Turning wastewater into gold, Parkway achieves record FY23 cash receipts

Parkway Corporate has released its June quarterly report confirming record cash receipts for FY23 whilst it works to solve the enormous wastewater challenges facing the coal seam gas (CSG) sector.

Parkway Corporate (ASX:PWN) has 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.

PWN says group sales were underpinned by a significant project backlog, including more than $1 million in open purchase orders issued to the company, which are expected to be recognised once project activities have been finalised and invoiced.

The company is having ongoing success in securing new business from a diverse range of clients for industrial water treatment related products, services, and solutions, providing further support for ongoing sales growth.

However, PWN says its core focus is building its strategic position and tech-focused projects rather than non-strategic, short term revenue generation.

PWN releases master plan to crack CSG code

PWN is primarily focused on building an advanced water treatment technology company.

The Parkway Process Technologies (PPT) division, focuses on developing cutting-edge solutions for complex wastewater and process streams, particularly in the Queensland CSG sector.

CSG extraction produces large volumes of highly saline water, known as brine, as a by-product.

PWN’s proprietary technologies are able to tackle this challenge by recovering fresh water from toxic waste brines and converting the waste salts into valuable industrial chemicals for use in the Queensland market.

During the quarter PWN’s master plan was released, aligning with Queensland Government legislation that emphasises converting waste into usable products to reduce disposal requirements.

Over the life of currently operating CSG projects in Queensland, ~6 million tonnes of waste salts are expected to be produced.

A significant proportion of these salts have already been produced, in the form of waste brine and are currently being stored in waste brine storage ponds, awaiting a viable long-term disposal (or processing) solution.

Recognising the significant challenges, PWN has been working to systematically develop a portfolio of proprietary process tech to specifically address the waste brine and salt challenges facing the CSG industry.

That involves extensive process optimisation, piloting and techno-economic evaluations, providing a high level of confidence in the value proposition, particularly in comparison to the industry’s planned approach.

Managing director Bahay Ozcakmak says the landmark master plan outlines a transformational opportunity for PWN to provide an industry-wide solution.

Given the scale of various strategic opportunities in the CSG sector, PWN has recently established a subsidiary, Queensland Brine Solutions Pty Ltd (QBS), to drive commercialisation efforts and advance objectives of the master plan.

Ozcakmak says following the plan’s release PWN actively engaged with various stakeholders, including industry, government, strategic partners, and the investment community.

“The response has been extremely positive and well-received, reinforcing the company’s confidence in its overall strategies,” he says.

Independent Investment Research (IIR) recently flagged that PWN’s innovative tech for treatment of CSG brine could become best available technology (BAT), which would provide a solid financial uptick for shareholders.

IIR has a risked base case valuation of $0.083 per share, around an eight-fold increase from its current price.

READ: Analyst reckons Parkway has potential to be a 50-bagger

New upstream brine concentration and beneficiation tech

PWN has been focusing on developing transformative CSG brine processing technologies, mainly centred on downstream system optimisations that replace conventional brine concentrators and salt crystallisers with their proprietary process train.

While this downstream approach applies to major CSG projects in Queensland and yields significant outcomes, PWN also recognises potential for a complementary upstream system optimisation.

Considering that existing water treatment plants in three of the four major Queensland CSG projects generate relatively dilute waste brine stored in ponds, adopting an upstream brine concentration and beneficiation process would offer substantial benefits.

PWN has recently achieved successful development of a new upstream technology package, incorporating various innovations and leveraging their core intellectual property.

This package has undergone process development, bench-scale piloting, engineering studies, and is currently being scaled-up for near-term commercialisation in line with their master plan objectives.

Ozcakmak says by implementing the new upstream technology, PWN not only paves the way for downstream processing but also reduces costs associated with constructing and maintaining brine storage ponds. Moreover, it offers a cost-effective brine dewatering option for the industry.

He says there is significant opportunity to provide near term solutions based on its new upstream technology, with strong regulatory and stakeholder support and engagement progressing positively.

Broader opportunities beyond Sunshine state

PWN’s technology portfolio has broader applications for the treatment of a range of complex industrial wastewater streams including brines, as well as acid and metalliferous drainage (AMD).

The company’s Parkway Process Solutions (PPS) division operates as a conventional water treatment business, offering equipment, services, and integrated solutions, and whilst this division is also experiencing growth, the objectives of this business are intended to provide a launchpad for the PPT division.

In its quarterly report PWN says the potential suitability of its portfolio of innovative process technologies across several significant mining projects is currently being considered by a major global mining company.

PWN is also collaborating with global engineering company Worley, in relation to several mining related opportunities, involving the production of critical minerals, as well as the potential treatment of complex wastewater streams, through proprietary process technologies developed by PPT.

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.