IPO Watch: WA bioenergy company Delorean set to list on the ASX next Thursday
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Bioenergy company Delorean (ASX:DEL) will be the ASX’s next renewable energy company when it lists next week after a $14 million IPO.
Bioenergy is a form of renewable energy that is derived from recently living organic materials known as biomass. Biomass can include wood, energy crops or even waste and it is the latter that Delorean specialises in.
Delorean has raised $14 million in its IPO and is set to list on Thursday next week. It has operated the Jandakot Bioenergy plant in WA since 2015.
Additionally it has two projects in South Australia and New Zealand under construction and another two in a “shovel ready” state set to begin construction after its IPO.
It intends to eventually become a “gentailer” – which means both a generator and retailer of energy.
While there are plenty of ways to generate bioenergy, Delorean’s plants specialise in a process called anaerobic digestion.
Anaerobic digestion is a process that breaks down organic matter that then produces clean biogas suitable for energy.
“Effectively what we’re doing – it’s the same as a cow’s stomach – [using] a mechanical blood that’s breaking down organic waste whether that’s in the form of residential, agricultural or organic waste through a biological process to output a nutrient rich fertiliser,” co-founder Joseph Oliver explained for Stockhead.
“But the volatile matter gives us the methane that we’re able to upgrade to biomethane – green gas – we’re able put it into a generator and create green power.
“There’s lots of different uses of that energy output from a biogas perspective.”
Oliver said while COVID-19 state border closures bought some disruptions, the way the pandemic forced many to rethink their lives and the world around them extended to the use of energy.
“I think COVID has certainly helped with the line that we can’t keep using fossil fuels we need to start recycling, reusing, recapturing those nutrients but using that byproduct of energy,” he said.
While Oliver admits Australia has been behind the rest of the world in biogas adoption, things are changing.
“It’s an exciting time, we’re starting the journey here in Australia where we’re recognising there’s value to waste streams other than putting it into landfill.”
Delorean is already earnings profitable – making $3.6 million in EBITDA in FY20 – and has grown through its own earnings.
But Oliver says the IPO proceeds will take Delorean to the next level.
“Our focus is capitalising the business enabling us to invest in our project pipeline that we’ve got,” he said.
“So our aim is to increase our revenue streams and shareholder value by owning and operating the infrastructure we build, own and operate.”