Quadrise posts progress with Utah partner Valkor

The AIM-traded firm said that after its announcement on 3 October, Valkor confirmed that its project partner Heavy Sweet Oil (HSO) had secured multi-million dollar funding and approval for their application for permit to drill (APD) from the Utah Division of Oil, Gas and Mining.

Valkor was set to start drilling the initial oil well at Asphalt Ridge in Utah next week, with completion expected by the end of April.

Set to yield between 20 and 40 barrels per day of heavy sweet oil, samples from the well would be treated to remove impurities and sent to Quadrise for conversion to MSAR and bioMSAR for testing.

Commercial marketing to marine, utilities, and industrial sectors was projected to begin before the end of the second quarter, following testing.

In support of the drilling programme, HSO was planning to submit further drilling and underground injection control permit applications for steam injection to enhance recovery with optimised well spacing.

Approval of the applications would enable multiple wells to be drilled from the same pad, enhancing the oil field unitisation application for approval of the larger project.

Quadrise said Valkor oversees several conventional oil sands and drilling exploration projects in Utah.

With initial drilling funded for three to four wells, they anticipated securing full project financing and approvals by mid-2024.

On raising a minimum of $15m project finance, Valkor would pay Quadrise $1m per the terms of the site licence and supply agreement concluded in June last year.

Additionally, a further $0.5m was due on delivery of an MSAR manufacturing unit to the project site in Utah, followed by quarterly technology transfer payments of $75,000.

“We are delighted to see that Valkor has reached another operational milestone and look forward to the commencement of their drilling operations and the receipt of new heavy sweet oil samples for testing at the Quadrise Research Facility,” said chief executive officer Jason Miles.

“The adoption of Quadrise energy decarbonisation technology combined with Valkor's low carbon extraction methods is expected to result in highly marketable low sulphur fuels with compelling economics and environmental credentials.”

At 0838 BST, shares in Quadrise were up 2.73% at 1.44p.

Reporting by Josh White for Sharecast.com.