RE:Time to average down Why ?Pyrogenesis’ plasma torches for induration in iron pelletization plants are not a ‘proof of concept’ torch nor are they ‘untested’. They have a patent for these high-power torches and have thoroughly developed in-house their torches for use in replacing industrial burners, with support from the Canadian National Research Council. They’ve also physically tested the torches, both in-house, and also later in the RISE facility who was their first client.
All the electrical considerations have already been dealt with both in theory in the torch design specifications, and in practice with their work with RISE. With RISE, Pyrogenesis has already proven a clear understanding of what is needed for their torch to operate. With regards to new Clients A/B/C they are surely aware of what steps are needed to prepare their facility for the torches as all considerations and requirements would be thoroughly discussed early in the process of torch supply discussions or even before then.
As to availability of electricity supply, I don’t see a problem as all of the requirements would have been initially conferred to the clients, who clearly have the required supply or else they would not still be in discussions… I recall seeing somewhere that Peter mentioned these clients all have access to cheap hydroelectricity.
In the RISE contract, they would have done the same type of plasma torch modeling as a 1
st step, the intent being to ensure the torch has no negative effect on the induration process or on the furnace itself (by the way Peter has mentioned that it is not a necessity to do this for these new Clients but I believe they are in order to reassure clients who may have difference furnaces that their torches are perfectly compatible) which was likely followed by optimization of the torches. The torches’ adherence to client specifications were then demonstrated to RISE in person during the Factory Acceptance Testing (“FAT”) at Pyrogenesis’ facility in Montreal. installation on site. The following is from the 09/08/2019 NR:
“This FAT was held at PyroGenesis’ manufacturing facility where the Client evaluated the equipment during, and after, the assembly process by verifying that the torch was manufactured and operated in accordance with design specifications. After successful testing, the torch was shipped to Sweden” After installation, they still had to do Site Acceptance Testing at the client’s facility and oversee the installation of the torch. From the 10/17/2019 NR:
“Following the success of the Factory Acceptance Test last month, PyroGenesis’ team performed the SAT of the high-power plasma torch at the Client’s facility in Sweden where the torch has been installed and operated under the Client’s parameters. After this successful SAT, the torch has been installed on the Client’s reactor, upon which a series of tests will be conducted within two (2) weeks.” Finally, the series of tests were conducted and RISE was satisfied with the torches’ performance (the following is from 03/04/2020 NR):
“Following the success of the SAT (Site Acceptance Test) of the high-power plasma torch at the Client’s facility in Sweden, a series of additional torch tests were performed at the client’s site. As announced, these tests have concluded successfully.” Further down in this NR:
“Our success with RISE has demonstrated to the industrial manufacturing sector that our Plasma Torches represent an opportunity to significantly cut GHG emissions through a simple bolt-on replacement of their current fossil fuel burners,” said Mr. P. Peter Pascali, President and CEO of PyroGenesis. “Given how compelling our torch offering is, particularly in light of the environmental pressure the industry is under (only recently a new trend has emerged where financial institutions are tying credit facilities and debt issuances to carbon reduction targets for multi-national industrial and mining conglomerates) we expect the demand for our torches to grow exponentially.” Trying to make it sound as if any of this is unproven is unjustified. The reason there is so much interest in their torches, particularly for replacing burners in iron ore pelletization but also in general for heavy industry, is because RISE in Sweden thoroughly tested them and the results were excellent. Word spreads, especially when the client (RISE) is at the forefront of research and innovation on the reduction of GHGs in industrial processes.
ElanS2 wrote: This is, without a doubt, an opportunity to invest in a firm with a fantastic future ahead of it. However IMHO the market is running a little too fast.
from the April NR :
"it has successfully completed the first phase (the “First Phase”) of a multi-phase modeling contract aimed at evaluating the performance of PyroGenesis’ proprietary torches in an existing iron ore industrial furnace with the goal of replacing all existing fossil fuel burners with PyroGenesis’ plasma torches."
A modeling contract is not a physical, on-site operational demonstration of this new application of a high power plasma torch. The NR also states:
"This all important First Phase demonstrated that replacing fossil fuel burners with PyroGenesis’ proprietary plasma torch (i) has absolutely no ancillary detrimental effects anywhere in the process or with the furnaces, (ii) results in significant greenhouse gas reduction while at the same time, (iii) projecting significant cost savings."
The next phase/objective will be to prove the above on-site under real operating conditions. Engineers have been known to make mistakes and misculations due to bad assumptions and "unkowns". The life of a torch under operating conditions could vary from the assumptions. It may be necessary to revise the materials used to build the torch and maximise it's life. These things are details, yes, but essential.
Building a proof of concept torch(s) will be the simple part as will be bolting it ( them) in place. Do not ignore the supply of electricity and all that that implies: is it available?, how far away?, switchgear, transformers, wiring to say the least. Wiring will be easy, not so for transfos and switchgear. That stuff can require many months to build and deliver after the project manager has accepted the design. Big stuff is made to measure and not on the shelf waiting for an order. It could very well be on the critical path to operation.
I am taking the time to average down as I am sure there will be more opportunities to watch the markets emotional response to future NRs
There will be many more phases before the need to demonstrate this tech is done with.
The market is known for over reacting. Fiture clients will not be making investment commitments on emotion. The clients will be putting their personal careers on the line when selling the job to owners. They will be conservative.
They will be replacing something that works with something that has no track record in their business. That could be personally dangerous.