Velocys plc (VLS.L) announces that, by mutual consent of the parties, Shell International Petroleum Company Limited (“Shell”) has withdrawn from the Altalto Joint Development Agreement.
The Altalto project has no immediate funding calls and will continue according to its existing development plan. Velocys and British Airways plc (“British Airways”) will continue to work together in order to secure finance for the Altalto Immingham plant, and will continue the discussions with potential sources of finance for the project, which have been underway for several months and indicate strong interest in this sector. Velocys, British Airways and Shell are continuing to work with HM Government on policy development to support Sustainable Aviation Fuel (“SAF”) production in the UK.
Velocys and British Airways are grateful for Shell’s support during the initial stages of the Altalto project. As the project progresses, Velocys, British Airways and potentially other new partners will focus on the next stages. Preparations are underway to apply for significant government funding for the Immingham project. Whilst there is no guarantee that such an application would be successful, the Company believes that the project is well placed to achieve this.
Following the changes above, Shell will no longer have an option over shares in Altalto Limited, nor any rights or obligations in relation to the Altalto project. There is no direct financial impact on Altalto or Velocys as a result of these changes.
Henrik Wareborn, Velocys CEO, said:
“We are looking forward to moving Altalto Immingham to the next stage of development in 2021. Altalto Immingham is the most advanced commercial SAF project in the UK and is ready to take advantage of the strong push from both Government and industry for the decarbonisation of aviation, especially using waste feedstocks.”
Sean Doyle, British Airways CEO, said:
“Sustainable Aviation Fuel (SAF) is vital to the decarbonisation of aviation and to helping us achieve our net zero target. The formation of the Jet Zero Council and the recent launch of its Sustainable Aviation Fuels Delivery Group are testament to the importance that the Government attaches to SAF. We are excited to continue to work with Velocys, with the support of Government and other private-sector partners.”
Matthew Tipper, Shell VP New Fuels, said:
“Shell are pursuing multiple opportunities across our global portfolio. On this occasion, we have decided to focus our resources on other lower-carbon fuels opportunities which leverage our own technology. We will continue to work with the aviation industry and the UK Government, as part of the Jet Zero Council, to help decarbonise UK aviation. We wish Altalto every success in the future.”
– Ends –
Certain information contained in this announcement would have constituted inside information (as defined by Article 7 of Regulation (EU) No 596/2014) prior to its release as part of this announcement.
For further information, please contact:
Velocys
Henrik Wareborn, CEO
Andrew Morris, CFO
Lak Siriwardene, Head of Communications & Sustainability
+44 1865 800821
Panmure Gordon (UK) Limited (Nomad and Joint Broker)
Dan Norman (Corporate Broking)
Emma Earl (Corporate Finance)
John Prior (Corporate Finance)
+44 20 7886 2500
Shore Capital Stockbrokers Limited (Joint Broker)
Henry Willcocks (Corporate Broking)
Toby Gibbs (Corporate Advisory)
Sarah Mather (Corporate Advisory)
+44 20 7408 4090
Radnor Capital (Investor Relations)
Joshua Cryer
Iain Daly
+44 20 3897 1830
Field Consulting (General PR)
Robert Jeffery
+44 20 7096 7730
Notes to Editors
Velocys is an international UK-based sustainable fuels technology company. Velocys designed, developed and now licenses proprietary Fischer-Tropsch technology for the generation of clean, low carbon, synthetic drop-in aviation and road transport fuel from municipal solid waste and residual woody biomass.
Velocys is at present developing two reference projects: one in Natchez, Mississippi, USA (incorporating Carbon Capture, Utilisation and Storage) and one in Immingham, UK, to produce fuels that significantly reduce both greenhouse gas emissions and key exhaust pollutants for aviation and road transport. Originally a spin-out from Oxford University, in 2008 the company acquired a US company based on complementary technology developed at the Pacific Northwest National Laboratory. Velocys is headquartered in Oxford in the United Kingdom.
