Atome (LSE:ATOM) — Atome Energy PLC Investor Presentation

0:00 Good afternoon and welcome to the ATOM Energy PLC Investor Presentation. Your screen. Simply type in your question and press send. The company may not be in a position to answer every question that sees you in the meeting itself, have them come and view all questions submitted today and publish responses where it is appropriate to do so. Before we begin, I'd like to submit the following poll.

0:26 And I'd now like to hand over to Chairman, Peter Levine. Good morning to you guys. Hello. Good day. Good day, everyone, and thank you for joining us. In such numbers, we're very flattered and honored that so many people have joined this investor meet. ATOM, as you know, is the first dedicated green hydrogen ammonia producer, which has come to the London market. We actually came to London market at the end of December with a successful placing. We have two significant projects on board at this moment in time, so first two, both of which are moving forward expeditiously, and we're expecting material progress and advances this year. We've got a very strong shareholder base, which supports the company in various ways.

1:13 There's Trafigura, one of the world's leading commodity and logistics companies. There's Schroders, there's myself and there's present energy providing engineering expertise. Now as you all know, ladies and gentlemen, there's lots of talk about hydrogen and even hype. But our philosophy at ATOM is action, not words. And concentration not just on production, but also the end market combined with vertical integration. We're very excited about its prospects and therefore we're very pleased to have this opportunity, the first dedicated opportunity to discuss with our investors and of our progress, of our objects and ambitions and to take any questions that you've got.

1:59 So without further ado, I'm going to pass on to Olivier Moussat, our Chief Executive Officer. We have a very strong Board, which Olivier will present to you. And I am very grateful for your attention in the foregoing presentation. Thank you very much. Olivier, over to you. Thank you very much, Peter, for your kind introduction.

2:24 So as you rightly say, right, we are the first public company dedicated on the production of hydrogen and and why this is important. Up until today, you saw a number of companies going public around the technology, really making electrolyzers cheaper, ensuring that the cost of producing hydrogen will become cheaper. But there hasn't been a real focus on the production side. If we want to reach net zero, we really have to make sure that the product is available as the demand is going to grow exponentially. Quick example, over the past five years, demand for hydrogen has quadrupled. So, know, we need to ensure that hydrogen is available to the market and hence us focusing on the production. We need to make sure that that production finds a market. It has to be cheaper than the alternatives.

3:13 And today, because of a high cost of gas and coal, it can now be cheaper in the right environment to produce hydrogen than it can be actually to go and and fill up your car with diesel. But it has to be in the right environment, and the right environment is when you have very low cost of power available twenty four four seven, which is where our two foundational projects are in Paraguay in Iceland. Thanks to that and that strategy, you know, we were able to attract, an a number of important shareholders, as Peter has mentioned earlier. Clearly, you know, Trafigura possibly front and center because Trafigura is already one of the leading traders in the world both for ammonia and hydrogen. We also benefit from the support of our foundation incubator shareholder, President Energy, which has the engineering capacity for house to for us to grow and to accelerate that growth.

4:10 During the listing process, we were recognized by the London Stock Exchange for our work on ensuring we are greening the economy, hence them awarding us the LSE green mark. And as a final point of at the glance, you know, the management team and the the board composition is also extremely important, and I will get into that in a a couple of slides. So what is our business model? I think the reality is we want to build a platform to be able to incubate and grow production production of green hydrogen and green ammonia globally. Again, Paraguay and Iceland are the foundation. Production is the foundation, but we will also work vertically in ensuring that we can create the market, make the hydrogen available on the transport side, on the agricultural side. We have a strategy to go fast to market.

5:03 Today, you know, the largest electrolyzers in operations today are below 20 megawatt. We need to get into the gigawatts to make sure that we follow the demand. But to in order to produce fast, because the opportunity is now fast, is you need to have scalable, reasonably sized projects to be able for us to reach first first hydrogen by early twenty twenty four. And from these projects, we will grow. Our view from the technological side, as I said, there's a lot of progress made on the technology. There is also a lot of cost coming down is we need to make sure that we are always using the best technology at the cheapest cost at the point of FID. And that ensures a couple of things. What number one is that we are always at the best point in the cost curve.

5:50 You know? It is going to be competitive. We've seen experiences, let's say, in the solar sector when solar panels costs have come down dramatically to the point that you end up with stranded assets even in renewable energies. Our view is, you know, we are investing in the commodity of the future. And the and it's, you know like any commodity, you are always going to buy the cheapest available commodity. We'll always find the best market. Our view also is to make sure from a risk perspective, as we scale project up, we keep a very low cost base. You know? Again, we take we are very low cost on the input, but also we ensure that we have early cash flow to be able to pay for the next slide of growth.

