Eco Investor Update
A Weekly News Update for Environmental Investors
6 June 2011
- No 35
Sims Metal Management
Lynas has also received the US$250 million from the loan facility from the special purpose company formed by Sojitz Corporation and Japan Oil Gas and Metals Corporation, and the share placement to the special purpose company.
The US$250 million will be used to fund completion of Phase 2 of the Lynas Rare Earths Project. This will enable Lynas to increase planned production of rare earth oxides to 22,000 tonnes per annum. (ASX: LYC)
Ceramic Fuel Cells
The $100 million project is
Australia's largest smart grid project. Funded by the Australian Government,
the consortium includes CSIRO, IBM Australia, AGL, GE Energy, TransGrid,
The smart grid electricity network uses advanced communication, sensing and metering to more efficiently manages electricity supply and demand. The initiative is gathering information about the costs and benefits of smart grids to inform decisions by government, electricity providers, technology suppliers and consumers.
Ausgrid previous purchased a BlueGen unit for its Smart Home in the Sydney suburb of Newington. Installed in August 2010, the unit has generated 9,283 kilowatts of power and saved 10.4 tonnes of CO2 compared to power from the local grid.
Ausgrid has run the unit in a variety of modes, including constant power and modulating power, to match the typical load of a home. The BlueGen has been generating about twice as much electricity as the family has been using to run their household appliances and charge an electric vehicle. Excess electricity has been exported to the grid.
Ausgrid managing director George Maltabarow said "We're testing whether adding distributed generation like fuel cells can make the grid more efficient by flattening out peaks in electricity demand, as well as deliver benefits to households." (ASX: CFU)
The wholly owned Ponton Project is 200 kilometres east of Kalgoorlie and comprises a single Exploration Licence Application (E28/1317) covering 206 square kilometres. The report addresses environmental management practices as the Project is on a Class A nature reserve.
There is no guarantee the tenement application will be granted, said Galaxy.
Meanwhile, solid production at its Mt Cattlin spodumene project near Ravensthorpe in WA should enable the second shipment of spodumene to be shipped to China in mid June 2011, a month earlier than expected.
The volume of the shipment has increased to 17,000 tonnes from 12,000 tonnes previously, and The "MV Karine Bulker" has been booked.
Production totalled 12,778 tonnes of spodumene for April and May 2011, with May's production accounting for 7,185 tonnes. Managing director, Iggy Tan, said "We have reached a stage where the Mt Cattlin operation is established, stable and consistent. The whole operation is performing solidly. (ASX: GXY)
Clean TeQ Holdings
"The Kincumber project follows on from several smaller sized municipal odour control projects which we have won over the last two months. The award of this significant project, in conjunction with the other projects we have recently won, recognizes Clean TeQ as a leading supplier of odour control technology," said Chief Executive Officer, Peter Voigt.
"The past 12 months trading conditions have been very difficult for the Company but we have taken this time to consolidate and improve our offerings in the air, water and mining markets and we now look forward to an increase in the level of opportunities in the 2012 financial year," he said. (ASX: CLQ)
Zone Hardware markets and distributes branded home improvement products for do-it-yourselfers, mass merchants and specialty retailers. Its products include blinds, screen doors, the Hughie Sink water saving device, home fragrances using natural Australian oils, and decorative fences.
Recently established Riva Window Fashions offers custom made window furnishings. The new range is sold by Bunnings Warehouse with measure and installation services by authorized Riva representatives. The program has been launched in Melbourne metropolitan stores and will be rolled out nationally over coming months.
Gale Pacific's chief executive officer, Peter McDonald, said "The acquisition of Zone and Riva is a great fit for the business giving GAP an expanded presence in the broader pre-packaged and custom window shade markets, an expanded product offer and distribution channels to further grow the combined GAP, Zone and Riva businesses. We are excited about the opportunity to enter the custom made window treatment market in Australia and the national roll out of this program."
Zone and Riva generate combined annual revenues of $17 million. The acquisition cost of $13.5 million will be funded from existing banking facilities with $1.5 million of the purchase price taken by the vendors in Gale Pacific shares.
The acquisition will be earnings per share accretive in 2011-12 before any potential operational synergies.
Wayne Smart, part owner and director of Zone and Riva will join GAP in a senior management role to oversee their growth, particularly the roll out of the Riva custom window furnishings business. (ASX: GAP)
The deals will also increase Qube's indirect interests in the other businesses in the Automotive, Bulk and General Stevedoring division.
The main deal will see Qube acquire some operating businesses from Kawasaki (Australia) Pty Ltd in the Automotive, Bulk and General Stevedoring division as well as Kawasaki's shareholding in Minto Properties Pty Ltd.