HRH The Prince of Wales has launched the Terra Carta – the Earth Charter – as the basis of a recovery plan that puts nature, people and planet at the heart of global value creation and aims to provide a roadmap to 2030 for businesses to move towards a sustainable future. The charter will serve as the guiding mandate for the Prince’s Sustainable Markets Initiative and seeks to put sustainability at the heart of the private sector.
In section 2, Redesigning Net Zero & Nature – Positive Transition, article 5, Game Changers and Barriers, the charter notes, “We need to identify, showcase and invest in the game-changing technologies and solutions that are emerging around the world”. Within this, “Sustainable Aviation Fuels” (SAF) are given as an example of “game-changing sustainable innovations and investments to be explored”.
SAF is also referenced in section 5, Reinvigorating Innovation, article 10, Catalyse Science, Technology and Innovation. “We must urgently invest in STEM, innovation and R&D at scale with a focus on sustainable solutions, alternatives and industries”, says the charter, “in support of game-changers (article 5, above) and in partnership with academic and research institutions, encouraging accelerated investment into STEM, Innovation and R&D” in areas including “Sustainable Aviation Fuels”.
In addition to explicit support for SAF, the charter also gives backing to supplementary measures supported by Velocys including, “Exploring the potential of Carbon Capture Use and Storage to reduce emissions and to help drawdown legacy carbon in the atmosphere”.
Launched at the One Planet summit in Paris, businesses including Heathrow have already given their support to the charter, which aims to raise £7bn to invest in nature by 2022 through the newly created Natural Capital Investment Alliance.
The Terra Carter can be read in full here.
Velocys plc (VLS.L) is pleased to announce the appointment of Panmure Gordon (UK) Limited as nominated adviser and joint corporate broker to the Company, and Shore Capital Stockbrokers Limited as joint corporate broker, both with immediate effect.
For further information, please contact:
Velocys
Henrik Wareborn, CEO
Andrew Morris, CFO
Lak Siriwardene, Head of Communications & Sustainability
+44 1865 800821
Panmure Gordon (UK) Limited (Nomad and Joint Broker)
Dan Norman (Corporate Broking)
Emma Earl (Corporate Finance)
John Prior (Corporate Finance)
+44 20 7886 2500
Shore Capital Stockbrokers Limited (Joint Broker)
Henry Willcocks (Corporate Broking)
Toby Gibbs (Corporate Advisory)
Sarah Mather (Corporate Advisory)
+44 20 7408 4090
Radnor Capital (Investor Relations)
Joshua Cryer
Iain Daly
+44 20 3897 1830
Field Consulting (General PR)
Robert Jeffery
+44 20 7096 7730
Notes to Editors
Velocys is an international UK-based sustainable fuels technology company. Velocys designed, developed and now licenses proprietary Fischer-Tropsch technology for the generation of clean, low carbon, synthetic drop-in aviation and road transport fuel from municipal solid waste and residual woody biomass plants currently in construction and development.
Velocys is at present developing two reference projects: one in Natchez, Mississippi, USA (incorporating Carbon Capture, Utilisation and Storage) and one in Immingham, UK, to produce fuels that significantly reduce both greenhouse gas emissions and key exhaust pollutants for aviation and road transport. Originally a spin-out from Oxford University, in 2008 the company acquired a US company based on complementary technology developed at the Pacific Northwest National Laboratory. Velocys is headquartered in Oxford in the United Kingdom.
In an op-ed feature in Biofuels International titled “Full Velocys-ity”, Dr Neville Hargreaves, Velocys’ VP Waste to Fuels, gives a timely update on the work the company is undertaking in the UK.
The piece notes the viability of Sustainable Aviation Fuels (SAF) as a route to decarbonisation of the aviation sector. He also describes the development of Velocys’ UK flagship project, Altalto Immingham. This planned plant will enable the production of ‘drop-in’ fuels that require no changes to aircraft or airport infrastructure and result in a 70% reduction in lifecycle carbon emissions.
The importance of the UK Government’s Jet Zero Council is also discussed. It has created a “shared sense of ambition” that is “hugely important and will inform both government policy and business strategy ahead.”