6:40 Also, with, you know, hydrogen, we are producing ammonia. We are producing oxygen. We are also producing carbon credits. So you have a stream of revenue that you can maximize along the value chain. And the way we are going to design or we are designing our project, again, as fast minimizing cost is making sure that we are close to the power source so that we do not have transmission losses. Again, the input, which is electricity, is the most important. You need to have the most efficient source of electricity. So, again, close to the power source. Close to access to water. You know, we make ammonia and hydrogen with water. So you cannot have water, you know, tens or hundreds of kilometers away. It has to be water that you can actually use and filter in order, again, to reduce the costs and make sure that you can be the most efficient and close to infrastructure, whether it's ports, whether it's roads, whether it's a large offtaker, to ensure that all we are investing in today is really the production capacity and not the alternate infrastructure, which could increase the cost of a project.

7:45 It's also the reason why, you know, uniquely, at the moment is we are focused on buying existing power twenty four seven green power so that we don't have we do not have to develop the side of the power. And, obviously, finally, it's really ensuring that we are decarbonizing for hard to abate sectors. Shipping is increasingly important. In 2022, we will see a number of ships being converted to running on ammonia, running on hydrogen. So for us, this is really the big price as we grow our production. As far as how are we going to deliver it, I mean, clearly, it's, you know, like any company in a way, it's management management management. We benefit from the support of Peter Levine, who you just heard earlier, who has a long standing experience in delivering successful energy projects and also has a very industrial focus way of running companies and delivering these projects on time and on cost.

8:46 From my background, my most recent experience was nine years at the World Bank's IFC as chief chief investment officer, and my experience has been from electrons all the way to molecules. As as it when it comes to delivery, it's also very important to be on the ground and to understand the the challenges and ensure that you can deliver the projects, which is why we are very fortunate to have James Spaulding, who as CEO of president of ATOM Paraguay and director of the board of ATOM, who, you know, who was the general manager for Itaipu, which is the second largest hydroelectric dam in the world, who also was minister of finance in Paraguay and whose last duty was actually to work with the government on the decarbonization strategy of Paraguay.

9:35 From a sector specific expertise, we are also very fortunate that Mayrose Devada has, you know, joined us as an independent nonexec, and and she she was running she was essentially running the, an internal energy agency's hydrogen partnership unit. So and she was part of the, US DOE National Energy Laboratory. So, again, a lot of sexual experience, a lot of presence on the ground as well. And and finally, as CEO of our Icelandic subsidiary, Green Fuel, is, is Siggi. And SIGI's background is actually on the shipping industry. And as I said earlier, shipping is the natural off taker for the products we will be producing. So having a very good understanding of both Iceland and your primary market is key. And so these are the reasons, you know, why we are why we have built the management team and the board that we have in order to be able to deliver the projects in a fast track manner.

10:39 Let me go to the next slide. You know, very briefly on the ESG credential, as I mentioned earlier, we have been awarded the London green economy mark. And beyond, you know, just, let's say, nice words and the fact that we are working green on green energy, it's also a fill up an operating philosophy and a governance philosophy.

10:58 It's quite key for us that in the long term, we are doing the right thing at all times, not only from a global perspective, but also on the ground. A little bit of background around hydrogen and net zero. I think a lot of people have heard, and this is why you have a lot of investments in green energy today. You know, hydrogen is really, really key into ensuring that we are going to achieve net zero by 2050 because it is the molecule that can displace hydrocarbon molecule like oil, like gas the easiest. You know, we're talking a lot about electrification. I mean, it is great to be able to move towards electric cars. The reality is it has its limitations. So when it comes to heavy goods transport from shipping and possibly aviation, hydrogen and ammonia are really the key to change to to get to a green new future.

11:53 There's and to give you a sense of numbers as well is that we estimate that by 2050, but it's about 25% of the world's energy supply will be using green molecules. So it's you know, imagine, you know, today's oil oil consumption is around a 100,000,000 barrels a day. That's about 20,000,000 barrels a day of addressable market that we are going after. So we're talking extremely large quantities of of hydrogen, which needs to be produced over the next decades in order to be able to take that place to to to take that space and reduce the carbon emissions of the energy sector and our consumption. If I can pass it on to Myros to go a bit more into the details of the technology and the market.

12:42 Thank you, Olivier. Hydrogen is an energy carrier, and ammonia is a hydrogen carrier. Ammonia is the second most widely produced chemical in the world and it's made from hydrogen and the hydrogen is made from fossil fuel. In 2019, the total global production of ammonia was a 150,000,000 metric tons per year. About 70% of all the ammonia produced worldwide is used for fertilizers and agriculture. And land use accounts for 25% of global GHG emissions. So green alternatives are really important. The United Nations tells us that the population growth was supposed to go from 7,600,000,000 in this year up to 9,300,000,000 in 2050.

