- The quarter ending December 31, 2020, saw Hazer Group (HZR) secure several grants with which to progress its commercial development project (CDP)
- Hazer received $9.4 million under an Australian Renewable Energy Agency (ARENA) grant, a $950,000 research and development tax incentive, and $12,000 from federal COVID-related support
- These were partially offset by operating cash payments of $2.6 million, resulting in net operating cash inflows of $8.7 million
- At the end of the year, engineering activities for the CDP were estimated to be 65 per cent complete
- Hazer Group is up 11.3 per cent to $1.73 per share
The quarter ending December 31, 2020, saw Hazer Group (HZR) secure several grants with which to progress its commercial development project (CDP).
Hazer received $9.4 million under an Australian Renewable Energy Agency (ARENA) grant, which the company said would support the design, procurement, construction and operation of the project, located at the Water Corporation's Woodman Point waste-water treatment plant in Western Australia.
A further $950,000 was secured pursuant to a research and development tax incentive rebate, while $75,000 came from the first tranche of the Western Australian State Government's Renewable Hydrogen Fund — worth $250,000 in total — and $12,000 was received from the federal government as COVID-related support.
These were partially offset by operating cash payments of $2.6 million, resulting in net operating cash inflows of $8.7 million for the quarter. By year's end, Hazer had just shy of $29 million in the bank.
Using biogas produced at the treatment plant as feedstock, Hazer's Commercial Development Project (CDP) represents the key next step in commercialising the company's "Hazer Process" for producing renewable, low emission hydrogen and graphite.
With substantial progress made on permitting activities, Hazer anticipates civil site preparation to begin in the first quarter of 2021.
At the end of 2020, engineering activities had been estimated to be 65 per cent complete, thanks in part to the completion of several design safety reviews.
Orders for most major equipment have now been made, most notably for the supply of process compression equipment from a new vendor. This follows a number of technical and supply difficulties, largely brought on by the COVID-19 pandemic, which had been identified with the original supplier.
While competition for resources and pressure on international supply chains has seen a marginal increase in budgetary amounts, Hazer said the CDP retains a significant contingency allowance to mitigate these impacts.
As announced on November 30, the project has an approved capex budget of $17 million, and an overall final budget range is currently projected to be between $17.2 and $17.6 million.
Hazer Group is up 11.3 per cent to $1.73 per share at 11:58 am AEDT.