PyroGenesis Canada Inc (CVE:PYR) (OTCMKTS:PYRNF) announced Wednesday it has completed successfully all torch tests for Rise Energy Technology Center AB and has received final payment from the Swedish company.
This Rise Energy contract, originally announced in January 2019, is for a 900-kilowatt plasma torch system, which was won in a competitive bid process.
PyroGenesis's 900-kilowatt plasma torch is used to replace fossil fuel burners in the iron ore induration (pelletization) process. Pelletization is the process in which iron ore is concentrated before shipment, thus significantly reducing the cost of transportation.
In conventional technology, the process heat is provided by fuel oil or natural gas burners. The combustion, in the burners, of fossil fuels results in the production of greenhouse gases, mainly carbon dioxide (CO2). Plasma torches, by the fact that they can convert renewable electricity to heat, offer an environmentally attractive alternative to fossil fuel burners.
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, and discussions are now taking place for follow on work and additional torch orders.
According to management, a typical pellet plant producing 10 million metric tonnes of pellets annually emits approximately one million metric tonnes of CO2. The total world pellet production of 400 million metric tonnes of pellets represents a potential market for torch sales in excess of $10 billion worldwide.
The world pellet industry generates about 40 million metric tonnes of CO2 every year. The use of plasma torches running off a clean electrical grid would reduce these emissions significantly. For reference, 40 million tonnes of CO2 represent the combined yearly emissions of 8.7 million US passenger vehicles.
As a result of this success, PyroGenesis said it has received numerous requests for proposals from potential clients in the field, and recently signed a small order from a multibillion-dollar international producer of iron pellets.
This order, the company said, is to model and evaluate the performance of PyroGenesis' torch in an existing industrial furnace. If successful, this would potentially lead to a multi-torch order aimed at replacing burners in their industrial pelletizing plant. An iron pelletizing furnace typically uses dozens of high-power burners (typically between 1-5 megawatts).
"Our success with Rise has demonstrated to the industrial manufacturing sector that our Plasma Torches represent an opportunity to significantly cut greenhouse gas (GHG) emissions through a simple bolt-on replacement of their current fossil fuel burners," said CEO P. Peter Pascali in a statement.
"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."
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