13:29 So we really do need green alternatives for this really truly global market. And green hydrogen will also help to decarbonize other key industries as Olivier has already said. Fertilizer, chemicals, refining, shipping, The international the Maritime Organization has a strategy going up to 2050, and it includes all of its sectors, shipping, fishing, ports, and barges. And you'll hear more about barges from Jim. So ammonia is a highly efficient energy vector, and this is because it has three times the energy density of hydrogen. So it can so it can encapsulate hydrogen at a smaller volume. And we're looking at a potential market of growth of 350,000,000 metric tons per year by 2050.

14:19 So the emissions and hydrogen. So emissions, at least sometimes they are hard to sort of get a handle on, but they're divided into three categories, direct, indirect, and everything else indirect. So how does that relate to how we're making hydrogen today and where ATOM is going? So today, most most hydrogen, as has been said, is made from fossil fuels. So you've got gray hydrogen, you know, it's and that's hydrogen without capturing any of the the emissions. So and then there's blue hydrogen, which captures 50 to 90% of the emissions, but it's today, it's more expensive than green hydrogen actually because of the cost of fossil fuel. Then we have another kind of hydrogen called turquoise hydrogen, which is made from pyrolysis, a high temperature method that uses thermal decomposition, and and this produces solid carbon. And so it's said to be emission free, but okay.

15:21 Then we have nuclear. Hydrogen made from nuclear, you can make massive amounts of it, and this is this is important. But the process of actually getting the the mining process for producing uranium, etcetera, is not emission free. And that leads us to green hydrogen. ATOM is going to produce green hydrogen from green electricity. It is gonna be carbon free and it is throughout its life cycle and it is going to be green across all of the of the emission categories, direct, indirect, and indirect life cycle. So production. If hydrogen is the foundation, the electrolyzer is the cornerstone of the value proposition. So the electrolysis of water powered by renewable energy produces green energy with with monetizable oxygen, a lot of oxygen, which is an increasingly valuable product as we all know since we are still in a in a pandemic.

16:19 So ammonia is made. Ammonia is actually made from water and from from which you extract hydrogen and air from which you extract nitrogen. So that's the formula that goes into the Haber Bosch process, the ammonia synthesis loop to actually make ammonia.

16:38 And so the electrolyzers that begin the process, their equipment at the front end, we have low temperature alkaline, the proven industrial model, eighty, a hundred years of experience, and we have the PEM, the polymer electrolyte membrane, again, a mature technology. And coming up the pipe, have solid elect solid oxide, electrolysis. And and this method is is going to perhaps be more efficient than other methods. And as the technology matures and the markets grow, costs are expected to come down. They've already been half 50% over the last five years, and, they're expected to again decrease by '20, by 2030, 2040, about 40%, and then ultimately by 80% by 2050. And so in addition, this is going to affect the the cost of hydrogen itself, which is is expected to go below US $2 a kilogram.

17:33 And so what does this mean for the future? Well, there's actually been a global global policy shift. And the size of the prize here is is is a $10,000,000,000,000 market for for our products. And it's also global sustainability for the world. And since so this has all taken place. I had a front row seat on this at the IEA. Over the last fifteen years, there was a we all the r and d work has been excellent. But in the last five, six years since COP fifteen, there has been a significant acceleration of development. So the the world is is I think convicted of the notion that we have to decarbonize. And the IEA's Future of Hydrogen report in 2019 codified this learning.

18:22 And effort was actually supported by the Japanese who are front and center on this effort yet today. And as of July of this past year, there were 43 countries now that are about that have or about to release hydrogen strategies. This this codifies the significant shift. And in addition, countries with hydrogen strategies have committed a $100,000,000,000 to the development of hydrogen. In Europe, we see that we see this at the EU level, and we see this in Germany. Germany has as president has just past president of the EU. They committed €8,000,000,000 to the process of bringing hydrogen up to up to the market, and France is expected to do so now as well during its presidency.

19:13 But but Europe is not the only part of the world where there is activity. There is activity in Latin America. Chile has made rapid progress, and neighboring countries are also developing hydrogen roadmaps. There is progress in Australia. There is there is progress in The United States. But today, ATOM working in Paraguay in Iceland, we are part of countries that have both contributed to the to the advancement of the hydrogen strategy. In Paraguay, they have released, Jim will tell you about that. And and in Iceland, the the road map is poised for adoption. And so with that, I'd like to turn it over to Jim to tell us about the Paraguay project. Jim?