Dr Hargreaves concludes that “life-cycle net zero aviation is absolutely realistic and Velocys represents the here-and-now solution of making it a reality”. With increasing momentum from government and industry alike in their support for SAF as a means of achieving Net Zero, Velocys remains at the forefront of this fast-developing industry. Altalto is expected to be the UK and Europe’s first waste-to-jet-fuel facility.
The full article can be read here.
Velocys is pleased to announce the appointment of Helen Lillistone as the Group Financial Controller based in the Oxford office headquarters.
Helen was formerly Head of European Finance Operations for Shire plc, a UK FTSE 100 and US listed Biotech firm, where she was responsible for managing finance and accounting operations in Europe. Due to the dual listing, she has experience of both US and European financial reporting, accounting and taxation. Her expertise also includes integrating mergers and acquisitions, implementing financial systems and finance team transformation to shared services. Thus, bringing to Velocys wide ranging financial experience from a high growth global organisation.
She began her career at Crowe LLP, is a qualified chartered accountant and graduated from the University of Southampton with a BSc in Economics.
Andrew Morris, Velocys CFO, said:
“We are delighted Helen has joined Velocys and at a time when the company is progressing and developing significantly. Helen brings with her a wealth of knowledge and expertise, spanning a number of years including twenty of those at a UK FTSE 100 and US listed biotech firm. Therefore, she has an in-depth understanding of both UK and US financial systems and holds an extensive operational skill set at senior level.”
Velocys welcomes the newly published Ten Point Plan for a Green Industrial Revolution, which has confirmed UK Government support for Sustainable Aviation Fuels (SAF) as it seeks to “put the UK at the forefront of aviation technology to push forward low carbon travel.”
In its call to action, the Government has said this can be achieved “by taking immediate steps to drive the uptake of sustainable aviation fuels”, and the country should use its COP presidency as an opportunity to take a global lead in the development of a domestic SAF industry. SAF, says the publication, “is one of the key steps to success that we can unlock” in the decarbonisation of the sector.
Policy commitments contained within the document include a £15 million competition to support the production of SAF in the UK, building on the success of the Future, Fuels for Freight and Flight Competition, of which Velocys has been a beneficiary. Moreover, the Government announced its intention to consult on a SAF mandate to create a market-led demand for these innovative fuels. The increased commitment to carbon capture and storage is also important, since Velocys can use that in combination with the production of SAF to drive down emissions further.
Commenting on the Ten Point Plan, Henrik Wareborn, CEO of Velocys, said:
“We welcome the Government’s recognition of the essential role sustainable aviation fuels will play in decarbonising aviation, including the Prime Minister’s mention of synthetic fuels as part of his vision for a cleaner Britain.
“Altalto, our planned waste-to-jet-fuel facility in North East Lincolnshire, could be fuelling transatlantic flights in just five years’ time with no need to modify aircraft or engines at all – but we need the right Government support to make this happen, and as such the policy development announced in the Plan is an important step forward.
“Our technology, already demonstrated at commercial scale, forms part of an integrated solution which can cut lifecycle carbon emissions of aviation fuel by 70%. By incorporating Carbon Capture and Storage (CCS) technology, we can even enable the production of negative-carbon-emissions fuels, making the Government’s vision for a net zero flight across the Atlantic a reality this decade.”
A new report published by the World Economic Forum (WEF) in collaboration with McKinsey & Company has confirmed that Sustainable Aviation Fuel (SAF) presents the most viable, ‘here and now’, green technology available in the decarbonisation of aviation with synthetic fuels being made from sustainable feedstock.
The report, Sustainable Aviation Fuels as a Pathway to Net-Zero Aviation, has been produced as part of WEF’s Clean Skies for Tomorrow initiative. It confirms that “a transition to SAF is within reach”, with no changes to existing aircraft or airport infrastructure required, and enough sustainable feedstock available to fuel this shift. “SAF is the most achievable and most effective pathway to reduce aviation’s lifecycle emissions in the immediate future,” says the report.
As developers of the UK’s first waste-to-jet-fuel plant, Altalto Immingham, Velocys will be at the forefront of the roll out of SAF both nationally and internationally, fuelling the future of air travel.
