Investor News

Quarterly Activity Report & Appendix 4C

UPDATE 27 JULY 2021: Environmental Clean Technologies Limited (ASX: ECT) (“ECT” or “Company”) recently provided (23 June 2021) the following update for the quarter ending 30 June 2021.

The replacement provided to the ASX today contains two amendments.

The Activity Report now includes the following statement:

“Payments of $138K to related parties of the entity include payments for directors’ fees to executive and non-executive directors, and payments to executive directors for consulting fees.”

The Appendix 4C now includes the following information (item 7.6):

“The Company’s lending facility is from RnD Funding Pty Ltd. Interest is 12% per annum, the facility is secured, matures 31 December 2022 and is fully drawn at $1.2M.”

23 July 2021: Environmental Clean Technologies Limited (ASX: ECT) (“ECT” or “Company”) is pleased to provide the following update for the quarter ending 30 June 2021. During the period, the Company continued to advance construction of the Coldry Upgrade Project (“Project”) at Bacchus Marsh, Victoria.


  • Coldry Upgrade Project progresses with Phase 1 construction well advanced and on target for completion during Q1FY22
  • Acquisition of rotary kiln – key component for Phase 2 char project
  • Coal supply agreement executed with EnergyAustralia
  • Adoption of formal Environmental, Social and Governance (“ESG”) framework
  • EGM approving capital raising, amended Constitution and the consolidation of share capital on 10 to 1 basis
  • $3.5M capital raising to assist funding the Project at Bacchus Marsh and other opportunities, nearing completion
  • Appointment of Euclase Capital as Corporate Advisor

Coldry Project Activity

Coldry, ECT’s core technology, is a zero-emission, cost-effective lignite drying process, that significantly reduces low-rank coal's moisture content creating the ideal feedstock for high-value downstream applications including char, syngas, fertiliser and hydrogen.

Construction of the small-scale, zero-emission Coldry lignite drying technology at Bacchus Marsh progressed well over the quarter with the Company completing:

  • Installation of the hammer mill, surge hopper and supporting structures
  • Genset installation to power the workshop and laboratory
  • Assembly of the packed bed dryer panel box
  • Fabrication of the conditioning system
  • Installation of Motor Control Centre 01

The Company also announced the acquisition of a rotary kiln, a key Phase 2 component of its Coldry-enabled char project. The total cost of the acquisition (including transport) is estimated to be $300,000 and is anticipated to deliver savings of up to $500,000, reducing Phase 2 lead time by up to four months.

Further updates on the progress of the Project will be announced in due course.

Coal Supply Agreement with EnergyAustralia

During the quarter, ECT signed a 5-year coal supply agreement with EnergyAustralia, the owner of the Yallourn Power Station (“Yallourn”) in Victoria’s Latrobe Valley, for the supply of lignite for the Company’s Coldry-enabled char project. Yallourn provides 22% of Victoria’s electricity and approximately 8% of Australia’s National Electricity Market.

The agreement, which includes the repair and recommissioning of the outfeed delivery system at Yallourn (pictured below), will enable the Company to access up to 50,000 tonnes per annum of lignite for exclusive use in ECT’s Coldry facility at Bacchus Marsh.

Successful completion of the small-scale commercial demonstration plant at Bacchus Marsh, and the repair and recommissioning of the lignite terminal at Yallourn, is part of ECT’s broader commercialisation strategy which involves the further potential scale-up of the Coldry process in Victoria’s Latrobe Valley in support of the higher value, lower emission utilisation of lignite via a range of downstream applications.


Adoption of ESG Framework

The Company adopted a formal ESG reporting framework during the quarter, initially establishing the Company’s baseline measurements in areas regarding, Environment, Social and Governance. The baseline ESG report is included below, and updates will be provided on an ongoing basis in alignment with the Company’s 4C quarterly reporting to the ASX.

Quarterly ESG Report for ECT Ltd

Environmental, Social, and Governance (ESG) is disclosed against the World Economic Forum universal ESG framework and reported on a quarterly basis using Socialsuite ESG Go. The June 2021 quarter ESG Go Dashboard report is included below.

‘ESG Go’ Dashboard for ECT

Extraordinary General Meeting

The Company held an Extraordinary General Meeting (“EGM”) on the 25 June 2021, approving (amongst other matters) an amendment of the Company Constitution as well as a 10 for 1 share consolidation of issued capital. The share consolidation was effective as of 25 June 2021, resulting in 1,183M issued shares.      

Capital Management

Approximately $1.3M (prior quarter $732K) was spent on the Project during the quarter on eligible research and development (“R & D”) expenditure that will qualify for the ATO’s R & D incentive. Of this amount, $1.2M (prior quarter $399K) was attributable to property, plant and equipment purchases with the remaining $100K (prior quarter $333K) on other R & D project expenses.

During the quarter, the Company received a further two drawdowns of the loan secured by the Company’s R & D tax incentive rebate of $900K bring total borrowings to $1.2M.

The Company received a total of $1.89M (prior quarter nil) from capital raising activities during the quarter. Of this amount, $1.5M was from a share placement and $388K was from a share purchase plan.

Administration and corporate costs increased by $379K compared to the previous quarter. This increase was spread across various expenses including legal fees, capital raising costs, share registry costs, ASX fees, consulting fees and patents. Other cash inflow and outflow categories were comparable to the previous quarter. As such, and notwithstanding the items mentioned above, the Appendix 4C is not materially different to the prior quarter.

Payments of $138K to related parties of the entity include payments for directors’ fees to executive and non-executive directors, and payments to executive directors for consulting fees.

Cash on hand at the end of the quarter was $1,014K compared to $233K at the end of March 2021. Cash on hand as at the date of this report is $520K. A GST refund of more than $300K is expected in the coming week and the Company tax return will be lodged shortly which will include the R&D tax offset rebate, which after paying out the R&D loan facility in its entirety, should net the Company approximately $700K.

In the next few weeks, the Company expects to complete the placement of the shortfall from the recent capital raising. This is expected to raise up to an additional $1.6M. The Company also expects to raise a further $500,000 from the shares allocated to the project and held under custodian. These custodian shares already make up the existing free float on the market and will not dilute shareholders any further.

As at the date of this announcement, the Company has no undrawn loan facilities. In the coming weeks, the Company will seek to enter into a new loan agreement for a facility comparable to the 2020/21 facility. This facility will be secured by the Company’s R&D tax incentive credit and is expected to allow the Company to draw up to $1.5M over the 2021/22 financial year.

Corporate Advisor

ECT appointed Euclase Capital as its Corporate Advisor (“Euclase”). Euclase will provide a range of services to the Company, including advice on strategic and cornerstone investors, advice on potential offtakers, assisting with the development of feasibility studies with a view to securing project finance for ECT’s projects, and advising on business and corporate development opportunities.

For further information, please contact:

Glenn Fozard
[email protected] / +61398496203

Adam Giles
Company Secretary
[email protected] / +61398496203