Hazer Group Limited

Good morning, everyone. We're just going to be taking a few seconds to let people join the conference, and then we'll be starting the webinar. Good morning, everyone. Thank you for joining Hazel Group's webinar to update you on the company following the release of the third quarter report. On the call today, we are joined by CEO and MD Glen Corey and CTO Tim Forbes, who will discuss the report as part of a brief presentation. We will answer your pre-submitted questions at the end of the presentation. If you would like to ask a question today, please use the written Q&A facility at the bottom of your screen at any time during the webinar. The company will endeavor to answer all of the questions in the permitted time. Any questions that are not answered on the webinar will be followed up where possible. Questions have been consolidated where they cover the same topic. So your question may not be read exactly as you have written it. The webinar will be recorded and it will be posted to the Hazer website in the coming days. I will now hand over to Glenn to begin.

Thanks, Krista. Hello, everyone, and welcome to our Q3 results webinar. I'm Glenn, the CEO of the Hazer Group. It's great to be here again. Joining me on the call is Tim Forbes, our Chief Technology Officer. He'll talk to some of the positive signposts coming out of our CDP very shortly, and then we'll jump as soon as we can into Q&A. Our agenda is as follows. First, we want to touch on the quarterly highlights. That'll be myself. I'll then pass it over to Tim, who'll give an update on the CDP and speak to all the really good progress that we're making. There in particular in our first two and a half months of operation. I'll then talk briefly about our corporate update. And then before we open up for Q&A, I'd like to reiterate our strategic priorities for the 2024 calendar year. Moving into our Q3 highlights, we put our report out on Monday. You'll have seen the headlines. It's been a big and, well, very pivotal quarter for Hazen, a very important one in terms of the development of our technology at scale, in particular since our previous pilot plant between 2017 and 2021. Firstly, we have brought online our commercial demonstration plant. We're now producing hydrogen and graphite, And I really want to underline the significant milestone that this is. It is a world first commercial level demonstration of the hazer technology and the hazer process. And I believe, to be validated, I believe this is the second largest clean hydrogen production facility in Australia. So that does give you some, I guess, insight into how quickly we can scale this technology to commercialization. Secondly, it's hard to believe we've been online for only two and a half months. The test program, which Tim will talk to shortly, is on track. We've just done a third successful run post the end of the quarter. We've now achieved over 50 hours of continuous hot operation. And we've got a lot of positive signposts coming out of the CDP test program. And again, Tim will talk to that shortly. Thirdly, we have a robust funding position. for accelerating our technology and the commercialization phase of our business. Thank you to the support of all of our shareholders for the 14 and a bit million dollar capital raise, both our placement as well as our share purchase plan, which was oversubscribed. In addition to that, we've also unlocked another near on a million dollars from our arena, the Australian Renewable Energy Agency arrangement and agreement, which does again point to the good progress we're making at the CDP. Our business is low burn. We've now got an extended runway. through some really significant milestones for the company. We've got lots of funding flexibility, a discretionary portfolio, zero debt. And we've got throughout this year and into next year, other non-dilutionary inflows of capital expected. In particular, every year we receive a fairly handsome R&D rebate. Finally, I spent a week or less than a week in Houston at Sarah Week. I'll talk a little bit about the headlines coming out of there, but I do want to highlight that methane paralysis, what we do as Hazer, featured very heavily there in the spotlight. Moving on to our commercial demonstration plant, I'll hand it over to Tim very shortly, but again, just underlining, it's a significant achievement for the company to have our CDP now online. It is the first time we've had this technology operating at a commercial demonstration level and scale. It is the world's first fully integrated demonstration of the Hazer process. We're about validating the technology on a commercial basis on a continuous level. We are using biogas as a reminder. as the gas supply from the Water Corporation, which does actually make our CDP carbon negative. So that's a massive tick from an environmental perspective. And again, supported effectively all of the grant funding that came from ARENA. And we're again, proud to be working alongside Water Corporation. First hydrogen and graphite production was this year in January. We have spent $105 million on this technology over the last 15 years. We've successfully proven and scaled it up five times over that time scale. And we're now moving into the commercialization phase with bringing our CDP online. Tim, I think that's a good time to hand over to you for an update on the details and results coming out of the initial runs.

Yeah, thanks, Glenn. And good morning, everyone. Great to be here again. So in terms of where we're at with the CDP, as Glenn says, it's super exciting for us to have this facility built and now operational, and we're making good progress on our test program. So we do have a test program plan that is campaign based where we'll run some specific tests, have a plan shut down, complete inspection analysis before continuing on to the next test in the plan. The ultimate objective of this is really to demonstrate long-term sustained continuous operation. And it's that learning in the early phases that is going to enable that long-term continuous operation. Now, in terms of the benefit of the scale that we're operating at here, I just want to highlight again that this is at a commercially relevant flow regime and hydrodynamics. So what does that mean? That means that the risk in performance predictions going from this to the next large scale design is substantially de-risked. So going from pilot scale to the CDP is a big jump and the next jump is much smaller. And that's around wall effects, bubble size versus reactor and a bunch of technical details. But this is a big step in de-risking the technology. Glenn, can you jump to the next slide, please? So our early results are in line with expectation and give us confidence in the ability for the technology to perform at scale. What we've been working through in the first few runs really is finding out commissioning issues. So things like optimizing procedures, tuning control loops, adjusting valve sequencing things, typically ancillary equipment to help improve reactor control and stability. And the core technology performance in terms of hydrogen and graphite production is in line with expectation and gives us confidence in the ability for the technology to perform at scale. And as we iron out these commissioning challenges, we think we're getting pretty close to achieving the 100 hours and beyond operation. Next slide, please. So in terms of what are we really trying to achieve with the test program, that really fits into three pillars that if we achieve the objectives in these areas, that'll give us the confidence in the technology performance to convince our project partners to proceed with project commitments. So these pillars are number one, producing hydrogen and graphite, just demonstrating the technology works. And from run one, we've produced substantial amount of hydrogen from the initial startup. Next up after that, we'll be producing larger volumes of graphite with steady and continuous operation and consistent product quality to enable us to move into the next round Tim Jones- Product development testing to progress towards commercial off take that's hydrogen graphite production next up continuous operation. Tim Jones- So this is about demonstrating control of the process and also understanding long term performance and any performance degradation due to fouling and and things like that so. Off the bat, we've got the 24 hour run completed and we're up to 59 hours in run three. We'll be aiming to get to 100 hours and beyond with the ultimate objective to be running for many months continuously, as well as demonstrating steady state operation of our solids handling equipment. And then lastly, the hydrogen and graphite production rates from the equipment will be used to validate large scale commercial reactor design, hydrogen production requirements, prove the ability to produce high purity graphite at a reasonable amount of catalyst consumption. And in general, we'd say we're on track and we're confident we've got sufficient margin in our design and we directionally expect improved results as our reactors get bigger in the larger scale design. So things are progressing well. We'll be looking to provide results, material results when they're available. We're looking forward to reporting back with some green dots on the scorecard here in the near term. And I'll hand over to Glenn from here, thanks.