Environmental Clean Technologies Limited (ASX: ECT) (ECT or Company) is pleased to provide the following update.

Key points:

• Personnel changes:
  • Resignation of CFO & Company Secretary
  • Appointment of Company Secretary
• Coldry Upgrade Project status update

Personnel Changes

Resignation of CFO & Company Secretary

The Company advises that its current Chief Financial Officer and Company Secretary, Mr Martin Hill has resigned, effective at the end of September 2020.

This personnel change provides an opportunity to better align the finance role with a focus on management accounting and project cost control in support of the Coldry upgrade project.

The Company Secretary role will transition, effective immediately.

The Directors thank Martin for his service and look forward to his continued contribution toward the success of the business during the transition period.

Appointment of New Company Secretary

The Company is pleased to announce the appointment of Mr Adam Giles as Company Secretary of the Company and its subsidiaries effective immediately.

As a founding shareholder, Adam has been with the Company since its inception and previously held the role of Company Secretary from December 2012 to December 2017.

Adam continues his current role of Marketing and Communications Manager.

Coldry Upgrade Project – Status Update

On 18 June 2020, the Company announced its return to normal operations and the commencement of its focal activity for the coming year; the Coldry upgrade project.

Comprised of capacity improvements to the former Coldry pilot plant and the addition of new plant and equipment to produce high-value energy products like char and solid fuel, the project constitutes a commercial demonstration of the Company’s proprietary low rank coal drying technology, aimed at delivering project objectives and monetising the Company’s existing assets.

Consistent with the Company’s strategic plan (4 September 2019), successful completion of the project objectives is expected to enable commercial outcomes via the sale of solid fuel and char product. With the potential to generate revenues exceeding $5 million per annum delivering up to $3 million a year in net cashflow, successful achievement of the project objectives will support the ongoing research, development and commercialisation of the Company’s suite of technologies.

The R&D objectives of the project include:

• Scale up from Coldry pilot scale
• Integration with waste heat application, being a char kiln, to provide drying energy for the Coldry process:
  • Utilisation of syngas produced from the char kiln
  • Recovery and utilisation of waste heat from the char kiln
• Production of solid fuel Coldry pellets, to target specification
• Production of char from solid fuel Coldry pellets, to target specification

Site Layout & Basic Design Completed

During the ‘Business Continuity Plan’ period during the initial COVID-19 lockdown the engineering team focused on:

• Development and refinement of site layout options
• Development of the basic design
• Development of tender packages
• Project plan revisions

The site layout and basic design were the first milestones to be completed following the return to normal operations, followed shortly thereafter by the issue of the first major process package tender and the commencement of site activities in preparation for construction.

The site layout and basic design features a compact site footprint built on a closely integrated process flow allowing the optimised use of space.

Originally built on the site of the former CRA fibreboard manufacturing plant, the Coldry pilot plant has undergone several iterations. Through each pilot development phase, the Company has leveraged legacy infrastructure, including in-ground hoppers, building structures and conveyors, electricals mains and storage area to provide a cost-effective basis upon which to conduct its research and development work. This approach is appropriate during pilot development as the intent is to generate new knowledge and it is not anticipated to achieve commercial operation.

Chief Engineer, Mr Ashley Moore commented, “The initial approach of utilising existing infrastructure on site worked well to balance cost against research and development objectives.

“However, we’re excited to unveil the new layout which features an increase in minimum design capacity of our Coldry technology to 25,000 tonnes per annum, from a much smaller site footprint.

“The new plant will be built around the existing packed bed dryer, avoiding the need to move the largest piece of the existing plant, while also allowing for the efficient positioning of the primary processing train and integration with the char kiln.”

The following images illustrate the proposed site layout and basic design.

Process Package Tender Issued

In addition to the completion of the site layout and basic design, the first of the major process package tenders has been issued, with several more to follow in due course.

Following the completion of the tender process, the Company will have refined plant, equipment and componentry parameters, enabling the final detailed, integrated design drawings to be completed and construction of the upgrades to commence.

Site Preparation Commenced

Site construction preparation activities have commenced and will advance ahead of the arrival of the range of equipment packages, currently scheduled to commence during September 2020.

To achieve the optimal layout, the new design will see the primary processing train and conditioning system housed adjacent to the packed bed dryer in an area of the existing building which has been home to the Matmor and HydroMOR test plant. This requires the dismantling and relocation of the HydroMOR plant, which will commence next week, clearing the way for the installation of the Coldry upgrades.

Chairman Glenn Fozard commented, “We are pleased to have finalised the site layout and basic design and be well underway with our supporting preparations ahead of construction. Next week will mark a significant step up in site activity with the following personnel in place to support this next step, including:

• Ashley Moore – Project manager
• Glenn Fozard – Site supervisor
• Scott Vagala – Site warden & work health and safety representative
• Daniel Hughes – Construction manager
• Josh Doherty – Electrical supervisor
• Grant Williams – Logistics adviser

“Entering the construction phase of the project will likely see the addition of 10+ jobs as we build a diversified energy plant that will hold the status of an essential industry at a time when Victoria and the local community is suffering the growing impact of the biggest economic recession in generations.”

COVID-19 Impacts

The Company notes the ongoing increase in daily COVID-19 cases in Victoria and continues to assess the actual and potential impacts on the business generally and the Coldry upgrade project specifically.

In general terms, the Company continues to operate under health authority directives, including:

• Staff to continue work from home, where possible
• Hygiene and health protocols, including hand washing, mask wearing, regular cleaning and social distancing
• Install and run the COVID-19 app on staff smart phones

With regard to the Coldry upgrade project specifically, the Company has assessed the current stage 3 and potential stage 4 restrictions and determined that the project will continue as intended as it falls under the definition of essential or critical services, given site activities  fall under the categories of construction, mining and energy.

In addition to the abovementioned general precautions, employees and visitors to the project site will be required to undergo COVID-19 Safe induction requirements like temperature checks and hand sanitisation.

There continues to be a broad level of uncertainty around the potential impact on the ability of suppliers to meet delivery timeframes for certain plant and equipment elements, although no indications of this causing any delays has been made clear to ECT at this stage. The Company will continue to closely monitor this potential impact and provide revised updates to timeframes over the course of the construction period.

ECT looks forward to providing regular updates as the project proceeds.

For further information, contact: Glenn Fozard – Chairman [email protected]