Business Line Developments Posted August 10. So by mid-November.
Business Line Developments
Upcoming milestones which are expected to confirm the validity of our strategies, are as follows:
Business Line Developments: Near Term (0 – 3 months)
(i) Financial
Payments for Outstanding Major Receivables: The Company remains in continuous discussions with Radian Oil and Gas Services Company regarding the outstanding receivable of approximately US$8.0 million under the Company’s existing $25 million+ Drosrite™ contract. As previously announced, PyroGenesis agreed to a strategic extension of the payment plan, by the customer and its end-customer, geared to better align the pressures on the end-user’s operating cash flows created by increased business opportunities.
These discussions are very positive, both in regards to the ongoing payment plan, and in regards to a potential substantial new order of additional Drosrite™ systems, as the client’s cash flow pressures and their new business opportunities move closer to resolution.
Innovation Grants: as mentioned in the Q1 outlook on May 15 the Company has applied for grants tailored to technology innovation and/or carbon reduction, and expects to have results regarding these applications. This situation has progressed very positively, and the Company is awaiting formal government announcement of the grants before it is legally allowed to indicate specifics.
(ii) Commodity Security & Optimization
Negotiations for Multiple Metal Powder Orders: Negotiations with companies for commercial orders of the Company’s metal powders continues, as projected within the Company’s Q1 outlook for Q2. As noted above, in Q2 the Company announced a first by-the-tonne contract for titanium metal powder of 5 metric tonnes, with an option for 6 additional tonnes.
Product Qualification Process for Global Aerospace Firm: Based on information flow between the Company and the aerospace client previously announced, the Company believes that the 2-year long qualification process to approve the Company’s titanium metal powers for use by a global aerospace firm and their suppliers, will conclude in the near term. This project continues to move forward positively.
(iii) Energy Transition & Emission Reduction
Plasma Torch Order: As mentioned in the Q1 outlook for Q2, on May 15, the Company was in advanced discussions with an international entity, whereby a plasma torch contract, if signed, would be between $3-$4 million. Post quarter end, on August 1, 2023, the Company received a signed contract for this project, for $4.1 million, with a confidential US-based aeronautics and defense client.
Iron Ore Pelletization Torch Trials: As mentioned in the Q1 outlook on May 15, in April 2023, the commissioning of the plasma torch systems, for use in Client B’s pelletization furnaces, was underway, with the Company’s engineers onsite at the Client’s iron ore facility. The commissioning process includes installation, start-up, and site acceptance testing (SAT). “Client B” is the customer to whom the Company previously announced that it had shipped four 1 MW plasma torch systems for use in Client B’s iron ore pelletization furnaces, for trials toward potentially replacing fossil-fuel burners with plasma torches in the Client’s furnaces.
This project continues to move forward. The Client recently suffered a series of unfortunate technical events that caused delays of several weeks, as a result of damaging regional torrential rain storms and flooding that caused significant impairment to the facility’s electrical system and furnace components. Repairs have been ongoing. The Company’s plasma torches have been installed and activated, and the final commissioning and site acceptance testing has resumed, with expectation for final SAT completion within the next few weeks or sooner.
Pyro Green-Gas: The Company’s wholly-owned subsidiary is expected to sign a contract with an approximate value of between $10-$15 million in connection with a renewable natural gas project.
Aluminum Remelting Furnaces: The Company has been working on the development of aluminum remelting furnace solutions using plasma, for use by secondary aluminum producers or any manufacturer of aluminum components that uses recycled or scrap aluminum.
With gas-fired furnaces responsible for much of the scope 1 emissions of secondary aluminum production, aluminum companies have been searching for solutions that can help in the decarbonization efforts of aluminum remelting and cast houses.
The Company has two concepts: the retro-fitting of plasma torches in existing remelting and cast house furnaces that currently use other forms of heating, such as natural gas; and the manufacturing and sale of a PyroGenesis produced furnace based off the Company’s existing Drosrite metal recovery furnace design, which has been in use commercially for several years.
The Company has been working with a number of different companies over the past few years towards these goals. The results from the conclusion of recent major tests, conducted in conjunction with these companies, have been very positive, and negotiations are underway for next step deployments and sales, with announcements forthcoming.