Synthesis Energy Systems, Inc. Enter into Definitive Technology License Agreement with Australian Future Energy Pty Ltd
May 11, 2017 at 06:50 am
Share
Synthesis Energy Systems, Inc. (SES) announced that it has entered into a definitive Technology License Agreement with Australian Future Energy Pty Ltd. (AFE) for a large-scale project to be located in Australia. Based on the terms of the agreement, SES will receive fees based on the licensed capacity for the project, and for the Process Design Package (PDP), totaling $27 million. In addition to the Technology License and PDP, SES will immediately begin providing technical services to AFE related to the development of the project. It is expected that the project will purchase proprietary equipment from SES which, based on the license capacity of the project, could be valued at approximately $120 million and would be contracted soon after completion of the PDP. Fees are to be paid at agreed milestones across the development, design, construction, start-up and operations of the project. The entire package of technology, services and equipment is expected to provide SES with top line revenue of approximately $150 million, with attractive gross profit margins. This Technology License Agreement kicks off AFE’s first project. It is expected to be the first of several AFE projects developed for industrial-scale poly-generation facilities that produce low-cost syngas, ammonia for nitrogen fertilizer and ammonium nitrate products, as well as synthetic natural gas (SNG) and electric power. AFE has identified several project opportunities, and is expected to carry two of these projects forward into development, design and construction, subject to obtaining all necessary Government approvals and funding. A similar second Technology License and PDP order is also anticipated either later this year or next year related to AFE’s second project undertaking.
Synthesis Energy Systems, Inc. together with its subsidiaries is a global clean energy company. The Company owns SES Gasification Technology (SGT), which is used for production of synthesis gas. The SGT produces syngas that provide alternative to other forms of energy such as natural gas, liquefied natural gas (LNG), crude oil and the conventional utilization of coal in boilers for power generation. It manufactures clean syngas from a range of natural and renewable resources, such as all forms of coal, biomass, municipal solid waste (MSW), and refuse derived fuels. The Syngas is used to produce a range of clean energy and chemical products such as synthetic natural gas, power, methanol, and fertilizer. The Company is focused on commercializing SGT both in China and globally through the regional business platforms.