Quadrise has entered into an agreement with an international chemicals and mining group headquartered in Morocco. During calendar Q120 the two parties will work together on a project to carry out a trial of MSAR, Quadrise’s synthetic enhanced heavy fuel oil, on a pilot plant test facility located at one of the client’s sites in Morocco. If successful, Quadrise will then undertake feasibility studies in preparation for commercial-scale trials on an industrial unit and a steam boiler owned and operated by the client. These potential trials would be covered by new agreements.
The cost of the initial trial is estimated at £16k, to be shared equally between Quadrise and the client, with Quadrise providing MSAR fuel, related equipment and engineering services to support this initial test phase. Quadrise will submit a written report to the client when the test phase has been completed. Assuming that this first phase is successful, the client will pay Quadrise £100k for the feasibility and engineering studies for commercial-scale trials, payable in stages on reaching agreed milestones.
Quadrise’s representative in Morocco, Younes Maamar, is the former CEO of the Moroccan state electricity company and was instrumental in securing this agreement. Under the terms of his agreement with Quadrise announced in March 2019, Quadrise will issue Younes Maamar with 3m warrants, exercisable at any time until 6 March 2022 and at a price equal to the average mid-market closing price over the five days ending on and including 29 November 2019.
The news demonstrates that management’s policy of incentivising local distributors with warrants is resulting in meaningful projects. Moreover, it indicates the potential for wider interest in MSAR for industrial applications as well as in the marine bunker fuel and power generation sectors.