity mtpa Based on Rystad Energy estimates ~1 000 mtpa sanctioned ~5 200 mtpa sanctioned X License fee EUR 7-12 per ton = Market size EUR 7-12 bn EUR 29-50 bn From Technology licensing only (1,000 mtpa x EUR 7-12/t) (4,200 mt
Slide 48: Management
Management Jan Kielland, Chief Executive Officer Cato Christiansen, Chief Technology Officer >40 years experience with management and board positions in Former Shell, SPT Group and the Norwegian Ministry of the energy sector internationally. MSc in Petroleum Engineering Petroleum and Energy (Carbon
Slide 49: Board of directors
Board of directors Endre Ording Sund Einar Chr. Lange Wayne G. Thomson Chair Board member Board member • >40 yrs experience with mgmt. and • Largest investor in CO2 Capsol • Extensive international career as a top board positions in the energy, banking • Mgmt. experience from shipping and executive
Slide 50: Patent portfolio overview
Patent portfolio overview Patent family 1: Patent family 2: Patent family 3: Patent family 4: Patent family 5: Low emission Combined storage Method and plant for Thermal power plant Purification of flue thermal powerplant solution for natural transport of rich gas with CO2 gas from marine gas and CO
Slide 51: Risks and mitigating actions
Risks and mitigating actions Key risk factors Mitigating actions • Licensing model highly scalable with limited resources • Partnering with large global players to greatly extend reach, capacity and capabilities Small player • A clear strategic roadmap for organic growth and opportunistic approach t