20:03 K. Thank you very much, Olivier and Mary Rose. As Olivier mentioned at the beginning, I am director of ATOM Energy, but I'm also president of ATOM Paraguay. So we're the only green hydrogen project that actually has presence in country. I am currently in Assumption where we have our our office. And in that sense, the opportunity in Paraguay we consider is is very important. The fact that Paraguay has the second largest hydroelectric dam in the world, which is Itaipu, as was mentioned, and the the the the fact that Paraguay today is consuming about 30% of its half of Itaipu. We have other two hydroelectric jams dams, one with Argentina and one nationally owned.

20:51 So Paraguay is 100% green energy in the electric sector. And this is what enables a project such as to look at green hydrogen and green ammonia because of the competitive, stable, twenty four seven baseload energy that we have from from. And in that sense, as I mentioned, not only the fact that ATOM is located, ATOM Paraguay is in association, the fact that we have a proven track record through president and the investment, major investment done in in country over the past ten years really gives us the opportunity to have con concrete dialogues with the government and the private sector on on moving forward.

21:37 So I wanted to mention the on the opportunity to two two key areas. First of all, Paraguay is a very important agricultural producer. Paraguay is the fourth larger exporter of soybean in the world, for example. And this means that just in the year 2019, Paraguay imported almost $450,000,000 of fertilizer. And if we look at last year, this has increased tremendously given the fact that the volume is increasing every year every year. So as an apart there's an opportunity to substitute these imports with competitive pricing in country. And at the same time, Paraguay, as most of you must know, is a landlocked country where in South America bordered by Argentina, Brazil, and Bolivia.

22:30 And in that sense, the Paraguay and Parana Rivers are very important for our economy for commerce. So in the case of the Paraguay River, which we call the Idrovia, that is administered by five countries, by Argentina, Brazil, Bolivia, Paraguay, and Uruguay. And Paraguay has the third largest barge fleet in the world behind The US and China. The investment of this sector in Paraguay is almost 2% of our GDP, over $2,000,000,000, and the opportunities we have there are very important because considering the fact that Paraguay imports 100% of its fossil fuels. And the the impact that the international prices is having on their costs is not minor.

23:16 We're talking about over 30%. So for them to also change to stable priced fuel will be key for competitiveness moving towards the the future. So in the next slide, I'll pass on to 14. Excuse me. So if we look specifically on on the progress to date in Paraguay, as can be seen there in the map of South America, Paraguay is a landlocked country. Our project aims to develop inside that red try rectangle that we can see in the bottom photo. This is an area of 48 hectares that the technological arm of Itaipu, which is called the PTI, is earmarking for a low carbon economic development zone.

24:06 So in this area that will be administered by the PTI of Itaipu, they will be building a 500 megawatt substation. And if we look on the bottom right of that photo, you can just make out the the Itaipu Dam. So this means that we have, as was mentioned, very close proximity to the power source, which will also be very convenient in the in the moment of talking about pricing with a national power company because transmission losses will be basically zero. And all of this blue gray area that you can see in in that photo is the Itaipu Lake that feeds, the Itaipu Dam. But this is part of one of the most important rivers in the world, which is the Parana River. So, of course, access to fresh water from the Itaipu Lake and the Parana River will also be a key ingredient for the production of of hydrogen.

25:03 And at the same time, we can I mentioned that we've had very advanced discussion with off takers? I'll have the privilege of receiving our chairman, Peter Levine, next week in. And we have scheduled meetings with public officials and also with private off takers. We feel that we can have concrete news before the end of the month on on this issue, but we're working very well among others with with and their presence in Paraguay through Puma Puma Energy and also a barge company called Impala. So our next steps is is moving forward the power purchase agreement on November 4. We signed an MOU with Ande, which is a national power company.

25:50 Ande is a vertically integrated state owned company, so generation, transmission, and distribution depends on Ande, which will make our conversations easier. And in this sense, in in November, we've signed this MOU for a a power supply up to 250 megawatts. To give an example of what this means is about one third of one of the 10 turbines that Paraguay has available from Itaipu as as Itaipu has twenty twenty turbines. So this power is available today, which is a key enabler for the project. And the final slide I wanted to mention in the case of Paraguay is on the right box. You can see the phases. We're looking at a first phase of 50 megawatts, a second phase of 200 megawatts taking advantage of the declining capital cost as Olivier mentioned and the improvements in technology.

26:48 So in total, this this project looks at 250 megawatts where you can see the production of hydrogen, ammonia, and as Mary Rose mentioned, a very important subproduct, which is oxygen. We had a oxygen crisis such as many countries, I think, in the world, during our COVID, and this will be a very important guarantee also for industrial industrial use. So we're moving forward quickly.