Commenting on the publication, Henrik Wareborn, CEO of Velocys, said: “The World Economic Forum’s new report demonstrates there is a clear path for aviation to cut its emissions significantly through the use of Sustainable Aviation Fuel (SAF).
“Altalto, our planned facility in North East Lincolnshire, will be the first waste-to-jet-fuel facility of its kind in the UK, taking hundreds of thousands of tonnes of waste per year which would otherwise have gone to landfill or incineration to produce SAF that considerably reduces both greenhouse gas emissions and exhaust pollutants from commercial aviation.
“The report confirms that there is ample solid waste feedstock available at a global level to supply projects like ours, and shows that aviation can be provided with enough SAF to meet long-term decarbonisation goals without the use of food crops and without causing land use change.”
The full report can be found here.
Velocys was pleased to present to industry colleagues at the BioRenewable Deployment Consortium (BDC) and give an update on company projects which convert woody biomass to jet fuel in the United States.
Jeff McDaniel, Velocys’ Vice President New Projects, provided an appraisal of the flagship Bayou Fuels facility located in Mississippi, which will make sustainable aviation fuel (SAF) from woody biomass and renewable natural gas. Project updates included recent optimisation work which has identified an opportunity to utilise renewable natural gas as a co-feed that will materially increase production and returns, and reduce capex intensity.
He went on to outline the important role of carbon capture utilisation and storage (CCUS) at Bayou Fuels, which Velocys’ has partnered with industry leaders Oxy Low Carbon Ventures to implement and will result in the production of net negative carbon intensity fuels.
Updates were also given on recent successes in Velocys’ woody biomass to jet fuel technology being licensed and demonstrated at commercial scale internationally, including with Toyo Engineering in Japan and Redrock Biofuels in Oregon.
It is expected that Bayou Fuels will be producing fuel at commercial scale by the middle of the decade, and will be the first in a series of biorefineries developed by Velocys in North America.
A recent review from industry coalition Sustainable Aviation, of which Velocys is a member, has confirmed that the UK could be home to up to 14 sustainable aviation fuel (SAF) production facilities across the country.
As the UK’s first commercial waste-to-jet-fuel plant, Velocys’ planned Altalto facility is the most advanced, here-and-now example of green aviation technology. Sustainable Aviation’s research identifies Humberside, where Altalto will be located, as a key cluster for the development of this new domestic industry. The region could establish itself as the global hub for fuelling future air travel.
Across the UK, the 14 SAF production facilities would have the potential to generate an annual gross added value of £929m, creating 6,500 jobs and saving 3.6 million tonnes of CO2.
The research shows that it is possible to deliver on the Government’s Jet Zero ambition and transform aviation using readily available feedstocks with innovative technology and existing aircraft. The Altalto project on the Humber could fuel this transformation, cutting carbon emissions and creating jobs in the process.
To read Sustainable Aviation’s submission to the Comprehensive Spending Review in full, please see here.
As a member of the Clean Skies for Tomorrow (CST) initiative, a coalition of leading airlines, airports, manufacturers and fuel providers working together to find solutions to reach net zero emissions from global aviation by mid-century, Velocys has given its support to a new joint policy proposal from the group to accelerate the deployment of sustainable aviation fuels (SAF) in Europe.
European members of the CST have recommended the following package of policies to support the technological development and early deployment of SAF and drive up SAF demand:
Commenting on the publication, Henrik Wareborn, Velocys CEO, said:
“The analysis of the Clean Skies for Tomorrow initiative shows a robust, realistic path to net zero aviation, mainly through sustainable aviation fuels (SAF). Velocys’ Altalto Immingham waste-to-jet-fuel project, the first of its kind in the UK and Europe, offers a SAF supply solution that is ready now and an example for future projects. But this vital industry can only develop with the policy support advocated by the CST.”
To find out more about the Clean Skies for Tomorrow coalition and the report, please view:
https://www.weforum.org/projects/clean-skies-for-tomorrow-coalition