Investors continue to like Clean TeQ’s commercialization story with the company’s shares more than doubling in less than two weeks to an all time high of $1.045 in early March. The high was despite an interim loss announced in mid February of $8.1 million. Revenue fell to a modest $325,000 and there was a $6.4 million cost for employee expenses of which $4.7 million was share based payments.
Clean TeQ has two business units. The Metals Division is developing the Syerston scandium oxide, nickel sulphate and cobalt sulphate project in NSW for the lithium ion battery market. The Water Division is developing water purification projects in China. Clean TeQ said it is working towards securing commercial contracts in the near future, and anticipates both divisions will produce substantial revenues in the future.
Developing the Syerston Project received a big boost with Clean TeQ forming a partnership with Chinese conglomerate, Pengxin Mining, to fast track its development. Pengxin Mining will invest an initial $81 million in Clean TeQ at 88 cents per share and help facilitate Chinese project-debt financing for the Project. The placement should be completed by the end of March and will give Pengxin 16.2 per cent of Clean TeQ. The chairman of Pengxin Group, Jiang Zhaobai, will be appointed co-chairman of Clean TeQ alongside Robert Friedland.
The capital will fund the completion of the Syerston Definitive Feasibility Study due in the fourth quarter this year and will also help accelerate the project.
Clean TeQ has total assets of $39 million and net assets of $34 million so another $81 million in capital at an historically high share price will make a big difference to its balance sheet. No doubt this vote of confidence had much to do with the big surge in the share price.
Also new is a $632,285 grant under the Federal Cooperative Research Centres Project program to develop energy efficient wastewater treatment technology using graphene oxide technology. The development will be in association with Ionic Industries Ltd and Monash University.
Graphene oxide is now seen as a ‘wonder’ material as it can be atomic level ultra-thin yet super-strong. Monash University researchers have developed a way of producing graphene oxide which is suitable for water and wastewater filtration products and has the potential to be economically scaled for commercial needs. The use of graphene oxide adsorbents in Clean TeQ’s Continuous Ionic Filtration (CIF) water filtration technology will extend the range of waters it can treat. (ASX: CLQ).