27:15 As I mentioned, we're we're having conversations with the private sector. Also with the public sector, the vice ministry of energy, as Mary Rose mentioned, published last June, the green road map for for hydrogen production and consumption in Paraguay. And, it was great to see that ATOM's road map is perfectly aligned to what the Paraguayan government is committed to doing, within its, its conversations in COP twenty six that was the that was last year in November in in Glasgow. So Paraguay has committed to reducing 20% its cost of its fossil fuel consumption by 2030. And at the same time, it signed an agreement to electrify the transportation system and also the land transportation.

28:10 So I think we're we're in in in good alignment, as I mentioned, with the with the road map of Paraguay, and we're moving forward specifically on these different fronts. So thank you. So thank you very much, Jim, and I'll I'll I'll go I'll move to Iceland. And and, actually, I'll probably go a bit faster because there are a lot of similarities between Iceland and Paraguay. So Paraguay is a landlocked country. You know, Iceland, it's an island. Again, it's a locked country where where you have excess power, which has nowhere else to go. Right? So you have a a very limited market. And unlike what we are seeing, let's say, in Europe or in The UK where I mean, for a lot of you who are investors living in The UK, you have seen the price of energy rise significantly because it is essentially a spot market.

29:00 Where we are, it's you know, we want to become an industrial offtaker of that power, signing long term power purchase agreement at a fixed price over a long time, which ensures

29:10 that the projects that we do do not suffer from that volatility versus the output will also not be volatile. And governments are really focused on that because, you know, from an electoral point of view, of course, it's difficult. But from an energy security point of view, it's also extremely important. So the more choices of energy you can have, the better off you are into ensuring that the energy becomes remains available and affordable. As far as Iceland goes, you know, I mean, many of you know it's the greenest country in the world, but also it has, thanks to geothermal, and it's looking to decarbonize further its its production and its its, sorry, its industry. And one of the largest industry we're talking about, a multibillion dollar industry, is shipping and fishing.

29:57 And so when we had discussed and we we essentially took over the greenfield project in Iceland, we saw the potential to really address the maritime transport sector. You do also have the advantage that you are very close to the EU. And as Mayor Rose described earlier, you know, it is it is the most exciting market to offtake and to buy hydrogen, but especially green hydrogen, which which will benefit from, you know, essentially a premium, which is not quite quantified yet. But we are seeing a lot of a lot of discussions in the right direction and carbon credits that goes with it. So even though the main market for us in in in Iceland will be to grow the shipping market, we also have had discussions with the green energy partner in Bremen, the city of Groningen as well as a large European gas player to offtake to offtake hydrogen and ammonia.

30:51 The way we are going to go about it, it's on on a phase basis as well. So about 30 megawatts using alkaline to be online by early twenty twenty four. And then very shortly after that, a seventy seventy megawatt unit by 2025. There is potential to do more, but, again, we try to be reasonably sized with what we know with a focus that whoever produces first will get, the next, the next allocation of of power to produce.

31:24 There is a particularity, however, that I needed to point out. You know? As as you may see over here on phase two, we talk about electrolyzer technology. So alkaline, again, it's been the workhorse. It's very, very mature. There is no technological risk to it. But SOEC is quite interesting because as Mario was mentioned earlier, it is up to 30% more efficient than alkaline, which is why we've have had a very good discussion with haldotopso, which is one of the largest producer of electrolyzers in in that sector. On as far as, you know, where where we are, you know, we've signed the MOU with Landsverken, you know, the largest national power company for up to a 100 megawatt. We have signed agreements with. We are talking also with a number of of engineering firms to get to the front end engineering and design process.

32:17 And, also, we are discussing with a number of shipping, fishing companies in order to again, you know, we are focused on the production, but we're also very, very focused on the market.

32:31 As far as project economics, and that that works for both Iceland Paraguay, Again, it's all about, at the moment, the input price, which is the power price. And and the way we have identified it is avail excess available power, which is very cheap. We load we're talking about $30 a megawatt hour and below. Compare that to over 200 in The UK and on a long term basis. And and because, as we mentioned earlier, more than 90% more than 95% of hydrogen produced today is derived from either coal or gas, which have reached some of the highest price in the recent decades. You know, you're looking at competing against, you know, ammonia, which is now over a thousand dollars a ton, hydrogen at the pump in Germany, which is over €12 €12 a kilo, we can produce on the significantly

33:21 lower end of that, which is why we are going very fast with our projects. We've approving everything because, again, it's it's going to be a question of who can get to market first. And to give you a sense of of the the characteristic and the advantages of ammonia is if you look at the below, you know, you see that, you know, what is marine gas oil, what LNG, methanol, green ammonia. And up until about three years ago, everybody thought that LNG was going to be the fuel of the future for shipping. But, actually, it's looking very, very likely now that green ammonia and possibly even methanol will be will be overtaking and leapfrogging LNG.

