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PyroGenesis Canada Inc
Symbol PYR
Shares Issued 170,140,795
Close 2022-01-31 C$ 3.48
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PyroGenesis submits cost estimate for 36 plasma torches

2022-02-01 12:14 ET - News Release

Mr. Peter Pascali reports

PYROGENESIS CONFIRMS SUBMISSION OF A COST ESTIMATE FOR 36 PLASMA TORCHES TO CLIENT A, A MULTI-BILLION-DOLLAR INTERNATIONAL PRODUCER OF IRON ORE PELLETS, FOR $95-115 MILLION

PyroGenesis Canada Inc. has confirmed that, further to its Q3 2021 financial results press release, as well as its press release dated June 3, 2021, it has submitted, as requested by Client A, a cost estimate for 36 plasma torches.

The cost estimate submitted was for $75-million (U.S.) to $95-million (U.S.) (Canadian equivalent: $95-million to $115-million) for 36 plasma torches (three megawatts). The range is an estimate due to certain uncertainties which will be more clearly defined in due course.

"We wish to emphasis that this announcement is as a result of a previously announced request for a cost estimate by a client and in no way means, or implies, future revenues will result from this," said P. Peter Pascali, chief executive officer and chair of PyroGenesis.

As previously disclosed, Client A is a multibillion-dollar international producer of iron ore pellets and one of the largest in the industry, whose name will remain confidential for competitive reasons. The client, which has committed to reduce its GHG emissions, has over 10 plants, each possibly requiring up to 50 plasma torches (one megawatt). PyroGenesis has the only patented process in the iron ore pelletization industry designed to replace dirty fossil fuel burners with environmentally friendly plasma torches, thereby greatly reducing emissions.

Separately, the company announced last week that a factory acceptance test is scheduled to be conducted between Feb. 2 and Feb. 14, 2022, for the use of its plasma torches in iron or pelletization with Client A.

"Although we recognize that this is a request for a cost estimate, and that there is no guarantee that the order will ever be made and, if it is, that it will be made within the price range noted herein, we also appreciate the fact that this is a strong indication of interest following extensive due diligence by a multibillion-dollar company," said Mr. Pascali, CEO and chair of PyroGenesis. "What is important to take away from our announcement today, and others made in the recent past, is not only that things are progressing as they should, and that we are conservatively ticking the boxes one by one, but the sheer magnitude of this opportunity for the company if we are successful. Again, that is not to say that there are no risks moving forward, but we are certainly moving in the right direction with the right players."

PyroGenesis estimates that worldwide pellet production of 400 million tonnes consumes between 8,000 and 12,000 megawatts of energy annually. The company estimates that the potential addressable market is over $10-billion, assuming a one-to-one replacement of fossil fuel burners with an estimated 10,000 one-megawatt plasma torches, based on an assumed cost per plasma torch (one megawatt) of approximately $1.5-million.

About PyroGenesis Canada Inc.

PyroGenesis Canada, a high-tech company, is a leader in the design, development, manufacture and commercialization of advanced plasma processes and sustainable solutions which reduce greenhouse gases (GHG), and are economically attractive alternatives to conventional dirty processes. PyroGenesis has created proprietary, patented and advanced plasma technologies that are being vetted and adopted by multiple multibillion-dollar industry leaders in four massive markets: iron ore pelletization, aluminum, waste management and additive manufacturing. With a team of experienced engineers, scientists and technicians working out of its Montreal office, and its 3,800-square-metre and 2,940-square-metre manufacturing facilities, PyroGenesis maintains its competitive advantage by remaining at the forefront of technology development and commercialization. The operations are ISO 9001:2015 and AS9100D certified, having been ISO certified since 1997.

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