Further to the announcement on 27 November, Quadrise Plc (LON:QED) has reported testing results on its bioMSAR fuel, which the Company aims to supply to the marine and industrial markets. Quadrise’s sustainable biofuels are more efficient, cheaper than fuels currently used, safer, simpler to use and generate fewer harmful emissions.
Shore Capital note that investor interest in Quadrise has increased substantially since the Company’s AGM update on 27 November and the start of COP 28 with the shares up 80% since last week on relatively high volumes.
Key highlights of bioMSAR tests
bioMSAR tests were conducted on a 40kW Cummins diesel engine installed at Aquafuel Research’s site.
- bioMSAR blends containing up to 40% Crude Sugar Oil,Crude Sugar Oil, supplied by Vertoro, a biorefinery specialist, reduced carbon dioxide emissions by over 30% when considering increased engine efficiency of up to 7%. The blends also significantly reduced emissions of Nitrogen Oxides and Carbon Monoxide when compared with diesel.
- New bioMSAR formulations, which incorporate biofuels containing waste-based methyl esters were shown to reduce CO2 emissions by over 45%, increase engine efficiency by up to 7%, and reduce NOx and CO emissions significantly, providing a new potential pathway to bioMSAR Zero.
Further details on the testing results can be found in this morning’s RNS and on the Quadrise website: https://www.quadrise.com/references/biomsar-zero/
Next steps and opportunities
Further testing on a larger medium-speed engine is scheduled for H1 CY24. This will be performed in parallel with testing on bioMSAR with >40% Crude Sugar Oil at the Quadrise Research Facility and Aquafuel’s site. Work is progressing under the agreement with BTG Bioliquids on pyrolysis sugars derived from biomass and other potential partners that could supply sugars on a commercial scale.
We are encouraged that the tests on abundantly available resources show substantial emissions reductions and other advantages over diesel. As Quadrise’s CEO highlighted this morning, CEO’s of major shipping companies recently called for an end date to fossil-fuel only powered newbuild vessels and urged the IMO to create the regulatory conditions to accelerate the transition to green fuels at COP 28. We believe this joint declaration may have been generating investor interest in Quadrise, alongside the encouraging updates provided at the Company’s AGM.
The opportunity in the marine sector with MSC alone could be worth a multiple of Quadrise’s current enterprise value in potential annual revenues if only small percentage of the shipping company’s overall fuel demand was switched to MSAR or bioMSAR. MSC currently consumes close to 10m tonnes of fuel oil annually and we believe Quadrise could charge c.$50 per tonne for licensing its technology.