33:59 And we're talking again of multibillion dollar addressable market. So we are really trying to make sure that we mix, that we match the input as well as the output, and we take a very project finance risk approach of derisking every single step of the way. As far as the targets, of how we have been going, well, you know, we had set told the market that we were going to IPO in 2021, and we did. Now we are essentially in the steps to get to final investment decision, which is, you know, why we raised the funds, why we went public, which is about, you know, finalizing power purchase agreement, getting into all of the feed study, you know, getting the suppliers of of electrolyzers,

34:45 and getting also to the market, which is again you know, I mean, we keep mentioning Trafigura, but they're also a very important player and a shareholder. So they're very aligned with us into ensuring we have the best market, but they're also not the only ones as we discussed earlier. Then we get to FID, and we get into construction in 2023 so that by 2024, we can get the first the first the first phase of production and then grow within our phases.

35:16 And on that, I think thank you very much for listening to us, and we'll be very happy to take on the questions. I mean, we have received a few questions. So That that's that's perfect. Thank you very much for your presentation, guys. Ladies and gentlemen, please continue to submit your questions using the q and a tab situated in the right hand corner of your screen. Just while I come and take a few moments for you those questions today, I'd like to remind you that a recording of this presentation along with a copy of the slides and a published Q and A could be accessed via your investor dashboard. As you can see, we received a number of questions today and thanks to all investors for submitting their questions. Could I please ask that you read a question and give a response where it is appropriate to do so? Thank you. Alright. No. Thank you thank you very much. I think I've had I'll start briefly.

36:03 You know, there is, maybe I'll I'll start with some of the technical questions. So, Myros, if if I can just direct them. So, one question from Shola is, you know, if the currently available electrolyzers are for maximum of 20 megawatt, you know, will you use multiple electrolyzers, if that is what is available at the time, of building a 50 megawatt plant or not? How are you going to go about it? Oh, thank you for the question. Well, we will go about it using the most advanced technology available to us at the moment. So so we haven't made a final decision yet, but but it is true that the largest existing project is 20 megawatts at the moment. And and how do we scale up? Is it basically modular? What what what are we Well, our hope is to scale up in a modular way. Yes. But we'll also take advantage of the the largest units that are available and take and also take into account

37:00 the footprint and how how all the equipment fits together. Thank you. I have another question, which is a tech question from Shola. I learned that hydrogen is difficult to store. How do you plan to deal with the storage of hydrogen postproduction but pre offtake? Again, I guess the answer to that question is in the most efficient way possible. So we will store it. So we don't have a final we don't have a final solution to that yet. So it will be compressed and perhaps liquefied, you know, cryogenic. But, initially, you know, in our first in our first phase, we're gonna be producing ammonia. So that's really the answer to the question. So most of the hydrogen that we produce initially will be going into the ammonia process. So we'll be storing mostly ammonia.

37:52 Well, there'll have to be some hydrogen buffer in there, of course, but we will we will be mostly storing ammonia. And and indeed, Shola, I think on on the way we are going to design, you know, we always we will always have the entire the entire value chain. So ensuring that whatever storage we have and whatever production we have has a market on the other side and has the correct buffer. As you may have seen and I'll just go back a couple of slides. We're talking about, you know, temperature at for liquid storage. You know, green ammonia is minus 34 degrees Celsius. You know, it is, you know, it is very easy to reach compared to, you know, what we are already doing on LNG. Right? I think there's there was a question in here on the financing stages. Right? So okay. Where and it's both from Chris H and and Michael D. So what are our thoughts about the cost of a project and how we would look to finance the project? So we are again, we are think we are designing the projects from day one from a very project finance perspective where we're going to derisk everything we can derisk so that we only have to focus on the, let's call it, the midstream aspect. So access to water will not be issued. We will not have to build roads. We will not have to be transmission lines.

39:03 So we will only focus again on the electrolyzers, on the compressors, on the storage. And and for these, the way we are going to go about it is essentially as we finance the project, it is going to be a mix of roughly 60% project finance, roughly 20% concessional funding, government funding grants, which are today available. I mean, Mayor Rose talked about over a $100,000,000,000 of support available for hydrogen and especially green hydrogen and about 20% of equity. The reality is the moment we hit FID, we will have crystallized the value of this project because we would have long term power supply, a known cost of development, and on the other side, an off taker to match it. So at this particular point in time, we go from, let's say, a very heavily discounted NPV value of what we could possibly do to a very certain multiple of EBITDA over the next ten to twenty years, which gives us three options at that particular point post FID. Number one, you know, we can come back to the market for that 20% of equity needed at, obviously, at a much higher valuation.

