• Parkway Corporate raises $4 million in oversubscribed placement
  • Strong support from new investors and existing shareholders, including US based cornerstone investor
  • Funds raised will advance commercialisation CSG wastewater recycling technology

 

Parkway has raised $4 million in an oversubscribed placement with investors getting behind the company which is working to solve the enormous wastewater challenges facing industry, including in the coal seam gas (CSG) sector.

Leading industrial water treatment technology company Parkway Corporate (ASX:PWN)  has received firm commitments to raise $4 million via the placement of 285,714,286 shares at 1.4 cents/share.

The placement was initially targeting $3 million, with PWN agreeing to accept $1 million in oversubscriptions, resulting in the placement being upsized to $4 million.

Managing director Bahay Ozcakmak says local and overseas institutions, professional and sophisticated investor have taken part in the placement, including a cornerstone investor from the US.

“We are particularly pleased a US based strategic investor has agreed to increase its interest in Parkway, by providing cornerstone support for the capital raising,” he says.

Funds raised will be used to advance a range of strategic growth initiatives, including those outlined in its recently unveiled Master Plan, and provide general working capital.

“Proceeds from the capital raise will enable PWN to continue to expand its internal  capabilities, including in relation to the modularisation, fabrication, and integration of its key process technologies,” Ozcakmak says.

“Building these internal capabilities is a crucial step in the commercialisation journey and will also provide us with a platform for deploying our technologies in other high value applications, particularly in the resources sector.”

Settlement of the new shares, which will rank equally with existing shares, is expected to occur on August 29 with no options issued as part of the placement.

 

Targeting Queensland CSG sector

PWN is an advanced water treatment technology firm with four businesses: Parkway Process Solutions (PPS), Parkway Process Technologies (PPT), Queensland Brine Solutions (QBS) and Parkway Ventures (PV).

The recently unveiled Master Plan is being advanced by Queensland Brine Solutions (QBS), dedicated to creating innovative solutions for intricate wastewater and process streams in the Queensland CSG sector.

CSG extraction generates substantial amounts of brine, a highly saline water, as a secondary product.

PWN’s tech reclaims fresh water from hazardous waste brines and transforms the residual salts into valuable industrial chemicals for utilization in Queensland’s market.

PWN master plan was released in June and aligns with the Queensland Government regulations that emphasize converting waste into usable goods to minimise disposal demands.

Following the plan’s release, PWN has actively engaged with multiple stakeholders, including industry partners, governmental entities, strategic collaborators, and the investment community.

Across the duration of ongoing CSG projects in Queensland, an estimated 6 million tonnes of waste salts will be generated.

A notable portion of these salts has already materialised as waste brine and is presently stored in waste brine storage ponds, awaiting a feasible long-term disposal or processing solution.

Confronting these significant hurdles, PWN has diligently cultivated a collection of proprietary process technologies to specifically target the waste brine and salt issues within the CSG sector.

The approach encompasses thorough process refinement, testing through pilot projects, and comprehensive techno-economic assessments, instilling confidence in the value proposition, especially when contrasted with the industry’s planned strategy of salt disposal.

Whilst the Master Plan is an ambitious long term plan, PWN has identified an initial market opportunity where it believes QBS could potentially build up to 24 systems to provide an industry wide upstream brine concentration solution on a toll-treatment basis for the Queensland CSG sector.

In a commissioned report, Independent Investment Research (IIR) recently flagged that Parkway’s innovative tech for treatment of coal seam gas (CSG) brine could become best available technology (BAT) with a solid financial uptick for shareholders.IIR has a risked base case valuation of $0.083 per share, a 10-fold increase on the Parkway Corporate (ASX:PWN) price of $0.008/share at the time, making it a potential 10-bagger, with further upside in an unrisked scenario.The share price has since increased 75% to 1.4c. You can read the report in full on PWN’s Investor Hub.

 

Solid revenue growth in FY23

PWN reported a solid Q4 FY23 generating ~$1.09 million in sales and achieving strong cash conversion with record quarterly cash receipts of $1.32 million contributing to record annual receipts of $4.69 million for the financial year.

The company last raised ~$5.25 million through a placement to sophisticated and professional investors back in January 2021.

Ozcakmak says at the time PWN was very much in its infancy without any operating  business, plant and equipment, inventory, or any form of revenue generation.

“We have subsequently built a focused team, established a growing operating business with tier-1 clients and continued to make significant progress towards the commercialisation of our proprietary process technologies,” he says.

“In relation to technology commercialisation, earlier this year we announced the completion of a landmark feasibility study for a leading global energy company, based on our proprietary brine processing technologies.”

Ozcakmak says the evaluations remain ongoing. However, encouraged by its ongoing achievements, including various technology breakthroughs, shortly after completing the feasibility study PWN expanded its target market for its CSG brine processing technologies to the entire CSG industry in Queensland, through the master plan.

“More recently, we announced we were also pursuing smaller upstream prospects as part of our master plan related objectives,” Ozcakmak says.

“These upstream prospects not only provide near-term opportunities for our brine processing technologies but are also of a scale which Parkway could reasonably execute and own, potentially enabling us to create and capture significant value.

“We believe this specialised application of our key process technologies, provides Parkway with an opportunity to systematically build a significant operating business in Queensland.

While PWN is currently focused on the Queensland’s CSG sector, it is concurrently evaluating potential applications for its process technologies with several global mining companies.

“Mining more broadly represents significant opportunities for PWN, and is a sector in which we expect to be able to capture some significant project opportunities over time through our modular systems,” Ozcakmak says.

 

This article was developed in collaboration with Parkway Corporate, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

 

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