Regulatory Filings • Aug 8, 2023
Regulatory Filings
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HydrogenPro ASA (OSE: HYPRO) Extended Revised Priorities HydrogenPro ASA
HydrogenPro ASA (OSE: HYPRO) Extended Revised Priorities HydrogenPro ASA
Oslo 8 August 2023
Brief summary of revised priorities for HydrogenPro (the "Company"):
1. Maintain focus on the US market but seek alternative funding sources and
partnerships to reduce the need for raising equity capital by way of issuance of
new shares in the current market.
2. Take advantage of the current broad investor interest in hydrogen in the US
stimulated by numerous federal and local incentive schemes, and:
a. Build a US management team to become a driving force in the Company´s US
strategy based on local knowhow and networks.
b. Seek a possible listing for the Company's shares at the Nasdaq stock
exchange in New York.
3. Demonstrate to customers that HydrogenPro can produce hydrogen at a
significantly lower cost due to reduced power consumption per kg H\2\ compared
to other alkaline or PEM solutions.
4. Explain how the Company can obtain a fast and international growth based on:
a. Ownership to all Intellectual Property Rights related to its third
generation electrolyzers.
b. No shortage of vital components like rare noble metal which severely
limits PEM solutions.
5. Maintain a leading position in technology by enforcing R&D efforts.
6. Adapt and develop the organization in line with the adjusted priorities and
maintain close cooperation with partners like Mitsubishi and ANDRITZ. To
facilitate this transition, as mentioned in today's press release, Jarle Dragvik
will replace Tarjei Johansen as CEO of HydrogenPro.
Please see below for further details.
HydrogenPro announced some time ago plans for building production capacity in
the US and proposed to finance the expansion mainly through equity by way of
issuance of new shares in the Company. The plan for building capacity in the US
stays firm but given the current market sentiment the Company is actively
working on alternative ways to finance the expansion.
The new actions are explained below, and with HydrogenPro's already strong and
industry leading product portfolio, the Company is in a good position to
implement the new solutions. HydrogenPro will plan this in close partnerships
with local industry leaders within engineering, construction and other related
fields.
STATUS IN THE INDUSTRY
The interest for green hydrogen is growing rapidly throughout the world and will
require entirely new supply chain solutions and access to renewable energy.
Reaching IEA´s net zero targets will require the installation of 3.600 GW of
electrolyzer capacity by 2050, projected to represent up to half a million 5,5MW
electrolyzer units. HydrogenPro aims at taking a leading supply position in this
market USD billion market.
HydrogenPro with its forefront technology and efficiency is focused on becoming
a leading supplier of high pressure alkaline electrolyzers for green hydrogen
production. There are currently two well-known electrolyzer technologies that
are active in the market - PEM and Alkaline. High pressure alkaline technology
has emerged as the winning solution for large scale industrial projects and does
not require the costly disadvantage of rare noble
metals.
Electric power amounts to about 80% of the cost of producing hydrogen, and this
is exactly where HydrogenPro has a unique competitive advantage due to its
coating technology that provides significant efficiency improvements through 14%
lower electricity consumption. This benefit is of the same magnitude as the
entire capex, which gives the company a favorable position in the market.
Many countries talk loudly about their plans to go green, but little has
happened. USA on the other hand, has taken a lead role in developing green
hydrogen with its federal stimulation package (IRA) combined with numerous state
-based initiatives, resulting in a flow of investor interest in the US for green
hydrogen production. HydrogenPro wants to take advantage of this interest and
work closely with local partners to achieve higher goals than what the Company
can manage alone, and to do so with limited dilution to its shareholders.
MAJOR ACHIEVEMENTS TO DATE
1. Obtained full IP rights to core technology whereby complete and independent
production can be set up anywhere.
2. Built a large-scale production facility in China for 500 MW per year which
may serve as a model for factories in other markets.
3. Acquired a Danish coating technology that puts HydrogenPro's electrolyzers
in a class of its own with regards to cost per produced kilo of hydrogen.
4. Established a full-size coating factory in Denmark which will also serve as
a model for plating facilities in other markets.
5. First producer of high-pressure electrolyzers to be certified according to
KHK (Japanese requirement).
6. Sold and delivered a full size 5.5 MW electrolyzer unit to Japan.
7. Started delivery on the ACES contract with Mitsubishi USA for 40 full size
5.5 MW electrolyzers.
8. Chosen as exclusive supplier to DG Fuels for electrolyzers to their 839 MW
synthetic aviation fuel (SAF) project in Louisiana that they are developing
together with major players in the aviation industry.
9. Built a substantial pipeline of prospects including several FEED contracts
with major energy companies.
ACTION PLANS
On this backdrop, the board of directors has decided to:
1. Focus its efforts on the North American market and take specific actions
along two avenues:
a. Commence preparations for a possible listing at the Nasdaq stock exchange
in New York in order to secure access to a larger investor universe.
b. Build up the US management team to become a strong force in the Company´s
US strategy and thereby draw on local business development knowhow and use of
financial resources, including working with the most progressive US states.
2. Maintain its position as a technology leader to generate shareholders value
by continuing to develop next generation efficient, high pressure electrolyzers.
3. Build a competent European organization to i) take good care of local
customers and successfully develop the Andritz collaboration, ii) streamline the
current production facility in China and iii) develop the Middle East markets
with local partners.
EXECUTION
To facilitate the new strategic direction, Tarjei Johansen will step down as CEO
and Jarle Dragvik will serve as a CEO of HydrogenPro ASA. Mr. Dragvik is the
current CEO of TM Holding AS, the Company's second largest shareholder. He knows
HydrogenPro well as he served on the board until May 2023 and has for years been
chairman of HydrogenPro's Chinese operation.
Richard Espeseth, board member, founder, and Head of Technology in HydrogenPro,
will together with Mr. Dragvik and Kermit Nash, chairman of HydrogenPro Inc.,
form a team to find potential US partners and sub suppliers, build the US
management team and follow up on existing contracts and prospects in the US.
This will include to enhance the close relationships with Mitsubishi and DG
Fuels, among others.
Mr. Nash has a broad business background including many years within supply
chain operations, and he has thereafter through more than 10 years of practice
as a business lawyer, built up extensive networks within infrastructure,
manufacturing and finance within all main energy sectors.
Ellen Hanetho, chair of the board of HydrogenPro ASA, will together with Terje
Mikalsen, co-founder and board member, prepare for the listing on Nasdaq. Ms.
Hanetho has a broad background from strategic business development and
investment banking and Mr. Mikalsen is an experienced venture capital and
private equity owner whose merits include the introduction of three leading
Norwegian companies to the NY stock market.
For additional information, please contact:
Ellen Hanetho, Chair of the Board of Directors
Email: [email protected]
Phone: +47 48 220 750
Jarle Dragvik, CEO
Email: [email protected]
Phone: +47 911 72 734
About HydrogenPro:
HydrogenPro is a technology company and an OEM for high pressure alkaline
electrolyser and supplies large scale green hydrogen technology & systems. The
Company was founded in 2013 by individuals with background from the electrolysis
industry which was established in Telemark, Norway by Norsk Hydro in 1927. We
are an experienced engineering team of leading industry experts, drawing upon
unparalleled experience and expertise in the hydrogen and renewable energy
industry.
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