40:12 The most like other option number two, which is the most likely option, is you have a number of green infrastructure funds who want to come in at the project level and who were actually were set up to invest in green infrastructure projects. And we have already as part of the round when we were on the pre IPO trail, we had a number of these green funds who approached us already to try to understand our projects to get, let's call it, an early an an early view to to understand how we could fit their own investment plans. And, essentially, they would come in. We would, you know, farm in, welcome them as partners, and they would provide equity into the project. Option number three, because we would go from, let's say, talking about thirty, fifty megawatt projects to a line of sight on hundreds of megawatts, you have very large, you know, energy companies today which are actively looking all around the world for hydrogen projects which are scalable.

41:11 So I think it gives us quite a a wide, you know, a wide set of options to ensure that, you know, whichever option we choose is the best one, obviously, for, you know, for all of the shareholders and the management who are very, very closely aligned, but also for to develop these projects at growth. Let's see. So I think a question from James b that I will direct to Jim. So thanks for the presentation. Re Paraguay, whilst 250 megawatt is large in terms of existing renewable hydrogen project, it is a small fraction of what is forecast to be needed by 2030 and 2050.

41:57 What share of the Paraguay ammonia market do you hope to target, and what plans might you have to expand production? Okay. Thank you. Thank you, James, for your question. Thank you, Olivier. Well, what we're looking at at the moment, as you mentioned, 250 megawatts is actually a very large production facility. It's just it will be the sum of two phases, the 50 initially and the 200 polydun in phases of 100 each. And and we'll we'll be flexible according to how we see demand growing and and pricing. So so I think on the ammonia side, we see ammonia principally as a to a certain extent as a as a transitory product because, of course, the production will be finally hydrogen.

42:52 But ammonia is something that as Mary Rose mentioned today, is is domestically needed, and and and there's a high demand. So so we're looking at that in our final investment decision. I think before the end of the first semester, we'll have those fine tuned. But I would like to mention that we're in conversations with some of the most important traders, in the world, among those, So we feel very comfortable that given the the the first phase and then the second phase, as this transition continues and accelerates as was shown in the global policies policy shift, we feel that we'll be completely on track to guarantee 100% sales of of our production either locally or and as I I forgot to mention that the slide where I was showing the photo of where we we we would be located just across across the river on the East Side is Brazil.

43:55 And in the Brazil in Brazil so just on the right there, on the on the left is Paraguay. On the right is Brazil. So on that right side, which is 13 kilometers south from the main bridge that connects Paraguay and Brazil through Ciudadel Este, and a second bridge that it will be finalized by next year, we will have access tariff free as Paraguay is a founding member of Mercosur, of which Argentina, Brazil, Paraguay, and Uruguay form a trading block. So we have tariff free access for Paraguayan products to Brazil. And, as I mentioned, just across there, we have the states of Parana and Mato Grosso do Sul, which are huge agricultural, producers of Brazil. So so we're very comfortable in our strategy of of of of green ammonia production and possibly also looking eventually at urea.

44:57 Thank you. And and thanks, James. And and and if I may add, I think for us, the way we've designed the two fifty megawatt was indeed very focused on the addressable market today. A very space to grow and also to grow further towards the export markets, and it's it's going it's, you you know obviously, the hydrogen economy is going much faster than expected in a way. But we we actually even though Paraguay is landlocked, you know, being already one of the largest exporter of soybean in the world, there's a direct access to, to the international markets. And we have received incoming, which is, well, if we wanted to do more, could we do more? So, you know, are we exploring it? Absolutely. It's still a little bit early to tell because we are really focused on delivery. I mean, promises are great. Going into gigawatt projects is fantastic.

45:46 The reality is we have to remember where we are starting from, and we are starting, you know, in in in the tens of megawatt because this is what the technology allows us to do today, you know, on a very certain basis. Let me go. I'm probably gonna ask we probably have a couple of other questions. Maybe I'll send it that one back to you as well, Mayros, from Shola. It's, you know, will green hydrogen be priced higher than other types of hydrogen or not? Well, I guess if you're a betting man, we're gonna right now, of course, you know, we're we're competitive. But six months ago, we thought we were gonna have to explain why why hydrogen green hydrogen would command a premium.

46:34 So, I mean, all of the available evidence that we see is is that the cost of hydrogen is is going to come down and it will be competitive. It will be competitive on its own. In addition, there may be, you know, carbon credits that may that may facilitate here. But we are looking at, you know, a point in in the not too distant future where it will be competitive. It will be competitive with existing fossil resources. Part of the reason for this is that some of the supports for existing fossil resources will be will be withdrawn. So we are looking, I think, at a good future for green. No. Thank you, Marius. And indeed, what we have to remember that there is a lot of money going towards green, and the hydrocarbon sector is being start of capital.