Consideration is the issue of 72.7 million shares in Qube's proposed new holding company post the proposed restructure of Qube. Qube will also pay Kawasaki $14.82 million in cash, which is the outstanding balance of the shareholder loans Kawasaki has made to these businesses.
Qube has reached in-principle agreement with the remaining minority shareholders in each of the investment entities in the Automotive, Bulk and General Stevedoring division to acquire their interests. This should involve the issue of 3.4 million shares in the proposed new holding company.
The other terms for these and the Kawasaki deal are consistent with the agreement with Wilh.Wilhelmsen Holdings ASA in April 2011, including that 75 per cent of the shares be subject to a three year trading restriction.
The acquisition is subject to the proposed corporatization of Qube, internalization of its management, and other conditions. Completion is expected in August.
Sam Kaplan, managing director of Kaplan Funds Management, Qube's manager, said "The agreement with Kawasaki is another important step in transforming Qube into a major logistics operating company. We are pleased to have been able to increase Qube's control of, and ownership in, these quality logistics businesses and assets while still ensuring that the close and mutually beneficial relationship with Kawasaki is maintained."
The unit holder booklet for Qube's restructure will be lodged with ASIC very shortly. The corporatization, internalization and acquisition of the additional interests should be completed in late August.
In another deal, Qube said P&O Trans Australia (POTA) is to acquire Mackenzie Intermodal, a South Australian integrated logistics business, as well as some freehold land adjacent to the operations for future expansion. The transaction is subject to some conditions and is expected to be completed in July or August.
Qube owns 94.5 per cent of POTA through its Landside Logistics division. (ASX: QUB)
Viridis Clean Energy
This may be some comfort as unit holders ponder how securities that floated at $1 are now worthless. (ASX: VIR)
Micro Cap Companies
Nicholas Ong has joined the board as a non-executive director and company secretary. An MBA, Mr Ong was a principal adviser at the Australian Securities Exchange in Perth and has seven years experience in listing rules compliance and corporate governance.
He also replaces Keong Chan as company secretary. (ASX: AAQ)
The entire loan balances - principal plus accrued interest and fees - will be converted at 9 cents per share.
$1,190,006.38 is owed to Nichol Bay Holdings Pty Ltd, an entity controlled by Les Capelli; and $2,992,698.71 is owed to CF2 Pty Ltd atf The CF Trust, an entity controlled by Ian Campbell. Interest is 12 per cent per annum and will accrue until conversion.
The terms are unconditional except for shareholder and regulatory approval, with conversion expected before the end of July. (ASX: ANQ)
SPTS president and BluGlass non executive director, Bill Johnson, said "I'm very pleased with the quality of technology down-under, and SPTS is fortunate to be in a position to help commercialise it."
SPTS and Griffith University aim to develop and commercialize silicon carbide on silicon (SiC on Si) as a viable semiconductor material for LED, power and micro-electro-mechanical systems (MEMS) devices.
The partners said silicon carbide is an important substrate for growing the GaN films used to manufacture LEDs. The increased radiation hardness, mechanical strength and thermal properties of silicon carbide also make it a suitable replacement for silicon in MEMS devices for harsh environments.
Silicon carbide is also used to create semiconductor devices for high power, high frequency applications where its electrical properties are significantly superior to common silicon.
"Technology created by the research team at Queensland Microtechnology Facility at the Griffith University's Queensland Micro- and Nanotechnology Centre has demonstrated the ability to grow crystalline SiC directly onto low cost silicon wafers," they said.
Under the development agreement, SPTS will develop the thermal process and equipment expertise necessary to commercialize the technology. (ASX: BLG)
For shale gas, Eden holds a 50 per cent interest covering a prospective area of 806 square kilometres in south Wales. RPS reports that on seven Petroleum Exploration and Development Licences (PEDL) the volume of gas initially in place is 34.198 trillion cubic feet (TCF), with Eden's share 17.099 TCF. The recoverable gas is 12.799 TCF and Eden's share 6.349 TCF.
Eden holds interests in 10 coal bed methane PEDLs in south Wales. RISC reports that the estimated gross contingent resources is a 1C to 3C range of 687 to 1,363 billion cubic feet (BCF) with a 2C estimate of 980 BCF.
In total Eden holds interests in 17 coal bed methane PEDLs in South Wales, Kent and Bristol Somerset covering 1,068 square kilometres. RISC reports that the estimated gross unrisked prospective resource is a low to high estimate of 1,903 to 4,990 BCF with a best estimate of 3,088 BCF.
