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Thanks n888, that is interesting, Linde didn't come up on my 'engineering company' search's but it certainly fits the bill really well.
I'm looking forward to finding out who the “very large engineering company, a German one with a lot of expertise in gases” , is that Tim mentioned in the webinar, bearing in mind what an impact collaborations have had on both AFC and ITM.
I don't think it will be Siemens or Bosch as I can't find any link to gasses but Thyssenkrupps and BASF look promising, with EPC Group being an outsider because their gas side looks a bit niche.
Does anyone else have any thoughts on who this company could be, maybe our German and Austrian friends might have some better insight.
Javbri, frustrating yes, concerning no. It is very unlikely that any serious building work will start before financial close is confirmed.
Yes, we have slipped a little but in the grand scheme of things it will make little difference.
Don't forget, PHE will be ordering the long lead-time items such as the kiln very soon, maybe before the end of the month.
The progress in Poland that Tim Yeo divulged on Thursday evening is very encouraging. The first Polish unit could be up and running within the same expected time-frame as Protos. This is really good as we now have a race to be the FOAK.
A 5,631,366 buy went through at 17:03:13....nice!
I don't think I've seen any mention today about slide 14, 48Mwh exportable and 2 to 3 tonnes per day of hydrogen....this is another significant increase and could well be why Tim said they would re-visit the level of the licence fee after the FOAK.
xxxAccountant, could you explain to me why you think PHE will only make 10 to 20% ebitda on the prospective £2.5bn licence fees?
Moggy1, spot on, rec.
Thanks Dr. A, there really is so much going on behind the scenes.
operastar, that is an old PHE video and the narrator was the previous CEO, Keith Allaun.
The first point to make clear is that this goal of $1.5/kg is the cost of production....not retail cost.
This goal is based on a cost of energy of $20/Mwh but where are they going to get their energy so cheap 24 hours a day?
We all know that there is cheap electricity available overnight...but for how much longer?
The move is towards variable energy tariffs, i.e. if you want energy at times of high demand you pay more and vice-versa. As this plays out it will become increasingly financially viable to buy a storage battery for the home that you charge when prices are low and use when prices are high, which could ultimately inflate those low overnight tariffs.
Anyone at the moment with an electric car will have already sought out an energy provider that allows them to recharge their car overnight at a much reduced tariff. Even without the take-up of time-shifting house batteries the fast growing number of electric vehicles is going to reduce the availability of cheap overnight electricity and again the higher demand will increase the tariff.
So, I think it unlikely that the target of $20/Mwh is going to be achieved, unless they build their own wind-farms.
On the positive side, as I posted last December, I think the DMG process is already in that production cost ball-park, underlined by Howard White stating that in Poland they could retail at, from memory, 3 to 5 Euros/kg.
So, nothing to fear from the dream of $1.5/kg production cost of H2 via electrolysis.
Hi Mark, my understanding is that the raise was to enable PHE to purchase long lead-time components now, before Peel completed financial close (by the end of Q1) to stop any slippage of build time.
It is up to the board and Peel to negotiates whether PHE take a refund on those components or take a stake in the FOAK.
I expect we will get confirmation eather way upon completion of financial close.
Should PHE negotiate a 50% stake in the FOAK then yes I would expect that we could break even on just that one .
Energyman, I wouldn't expect the build to start until financial close is announced, which as stated above is by the end of Q1.
Yes, so far it is £500,000 or Euro's payable once commissioned.
From memory it's 30% up front with stage payments.
Interesting that you refer to the DMG as a mouse trap.
Well said that economist.
Fair enough Mark, but how do you account for your next post?
RE: How many units game30 Jan 2021 22:45
I was just being realistic. Yes on paper you could build 50 at once, but do you really think people will? A build can take a year with planning. Each unit costs over 5mil to build (I think its about 8 mil). How many companies do you know that have that much cash sat about to build 20 plus at once? I just don't see it myself.
Beg to differ Mark.
How many units game29 Jan 2021 13:49
Just for fun and to break up some of the negative down days right now (to be expected days -great share in myview long term).
How many DMGs do you think there will be (built) by end of 2021, 2022, 2023, 2024, 2025 + 2030. Remember build time is around 6 plus months. I will go first.
2021 - 1 DMG -Protos
2022 - 3 DMGs - protos + 2 more in UK.
2023 - 6 DMGs 5 UK + 1 Poland
2024 - 15 DMGs 11 UK + 3 Poland + 1 Mainland Europe
2025 - 25 DMGs 11 UK + 5 Poland + 8 Mainland Europe + 1 Japan
2030 - 100 DMGs - Everywhere.
It wouldn't surprise me if the Western world actually banned the incineration and landfill of any type of plastic in the near future due to the cleanliness and high energy recovery of the PHE DMG system.
Hi Mark, I think you've highlighted your own underestimation right there, 'So by your working maybe 25ish in 3 years', but that is only two licensees, there will be many more after the FOAK, all with the same potential roll-out speed snowballing.
It's very likely we'll hit your 100 in ten years in three, most certainly in four. :)
Listen to Piltick, he's been here a number of years and understands the way this will roll out across many regions of the world, not quite but very nearly simultaneously.
We have not started the first build yet but we already have two potential licensees, (as far as I am aware Peel has not yet paid for the UK licence and Poland is still at the HOT stage but with a non-refundable deposit of £100,000).
HW informs us that he expects the first 10 in Poland will be up and running within three years and I have no reason to think that Peel will be any slower with the roll-out of their first 11.
Within that three year period I fully expect these two licensees to receive orders from third parties within their respective countries and there would be no reason why these extra projects would not be carried out simultaneously with their own.
As this year progresses I fully expect PHE to sign up a few more licensees before the the FOAK is completed, once completed that number will increase pretty quickly.
As said, we currently have two (potential) licensees who should have 21 units in operation just from their own current projects within three years, by the end of next year there is no reason why we shouldn't have another ten or more licensees all doing the same as Peel and HUI. The annual build numbers will escalate year on year, like the proverbial snowball.
The key to this is the PHE business model, they are not tied up trying to fund an ever increasing number of projects, they are not going to build their own factory to make the DMG's, although they may bring the 'black box' in house some time in the future. There is no shortage of international engineering companies who want to build this so there will be no bottleneck to speedy growth.
All PHE has to do, and it raised £5m towards this last year, is build a team of engineers/project managers to consult on planning and carry out commissioning/maintenance, which will also bring in further income.
When this is more widely understood we will be chasing the market cap that HW alluded to in his podcast.
I'm not sure if you are aware b&s but Howard White has already put forward that exact business model for Indonesia. :)
Hi xxx, could I ask why you think a future earnings of £500m would equate t £400m ebitda ?
Hi Markrops, nice to see you now understand the potentially speedy rollout of DMG on many parallel fronts.
Don't forget that the White family have 26% of the company and there are also many LTH's with sizable investments also, so it might not be all that easy as a take over target, certainly not on the cheap at least. You heard in the podcast that Howard White has a passion for DMG to make a difference in this world.