Velocys raises £7M, secures £2.8M in co-funding from BA, Shell
PHOTO: Velocys
July 19, 2019
BY Erin Voegele
Velocys plc announced June 15 it has secured £7 million ($8.75 million) by way of a placing of more than 233.33 million new ordinary shares at a placing price of 3 pence (40 cents) per share by certain existing shareholders and new institutional investors.
Net proceeds of the placing will be used to complete development capital fund raising and initial stages of development of the front end engineering design (FEED) for the company’s biorefinery project in Mississippi. The funds will also be used to strengthen and extend the company’s intellectual property portfolio, for working capital and central costs and on analyzing and testing catalyst and Fischer-Tropsch reactors from the recently completed full-scale demonstration run in Oklahoma.
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Velocys said the placing complements commitments received by the company from the Altalto Immingham waste-to-sustainable fuels project’s strategic partners, British Airways and Shell, of £2.8 million.
“I am delighted with the level of support Velocys has received from existing and new institutional investor,” said Henrik Wareborn, CEO of Velocys. “This complements the commitments by Shell and British Airways to co-fund the remaining pre-FEED project work to bring the Altalto Immingham biorefinery project to the same state of pre-FEED completion as our Bayou Fuels project in Mississippi. As a result we can provide strategic partners with two truly sustainable fuel projects, and a solution that can be deployed widely to decarbonize aviation and heavy goods transport.”
In mid-June, the company released the results of its annual general meeting. In a statement, Velocys Chairman Pierre Jungels said “Velocys is now an advanced biofuels company.” He said the transition was completed thanks to the technical prof point reached upon completion of the commercial-scale demonstration runs of the company’s FT reactors at the Envia project and through the commercial progress made at its proposed Immingham U.K. waste-to-jet fuel and Natches Mississippi biorefinery projects.
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“Velocys will now leverage all the learnings and experience from running full cycle commercial operations at Envia into the two commercial scale biorefinery projects in Natchez and Immingham in collaboration with our financial and technology partners,” Jungels said.
“The demand for sustainable jet fuel could not be more obvious,” he continued. “Velocys is in a unique position to offer a de-risked, scalable and executable solution to convert solid waste feedstocks into sustainable jet fuel with a minimal carbon intensity both in the U.S. and in the U.K. subject to continued shareholder and strategic partner support.”
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