Eden says that UK natural gas demand in 2009 was 3.6 TCF, and the UK is a net importer of natural gas.
Eden will re-assess the best way to develop and exploit this potentially very significant asset, said executive chairman, Gregory Solomon. (ASX: EDE)
He will now assume the position of acting chief executive officer to enable Mr RE Keevers to revert to his previous role as the non-executive chairman.
Shareholders have approved the acquisition by Waverton Holdings 70.6 million shares, to take its shareholding to 80.09 per cent. They also approved increasing Waverton Holdings' voting power from 50 up to 80.09 per cent. (ASX: EMM)
The capital is to strengthen its balance sheet and provide flexibility to accelerate its development in Europe. Chairman, Julien Moulin, said "Following this successful fund raising our exploration program on existing assets will be fully funded for the next 12 months and European Gas will have additional capital to selectively secure additional material projects in Europe.
"This is a new start for the Company and we can now turn our full attention towards advancing our European exploration programs and adding significant new projects to our existing asset base."
European Gas has finalized farmout agreements in Northern France as part of its recent sale of the Gazonor assets to Transcor Astra.
The company will earn a 70 per cent participating interest in two large exploration permits covering 1,361 square kilometres through spending 2.795 million over two years. It will be operator for each permit as from now.
The agreements are for the Valenciennois and Sud-Midi Permits. In the next three months, European Gas will submit for Gazonor/Transcor France's approval the initial expenditure and proposed Work Program and Budget for the permits.
As part of the restructure of the same convertible notes, European Gas has entered a production sharing agreement with Transcor for two other large production permits covering 766 square kilometres in Northern France.
The agreement is for the Poissonnierre and Desiree coal mine methane permits. The parties said that by early November this year they will agree on the expenditure proposed by European Gas and the work program.
European Gas must spend a minimum of 1 million in exploration and development operations over two years. It will then receive a participating interest of 70 per cent in the increased revenue received by Gazonor/ Transcor France which is attributable to the enhanced gas production. Gazonor SAS remains the operator of the two permits.
European Gas has also reached an agreement to convert an unsecured loan of $2.5 million in conjunction with the capital raising. Five million shares have been issued to Ocean Dome Corporation at 50 cents each together with 6 million options exercisable by 30 April 2012 at 50 cents each. (ASX: EPG)
The strategy aims to leverage community awareness of its brands: Green Plumbers, Green Electricians, and Green Professionals. The proposed sales program has three complementary routes to market: Community Kiosks, Green Professionals, and Green Agents.
So far Community Kiosks have been deployed in selected high-traffic locations around Melbourne. Representatives have engaged with consumers to discuss the features and benefits of Green Invest's Green Star Alliance branded products and services, and consumers can order these.
Subject to the satisfactory completion of the 12 week pilot program, expected to conclude in July, a comprehensive rollout across Australia will be undertaken.
The Green Professionals Program was developed on the back of the Federal Government's now defunct Home Sustainability Assessment Scheme (HSAS). Following the Government's cancellation of the HSAS and its subsequently proposed replacement, Green Start, it was estimated that some 7,000 contracted assessors were rendered unemployed by the end of February 2011.
In response, Green Invest determined to construct a professional retail marketing, sales and distribution platform utilizing these specialists, and a modest number of Green Professionals have been assigned to the pilot program.
The Green Agents network involves small business owners across Australia selling Green Invest approved products and installation services to their clients. Green Invest provides these agents with avenues to products, marketing support and installation services through its Green Plumbers and Green Electricians.
Initial results for the Green Star Alliance program have been encouraging with sales numbers and revenue comfortably exceeding the company's aspirations. Although it will wait until the pilot program is completed to extrapolate net figures, it is preparing to extend the pilot program in other locations in or shortly after August.
Chairman Peter McCoy said "The Green Star Alliance Program is very important to this company's broader plans to extend our brands globally. With the larger and more mature markets in the USA, Europe and Asia beckoning, the consumer's validation of this pilot program will make expansion in these markets much more efficient, return greater value to our shareholders and assist in the reduction of emissions and wastage."
Green invest said its wholesale sales program will be rolled out before the end of this financial year, and will seek to leverage the relationships its has with trade associations and unions and its own membership.
"It is expected that the wholesale model will significantly increase sales revenues with a view, understandably, to the generation of significant additional shareholder value," it said. (GNV)
Green Rock Energy
"Mission has the largest biodiesel capacity in Malaysia and is well-poised to supply the B5 requirements," said Group chief executive, Nathan Mahalingam. "We are finalizing documentation and logistics with industry participants and anticipate that we will be commencing supplies in July 2011."
