Velocys raises $33M to up manufacturing capability and advance 2 fuel projects

In the United Kingdom, Velocys PLC has raised £25 million ($33 million) through a Placing with institutional investors at 8 pence per share, with a potential further £2M through an Open Offer. The funds will be used mainly for capital investment in manufacturing capability, advancement of two projects including Bayou Fuels in Mississippi and Altalto in Immingham, UK, and more.

Jeff McDaniel, VP New Projects at Velocys, told The Digest, “We are very pleased with this demonstration of institutional investors’ confidence in our company, our strategy and our business opportunity. It allows us to get on with building our capabilities and to move our projects forward.”

To quote from the circular, the net proceeds of the Fundraise will be used primarily for:

• Capital investment in the current manufacturing capability to enable output of at least 12 reactors per year;
• Funding to advance the two reference projects (Bayou Fuels in Mississippi, US and Altalto in Immingham, UK) to the point of securing external investment into the detailed engineering stage;
• Setting aside funds to back process guarantees and equipment warranties to clients;
• General working capital needs over the next 24 months, including the potential part-payment to secure control of the site for the Altalto project; and
• Providing a line of sight to achieving net positive cash flow during 2024.