Graphene Nanochem: Palm Oil, Biodiesel, or Graphene?

In an earlier article titled “Investing in Graphene“, we noted that there are few opportunities for public investors to invest in this exciting new material. In another article, we also highlighted a company called Graftech which does not appear to be the graphene pure-play many discuss it to be. There is, however, a little known UK company that claims to have a low-cost method of producing graphene from natural gas or bio-methane.

Graphene_NanoChem_Logo

Graphene Nanochem was formed in March 2013 through the reverse merger of two companies; Biofutures International and Platinum Nanochem. This newly formed entity then floated on the London Stock Exchange in March 2013 with the share price having performed very poorly since the float leaving the company with a present-day market cap of 143 million USD.

GRAPH_Chart

Biofutures International PLC (BIP)

BIP  is a company that refines palm oil. A statement taken from BIP’s website on the company strategy is as follows:

BIP was first floated on the AIM Market in the UK with the intention of investing in the manufacturing of biodiesel derived from palm oil (“Biodiesel Project”). Market conditions began to change rapidly and adversely against the whole biofuel industry and challenged the viability of the Biodiesel Project prior to its full implementation by Zurex. The Group’s current strategy is to proceed to set up a plant for the refining of palm oil in Lahad Datu, Sabah, Malaysia. and to maintain the flexibility to produce biodiesel should it become economically viable to do so.

The newly formed company, Graphene Nanochem, reports their 2012 revenues in GBP as seen below:

Graphene_NanoChem_Revenues

It would appear that the financials from both of these merged entities have not yet been consolidated and that Biofutures relies almost solely on the refining of palm oil for revenues. In this same report, the following statement is made:

In 2012, the utilisation of the Biofutures group’s refinery was limited to less than five per cent.

This extremely low utilization was attributed to a pronounced slump in the Malaysian palm oil refining industry in 2012.

Platinum Nanochem

According to Graphene Nanochem’s new website, the following statement is made about Platinum:

In 2011, the Platinum Group started servicing the local fuel additives market, supplying to three Tier-1 oil and gas companies from Platinum Nanotek Park I located in Senawang, West Malaysia before expanding its market into the EU in 2012. In 2011, Platinum NanoChem initiated the commercial production of graphene nanomaterials at Platinum Nanotek Park I and focused on developing applications of graphene in high performance chemicals.

In looking at Platinum’s website, it appears they produce a biodiesel product called PlatAmber. A press release this month announced that Platinum NanoChem has been awarded a three-year contract with Chevron Malaysia for the supply of PlatAmber, the group’s biofuel product derived from palm waste for the Malaysian market.

Platinum also provides a technology referred to as the Catalyx Process which enables the low-cost mass production of graphene nanomaterials through a chemical synthesis process.

Business Lines

There appears to be three revenue streams produced by these two merged entities; palm oil refining, graphene production, and biodiesel production. These three business lines may have synergies. When the financial statements from both these entities are consolidated so that investors can see what revenues are derived from each of three business lines, it will become much more clear to what extent Graphene NanoChem is a play on the graphene story.

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