Velocys plc (VLS.L), the sustainable fuels company, is pleased to announce the Final Results for the Year ending 31 December 2019.
Velocys plc (VLS.L), the sustainable fuels technology company, announces that it has completed the manufacturing and delivery of four reactors to Red Rock Biofuels (RRB). RRB has a further option to purchase an additional two reactors by the end of 2020.
Henrik Wareborn, Velocys CEO, said:
“We are very pleased to have completed the reactor order for Red Rock’s facility in Oregon, USA, which will produce low carbon sustainable fuels from forestry waste. Our reactor supply chain has now been tested and has proven our capability to deliver our technology to our global clients.
“Velocys has the technology, demonstrated at commercial scale, to enable the production of sustainable fuels. This fuel is essential for the hard to decarbonise transportation sector and will help to meet net zero emissions as required by many Governments.”
For further information, please contact:
For further information, please contact:
Velocys
Henrik Wareborn, CEO
Andrew Morris, CFO
Lak Siriwardene, Head of Communications & Sustainability
+44 1865 800821
Numis Securities (Nomad and joint broker)
Stuart Skinner
+44 20 7260 1000
Canaccord Genuity (Joint broker)
Henry Fitzgerald-O’Connor
James Asensio
+44 20 7523 8000
Radnor Capital (Investor relations)
Joshua Cryer
Iain Daly
+44 20 3897 1830
Field Consulting (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.
Velocys spoke about the company’s sustainable fuels technology on BBC Radio 4’s news and current affairs programme, PM.
Dr Neville Hargreaves, VP Waste to Fuels, described the waste-to-jet-fuel process and stressed the ‘here and now’ status of our technology. The jet fuel produced would reduce carbon emissions by 70 percent, compared with conventional jet fuel , and that could be increased to 100 percent with the availability of carbon capture and storage in the UK.
In the programme, presenter Evan Davis suggested Velocys’ concept of using household waste to produce sustainable fuel was a ‘double win’. Chris Stark, Chief Executive at the Committee on Climate Change, said that given the difficulty of replacing fossil fuels in aviation, waste-to-jet-fuels represented a ‘sensible strategy’ for decarbonisation.
You can listen to the full programme on BBC Sounds. Velocys’ segment can be found at 17:39.
Velocys attended the inaugural meeting of the Government’s newly formed Jet Zero Council, of which the company has been confirmed as a member.
The Jet Zero Council will provide advice on the Government’s ambitions for clean aviation. A dynamic government and industry partnership, the Council will focus on developing UK capabilities to deliver net zero emission commercial flight through a series of measures including:
During the session, the Council was addressed by the Prime Minister, the Secretary of State for Transport and the Secretary of State for Business, Energy and Industrial Strategy.
The work of the Council will be essential to the ongoing development of Velocys’ planned waste-to-jet-fuel facility, Altalto Immingham, located in North East Lincolnshire.
Henrik Wareborn, CEO of Velocys, said:
“Velocys is very pleased to have been asked by the UK Government to join the Jet Zero Council. The first meeting of the Council could not have come at a more important time. As we return to the skies attention must focus on solutions that can deliver meaningful carbon savings not just by 2050, but within the decade.
“Sustainable aviation fuels will play a critical role in achieving the Government’s goal of demonstrating flight across the Atlantic without harming the environment within a generation. In fact, our planned waste-to-jet-fuel facility in Lincolnshire could be fuelling transatlantic flights in just five years’ time without the need to modify aircraft or engines at all. Velocys has the technology, already demonstrated at commercial scale, which cuts lifecycle carbon emissions by 70%. By incorporating carbon capture and storage technology, emissions could be cut further, enabling the facility and others that could follow to produce carbon-negative-emissions fuel by the end of the decade.”
Velocys has welcomed the publication of a letter to the Chancellor from a cross-party group of MPs, calling for the Government to enhance investment in aviation decarbonisation, whilst recognising synthetic fuels as the realistic practical solution to lower carbon emissions and meet net zero targets.
The letter, sponsored by Conservative MP Sir Graham Brady and Labour MP Catherine McKinnell and backed by parliamentarians from the Conservative, Labour, SNP, and Lib Dem benches, calls for Government to provide £500m in industry-matched funding for early stage sustainable aviation fuel facilities, increase funding for R&D of new cleaner aircraft, and accelerate the modernisation on UK airspace.
Reported in The Daily Telegraph, Velocys’ planned UK facility, Altalto, was referenced as an example of a flagship project that could benefit from such investment. Local MP, Martin Vickers, was quoted in the article as saying “with Velocys’ planned waste-to-jet fuel facility in my Cleethorpes constituency, having recently received planning permission, the area could become known for developing and exporting green aviation technology.”
Velocys has been featured in The Sunday Telegraph as an example of here and now sustainable aviation fuel (SAF) technology, which could catalyse the Government’s Jet Zero plans and target of green flights within a generation.
