Re-listed junior Frontier Energy (ASX: FHE) has unveiled a pre-feasibility study for low-cost green hydrogen production, after debuting on the US OTCQX market earlier this week.
Frontier’s presence on the OTCQX is aimed at enhancing its visibility and accessibility to North American investors and allow them to trade and settle in US trading hours and dollars.
It will trade under the ticker code ‘FRHYF’.
Highest market tier
The OTC is an established trading platform operated by OTC Markets Group in New York, and provides live market trading in companies which hold primary listings in other markets.
It is considered to be highest market tier of OTC (over the counter) exchanges, on which more than 10,000 US and global securities trade.
Eligibility for the OTCQX requires a demonstration of high financial standards, best practice corporate governance and compliance with US securities law and disclosure obligations.
Trading of Frontier shares on the OTCQX imposes no additional compliance or regulatory standards to the company’s existing compliance requirements with the Australian Securities Exchange.
OTCQX trading is non-dilutive to existing Frontier shareholders, as no new shares are being issued to enable trading.
Frontier executive chairman Grant Davey said the OTCQX would give Frontier timely exposure to the US investment market.
“North America provides the world’s largest pool of investors and from my experience, OTC is the simplest and most cost-effective way for them to buy shares in their own time zone and currency,” he said.
“With a number of [our] key studies nearing completion at a time when the world needs renewable energy solutions more than ever before, this is promising to be an exciting year for Frontier.”
Formerly known as Superior Lake Resources, Frontier Energy re-listed on the ASX in March with a new leadership team and a new business strategy focused on the growing clean energy sector via its flagship project the Bristol Springs solar farm in Western Australia’s South West.
Its listing followed an $8 million oversubscribed capital raising to fund development of Bristol Springs.
Prior to its transition to clean energy, the company divested its Superior Lake zinc project in Canada to Metallum Resources.
Green hydrogen study
A pre-feasibility study released today for Bristol Springs shows it has the potential to be an early-mover, low-cost green hydrogen producer.
The power will be sourced from the company’s stage one (114 megawatt) solar farm which could power a 3.6MW alkaline electrolyser to produce 4.4 million kilograms of green hydrogen per annum.
The capital cost estimate for the solar farm is $166.3 million, while establishing the 36.6MW electrolyser will cost about $69.9 million.
Including the estimated capital outlay, the study forecasts a total unit cost of $2.83/kg of hydrogen produced.
According to Frontier, this cost places the project as one of Australia’s lowest cost green hydrogen producers.
The low cost is largely driven by the project’s location, which utilises major existing regional infrastructure to help keep development costs down.
This includes connection to the Landwehr Terminal power line, allowing for excess solar renewable energy to be sold via WA’s main energy grid known as the South West Interconnected System.
The project also has access to existing water sources meaning there is no requirement for capital-intensive infrastructure such as desalination.
Frontier said initial hydrogen production would be sold into Australia’s domestic market while offtake customers are expected to come from the long-haul transportation, gas pipeline and energy storage industries.
Discussions have commenced with potential hydrogen offtake parties.