We had a short call with QFUEL. Below is my summary:
- QFUEL has been working on remodeling all its lines so that all four lines could be all powered by gas generated in the chemical process. Until now only one line was running on self-produced gas, the other were run on electricity. That resulted in high energy costs. With the reactors powered by self produced gas, there will be substantial energy costs savings.
- QFUEL announced on Q2 call that the remodeling would take approximately two weeks and should be completed during September.
- QFUEL confirmed that Skive is in process of the upgrade and reconfirmed the completion within the September as guided.
- QFUEL also reconfirmed that during the Q3 Skive should be running on all four lines. Again this is very positive. Up to Skive was running on three lines. The running on all four lines will result in a greater efficiency of the production.
- Few weeks ago somebody posted in one of the QFUEL FB forums a Twitter post by QFUEL engineer that QFUEL is looking for electricity generators that can run on specialty gasses. That indicated, that QFUEL will be generating excess gas that they would use for electricity generation. QFUEL today reconfirmed that this is the case – QFUEL should generate more gas that they need to power their reactors. The surplus gas will be used for electricity generation. It is too early to quantify, but still a positive development.
- The company is also looking at creative ways to finance its capital expenditures. These may include a transaction at an individual project level – they could sell down part of their stake in a project to finance the whole operations. That has been announced before, just reconfirmed again. If that would be achieved, it would be very positive for the share price. QFUEL is working hard to achieve this.
- In summary, there should be several postivie announcements probably before the end of September:
- Announcement that Skive is back in operations powered by self generated gas
- Announcement the Fourth line is in operation – the full plant in full operation
- Announcement the company produces excess gas that is used for electricity production
Mintra announced another contract win. We are bullish on Mintra – see our previous posts on this high beta play on Shipping and Energy.
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