47:23 So, unfortunately, you know, the cost of oil, the cost of gas is only going into one direction as, you know, as per the again, we that's why we had a slide on on the political shift, the policy shift that we are seeing. And, Shola, I mean, it's mean, you've been probably asking the most question. One question is how can you help educate potential investors as not many investors understand the story long term? So there there is a group called IRENA, I r e n a. So just if you want to Google it. And as the IEA, they have published a lot around the hydrogen market, the ammonia market. And and we had a question earlier around, you know, ammonia, are we going to produce hydrogen or ammonia? The reality is today, the significantly available market is and the best understood global commodity is ammonia, which is why we are really focused in ammonia. I mean, it's great to produce hydrogen, but if you don't have a market, it doesn't really mean much. Right? It's you you get no price for being first in that particular case. You have to make sure that you are producing something which has a market on the other side. As Jim intimated, you know, we are working, you know, intensively as well on the downstream side of the market to create the hydrogen market so that in time, we can help the decarbonization in transport, you know, in shipping, and and indeed, you know, grow the hydrogen economy itself. But, obviously, you know, ammonia is really it's a big price. And as as we saw, you know, prices of ammonia have tripled over the past three years.

48:53 And it's it is very important to address because it is a fertilizer, and it means that our food prices will only go one direction, which, again, you know, that needs to be addressed today. And I would also just like to add, Olivier, on the point of the global shift, the policy shift. I mean, this is this is captured. Is this measured in current in in in money? I mean, for years, the IEA really made a made a pitch to to shore up the research and development and demonstration in the renewable area. And now that's extended to hydrogen because of enormous amount of funding that comes from governments for fossil fuels. And this is now shifting. There is literally a capital flight at the government level, and those resources are being reallocated.

49:42 And so and we're gonna see that we're seeing that as well in capital markets. There's a question from Ishan. Oh, Isan, I'm sorry if I muddled your name. Is it correct to say that the critical component of the two project is the PPA that will allow ATOM to purchase idle capacity at competitive pricing and will also inform the pricing discussion with potential off takers. So the answer is yes. Right? 70% of the cost of production of hydrogen is of green hydrogen is related to the price of power. So stability, long term stable prices is key and indeed informs the potential disc the discussions with the offtaker because as an offtaker, whether you are a trading company, a shipping company, or trucking company, you are always looking for the cheapest available molecule.

50:31 So we we know there's a lot of public funding available, but what we are seeing today is we can work, you know, with green hydrogen, with green ammonia in without the need for subsidies, without the need for carbon credits, and that's what we are going after. So, clearly, if there are subsidies available, if there are carbon credits available, we will we will use them. We will take them for our numbers, but it's all about, you know, competitiveness. And today, again, you know, as the market is shifting very quickly and the investments is going very aggressively on the technology side, as we discussed. You know? PEM is the new key number block and is now being proven. You have a number of investments on AIM, you know, like ITM and others, which which are now, you know, proving that they can do the megawatts and above that essentially are making are making green hydrogen increasingly competitive and without as much volatility as we are seeing from the hydrocarbon based molecules.

51:26 So, you know, for us, it's all about you know, it's talking about, okay, what is the size of the price? What is the future? Well, essentially, you know, hydrogen and ammonia are the green commodity of the future, and we need to invest now because, you know, as one of the question that came earlier, you know, the demand for 2030 and 2050 is huge. And so we you know, this is why we are starting now, and this is why ATOM exists. And I think on that, we probably covered, you know, the large majority of the questions. That's perfect. I think you've addressed all those questions you can from investors today. And, course, the company review all questions submitted today. Before redirecting investors to provide you with their feedback, which I know is particularly important to the company, could I ask you for a few closing comments? So I think the closing comment, it's well, number one, you know, thank you for being there in numbers.

52:16 It's it's great to hear. I think it's great to hear that, you know, there's a number of investors who like or who want to understand the ATOM story better. And and, you know, we really appreciate your questions, which were, you know, very, very pointed and, you know, which basically show that, you know, it wasn't a short presentation, but it was ATOM's first official presentation. So we wanted to give you the best overview. And and we will continue to try to be as responsive as we can. You know, as you saw, there's a lot of update to come over the next few months. We will remain busy, and and we will update the market as often as we can whilst delivering the projects on the ground. Thank you for updating investors today. Is asking investors not to close this session as you now be automatically redirected for the opportunity to provide your feedback in order that the management team can better understand your views and expectations.

53:06 This will only take a few moments to complete, and I'm sure it will be greatly valued by the company. On behalf of the management team of ATOM Energy PLC, we'd like to thank you for attending today's presentation. Good afternoon to you all. Thank you.