Implementation of the mandate has commenced with retail stations in Putra Jaya and will reach full compliance by 1 November 2011, resulting in around 200,000 tons of biodiesel demand per annum. Once fully implemented on a national scale, demand will increase to 500,000 tons per year, said Mission.
The government has allocated Malaysian Ringgit 43.1 million to finance the development of in-line blending facilities at six petroleum depots in the Central Region, which are owned by five oil companies: Petronas, Shell, Esso, Chevron and Boustead Petroleum Marketing.
The government has fixed the supply price of biodiesel to the oil companies linked to the monthly average RBD palm oil price, and the price of B5 at the pump will be similar to the retail price of normal diesel. (ASX: MBT)
"This strong market feedback confirms the company's experience in the Australian market that the same key benefits and features of the Trophon EPR are relevant and attractive in the US market," said chairman Maurie Stang.
The company is on track to launch into the US market this month. (ASX: NAN)
Richard Selwood and Robert Rooke have resigned as directors, and Simon Lill and Simon Col have joined the board. (ASX: NFL)
All new shares will receive listed options on a 1 for 2 basis, with a strike price of 4 cents per share and with a three-year term.
The proceeds of the equity raising, together with cash reserves, will be used to advance Panax's portfolio of near-term geothermal development opportunities in Indonesia, and for working capital. (ASX: PAX)
The grant is under the Federal Government's Australian Research Council Linkage program.
The Heliotherm solar thermal technology development project is a 100 per cent owned subsidiary company of Petratherm with an exclusive development agreement with the University of Adelaide.
The innovative project, pursued with the University's Centre for Energy Technology (CET), aims to reduce the cost of solar thermal technology by up to 40 per cent through the integration of solar thermal, geothermal and combustion technologies.
Petratherm managing director and member of the CET advisory board, Terry Kallis, said "The work involves designing and developing an integrated solar, geothermal and combustion system to achieve high efficiency base load power generation. The key innovation is using an integrated boiler that exploits all of the energy sources in a way to reduce capital costs and achieve a critical breakthrough in cost and efficiency in solar thermal technology."
Petratherm and the University of Adelaide plan to apply for further grants for up to $5 million under Round 3 of the Federal Government's Australian Solar Institute Program and the two newly announced Australian Centre for Renewable Energy Programs: the $100 million Emerging Renewables and the $100 million Renewable Energy Venture Capital Fund.
Petratherm and the University of Adelaide are also aiming to introduce a solar technology partner and an energy utility joint venturer to the project. (ASX: PTR)
Phoslock Water Solutions
PBL has purchased 42 tons or two shipping containers of Phoslock, with the first to be despatched in June and used for several projects in the Rio De Janeiro area. The second container will be despatched in the second half of the year.
Stymmulab, which has represented Phoslock in Brazil for two years, has expertise in aquatic ecology and considerable experience in using Phoslock in the treatment of a range of different water bodies.
GCT Bio has financial resources and a track record in developing environmental technologies. The company is involved in the development of biologically based solutions for the water and food industries in Brazil and manages a portfolio of projects valued at US$35 million.
Improving the quality of Brazil's water resources is a priority of the government. Significant levels of funding will become available in coming years to reduce the serious eutrophication problems faced by many of the country's water supply reservoirs and other water bodies, said Phoslock.
An extensive pipeline of projects has been identified by Phoslock Brazil, including a number of iconic water bodies in the Rio de Janeiro region which are expected to be restored prior to the FIFA World Cup in 2014 and the Summer Olympics in 2016. (ASX: PHK)
SWW said it is working with the ASX to satisfy the final conditions and apply for re-quotation.
The company's annual reports for the year ended 31 December 2009 and 31 December 2010 and a half year review to 30 June 2010 are expected to be completed shortly. (ASX: SWW)
WAG exercised the Deed of Option to acquire Pacific Pyrolysis Pty Ltd (PacPyro), acquiring the intellectual property, global development and commercialisation rights for the Slow Pyrolysis technology.
The company said this removes any real or perceived risk to the company in operating as a technology licensee, and all the benefits of commercialization, technology improvements and future R&D upside will now flow directly to PacPyro and WAG.
Global technology ownership will enable PacPyro to progressively expand its future business development, commercialization and carbon certification activities into China and India and into the Americas, Europe and Africa.
These markets have the attraction of massive potential feedstock streams including waste management.
The EPA estimates that US industry
disposes of 7.6 million tonnes of non-hazardous waste each year. The EU
estimates its agricultural residues are 700 million tonnes per annum,
and forestry residues 8,000 petajoules per annum in energy generation.
ABARE has forecast Australia's entire primary energy consumption to grow
to 7,715 petajoules in 2029-30, said the company.