In the piece, ‘Johnson fires up the engines for a Jet Zero future’ (online version titled: ‘Can a green revolution really save Britain’s crisis-stricken aerospace industry?’), Velocys’ waste-to-jet-fuel process is discussed, along with the need for appropriate policy support, and the fact that our technology could enable commercial scale SAF production by the middle of the decade.
The Telegraph’s Industry Editor Alan Tovey writes, “Wareborn remains convinced sustainable fuels are the future of aviation with low-carbon flight likely to depend on biofuels.”
The piece concludes with Velocys’ CEO Henrik Wareborn commenting, “Burning oil is a bad thing. It needs to be left in the ground … Raising the capital to build the plants isn’t difficult if there is the policy support to decarbonise transport.”’
The full article can be read here.
£20m raised from Placing and Retail share offer
As announced on 24 March 2020, Velocys has responded well to the Covid-19 related lockdowns in the UK and the US, implementing procedures which have allowed the Company to operate close to “Business as usual” during this period. Progress has been made on all aspects of the business and all critical milestones have been met. Manufacturing of reactors for Red Rock Biofuels has progressed as per the agreed schedule and we anticipate being able to complete the delivery of all four reactors by the end of June 2020. The ongoing work on our reference projects and our customers’ projects is also on schedule. We have announced an extension of our JDA with British Airways and Shell as well as Planning Permission for the Altalto project in the UK during this period. We have received grants and subsidised Payroll Protection loans from the UK and US governments respectively in recognition of our continued commercial progress and absence of redundancies or furlough of any employees.
Due to the logistical difficulties involved in completing the audit while operating under lockdown restrictions, the Company believes that it will not be possible to complete the annual audit in time for an Annual General Meeting and presentation of the Annual Report and Accounts prior to 30 June 2020. The London Stock Exchange and the Registrar of Companies have approved a delay to the filing and publication of the Company’s audited annual accounts for the financial year ended 31 December 2019 and the holding of its 2020 AGM by three months in line with current broad industry practice due to the restrictions imposed by the Covid-19 pandemic. The Company confirms that it now expects to release the Annual Report and audited accounts during early August 2020.
Given this delay, the Company is today providing shareholders with an unaudited update on trading for the year ended 31 December 2019, details of which are set out below.
Headline Financial Results for year ended 31 December 2019 (Unaudited)
Today, Velocys is delivering the technology to provide the next generation of sustainable fuels for difficult to decarbonise sectors, particularly for aviation and heavy goods transport. Our technology converts biogenic sustainable waste materials, to cut net greenhouse gas emissions and improve air quality.
Combining transformative technology, operational expertise and a partnership approach, we are enabling commercial biorefinery projects, today, that will deliver the sustainable fuels required that will allow our clients to advance towards their net zero objectives.
Our technology can reduce the impact aviation has on the climate – the toughest area of transport to decarbonise – by delivering aviation fuel with a low or even carbon-negative footprint.
Velocys’ commercial strategy and future revenue generation is derived in three ways:
1) The sale of engineering services, FT reactors, catalysts and FT technology licences to commercial customers;
2) The limited initiation, design and development of joint venture biorefineries and sale of related engineering and technology services to the two Reference Projects.
3) The sale of integrated technology packages for end to end solid waste biomass to liquid synthetic fuels earning revenues from engineering, technology hardware including the FT reactors and catalysts and from technology licenses and decarbonisation royalties.
Commercial
Red Rock Biofuels, Oregon biorefinery (“RRB”)
This wood chips to sustainable fuel biorefinery commenced construction during 2018. During 2019 we reached agreement on a series of amendments in our licensing contracts with RRB, seeing the delivery of the first of four reactors and the first four charges of catalyst, reducing the commitment for reactors from six to four. Manufacturing the reactors and catalyst for this £9.2m order was commenced in 2019. During the year we invoiced £1.2m for the delivery of one reactor and four loads of catalyst and have £5.6m deferred revenue awaiting the completion of the delivery of the three remaining reactors, which will be completed in June 2020 and the commissioning of the FT process once the customer’s plant is fully constructed later this year.
Toyo Engineering Corporation
During 2019 we secured a purchase order and technical service agreement with Toyo Engineering Corporation (Toyo) for the use of Velocys technology in a publicly funded demonstration facility in Nagoya, Japan, as well as an advance deposit for the use of the Velocys technology by Toyo in a subsequent commercial plant.
The Toyo order with Velocys, worth approximately £0.4 million is for the supply of Velocys’ FT technology, equipment and catalyst for a biomass-to-jet fuel demonstration facility currently under construction by a consortium of Japanese companies.
In addition, Velocys has agreed that it will grant an exclusive right for Toyo to secure and use the license and technical services of the Velocys FT technology for a future potential commercial plant in Japan with an advance deposit of £3.2 million. The deposit was paid in a non-refundable tranche of $0.5 million (£0.4 million) and a further tranche which is potentially refundable and subject to milestones.