Also attractive are national and regional carbon trading schemes including the EU Emissions Trading System, and schemes operating and under development in many US States and Canadian territories.
PacPyro's business model is to use its proprietary technology to: improve waste management and resource recovery, deliver renewable energy, provide greenhouse gas abatement, improve land use practices, increase agricultural yield and enhance food security.
Its near term activities will focus on the more advanced project opportunities to commercialize as a technology provider or co-project developer in Australia and New Zealand.
WAG expects to lodge a prospectus on 21 July, with the offer opening on 4 August. A shareholder meeting is scheduled for 16 August. (ASX: WAG)
Water Resources Group
"What I can say is that your directors are working very hard to improve WRG's performance. One of the first things that the Board, with management, instigated after last year end's listing on the ASX was a thorough review of all of WRG's business opportunities and technologies.
We did this out of concern that our business development was performing poorly and was impeding not only the share price, but also the advance of other aspects of WRG.
The review led to decisions to restructure the group's business. "This is an ongoing process that will take considerably more time to complete, as we eventually move the business more fully to the US.
"However, the restructure is essential in order to properly position WRG and reduce our burn rate so we can take advantage of opportunities which we have reason to believe are likely to arise in the near term as a result of the hard work that WRG has put into getting our technology and our business development to this stage."
WRG has three joint venture areas.
Chief executive officer, Brian Harcourt said that in Mexico, joint venture partner, ATL Interamericana, has advised that the project is still on track although delayed.
ATL is working with CAPAMA, the water commission operated by the municipality of Acapulco, to quantify and develop an opportunity to supply up to 40,000 cubic metres per day of water over the next three to four years. This is expected to generate over US$100 million in revenue for WRG.
"We have been advised that Fonadin, the Mexican National Infrastructure Fund, is making a grant to the project for US$45-50 million, in order to subsidize the cost of the water to the poorer community. This is delaying matters, but we are confident of securing this contract this year," he said.
In Morocco, directors expect to conclude a Water Offtake Agreement for 8,000 cubic metres per day and are confident significant additional business will follow.
WRG has a memorandum of understanding with Office Cherifien des Phosphates (OCP), the world's leading exporter of phosphate rock and derivative products. It is also largest enterprise in Morocco.
In Saudi Arabia, WRG had marketing and senior technical executives there in May and "that area is developing well. Upon WRG securing the Water Offtake Agreement with OCP we anticipate that this will open up significant business opportunities in Saudi Arabia." (ASX WRG)
The well was the last of a 10-well exploration program aimed at increasing certified 2P reserves in the Meridian SeamGas CSG gasfields by up to 200 Petajoules (PJ) gross.
The well reached a depth of 1029 metres and has been tested and suspended as a future monitoring well. The well intersected 21.5 metres of coal as expected.
Data from the entire program have been provided to independent certifier NSAI, together with a revised field development plan to support the targeted reserves upgrade, which is expected to be finalized early in the 2011-2012 financial year.
The next phase of the Meridian reserves expansion exploration program is now being planned. (ASX: WCL)
Hepburn Wind's share price is to rise from $1 to $1.10. 54 new members has signed up since its annual general and 13 members have increasing their holdings.
Contact received acceptances for 65.6 million shares worth NZ$331.9 million, Around 62.5 per cent of eligible shareholders took up some or all of their shares. The raising was underwritten.
Chief executive, Dennis Barnes, said "The success of the offer demonstrates strong support for the Company's strategy for investment in growth opportunities, the first part of which is the 166 megawatt (MW) Te Mihi power station to be constructed by mid-2013."
Contact Energy has also opened New Zealand's first underground gas storage facility and a new 200 megawatt, gas-fired peaker plant. Both were opened by Prime Minister John Key.
At a combined cost of over NZ$400 million, the projects are a significant addition to Contact's portfolio and enhance its ability to supply power in the volatile energy market.
The Ahuroa gas storage facility enables Contact to inject gas into the reservoir during periods in which it is not needed, such as in summer when demand for electricity is low, or when renewable energy is abundant. It bridges the gap between the way gas fields would like to produce and the way in which the energy market likes to use gas, said Mr Barnes.
"The peaker plant will add to New Zealand's security of supply by balancing weather-dependent renewables such as wind and hydro, and adding to supply during periods of peak demand," he said.
Capable of going from a cold start to full-power and producing enough electricity to power 200,000 homes in ten minutes, the plant offers the flexibility to meet spikes in demand.
Contact Energy acknowledged its majority shareholder, Origin Energy, in managing the development and construction of the Ahuroa gas storage facility. (NZX: CEN)
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