Our Reference Projects
Henrik Wareborn, CEO of Velocys, observed:
“Velocys is now within reach of being able to offer a tangible solution to support decarbonisation of air travel; a critical sector supporting the global economy with very stringent fuel criteria and few alternatives to hydrocarbon fuels. The aviation sector needs renewable fuels which meet the complex standards of fossil fuels for engine safety and performance reasons. I believe Velocys is well positioned to create significant shareholder value from our unique position at the cutting edge of sustainable aviation.
“Velocys has entered into an exciting period of its commercial development as we are progressing with the Altalto Immingham Project with our partners British Airways and Shell, having appointed Worley as our engineering contractor for the FEED stage. We announced a groundbreaking development in our Mississippi Biorefinery Project with its Carbon Capture and Storage contract with Oxy Low Carbon Ventures, which means that the fuel produced from this plant will have a negative carbon intensity. We expect negative carbon intensity to be required for competitive sustainable fuels in the future to assist our clients to progress towards their “net zero” objectives.
“Whilst developing these two reference projects for our technology we have reached agreement with our technology partners to work with us to bring their technologies into our integrated package solution providing a standardised conversion process from solid waste feedstocks to liquid synthetic fuels, which burn cleaner than conventional fuels and have low or negative Carbon Intensity.”
For further information, please contact:
Velocys
Henrik Wareborn, CEO
Andrew Morris, CFO
Lak Siriwardene, Head of Communications & Sustainability
+44 1865 800821
Numis Securities (Nomad and joint broker)
Stuart Skinner
Emily Morris
Alamgir Ahmed
+44 20 7260 1000
Canaccord Genuity (Joint broker)
Henry Fitzgerald-O’Connor
James Asensio
+44 20 7523 8000
Radnor Capital (Investor relations)
Joshua Cryer
Iain Daly
+44 20 3897 1830
Field Consulting (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 licences proprietary Fischer-Tropsch technology for the generation of clean, low carbon, synthetic drop-in aviation and transport fuel from municipal solid waste and waste woody biomass.
Velocys is currently developing projects in Natchez, Mississippi, USA (incorporating Carbon Capture Use and Storage) and 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.
Velocys plc (VLS.L), the sustainable fuels technology company, is pleased to announce that it has secured a further £0.5m of grant funding for the Altalto waste-to-fuels project from the Department for Transport (DfT), under the Future Fuels for Flight and Freight Competition (F4C).
The proposed Altalto Immingham plant is planned to convert hundreds of thousands of tonnes per year of residual waste into sustainable fuels, mainly aviation fuel.
Velocys was awarded a grant of £0.4m in Stage One of the F4C in 2018, and was shortlisted to receive an award in Stage Two. The DfT has now made £0.5m of the Stage Two grant available to Velocys. Velocys is one of the two remaining companies expected to receive the balance of funding in Stage Two, subject to completion of future project milestones.
Henrik Wareborn, Velocys CEO, said:
“We are very pleased to have the continued support of the Department for Transport for this project. The Altalto project is a key step towards a substantial supply of Sustainable Aviation Fuel in the UK, which is essential for meeting net zero carbon targets. This grant, particularly at the present time, underlines the importance of our project to the Government’s plans for a green recovery.”
For further information, please contact:
Velocys
Henrik Wareborn, CEO
Andrew Morris, CFO
Lak Siriwardene, Head of Communications & Sustainability
+44 1865 800821
Numis Securities (Nomad and joint broker)
Stuart Skinner
Emily Morris
Alamgir Ahmed
+44 20 7260 1000
Canaccord Genuity (Joint broker)
Henry Fitzgerald-O’Connor
James Asensio
+44 20 7523 8000
Radnor Capital (Investor relations)
Joshua Cryer
Iain Daly
+44 20 3897 1830
Field Consulting (PR)
Robert Jeffery
+44 20 7096 7730
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.
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 currently 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.
Velocys plc (VLS.L), the sustainable fuels technology company, is pleased to announce that a formal notice of the decision to grant planning permission for the Altalto Immingham plant has now been issued by North East Lincolnshire Council. This is further to the resolution of the Planning Committee which was announced on 20th May 2020.
For further information, please contact:
Velocys
Henrik Wareborn, CEO
Andrew Morris, CFO
Lak Siriwardene, Head of Communications & Sustainability
+44 1865 800821
Numis Securities (Nomad and joint broker)
Stuart Skinner
Emily Morris
Alamgir Ahmed
+44 20 7260 1000
Canaccord Genuity (Joint broker)
Henry Fitzgerald-O’Connor
James Asensio
+44 20 7523 8000
Radnor Capital (Investor relations)
Joshua Cryer
Iain Daly
+44 20 3897 1830
Field Consulting (PR)
Robert Jeffery
+44 20 7096 7730
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.
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 waste woody biomass.
Velocys is currently 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.