Breakthrough: Electrochemical Process Transforms Waste Brine into Valuable Industrial Chemicals

The Australian cleantech company specializing in industrial wastewater, Parkway Corporate (ASX: PWN; FRA: 4IP), has presented another compelling quarterly result as of September 30, 2024. Once again, the company has succeeded in connecting its growing operational business (Industrial Operations) with its diverse strategic initiatives and investments in wastewater technology (Industrial Technology). In particular, the implementation of the so-called master plan for the CSG industry is taking increasingly concrete shape. New is the plan for a central upstream facility that could process up to half of the waste brine produced by the CSG industry in Queensland. Parallel to the planned central upstream facility, Parkway has also identified a strategically favorable downstream project site for the planned downstream facility within an established industrial area in Central Queensland.

In the September quarter (FY25-Q1), Parkway generated group operating revenue of approximately $4.04 million, compared to $1.29 million in the corresponding period of the previous year (FY24-Q1), representing an increase of 213%. During the reporting period, the company recorded cash receipts of $4.91 million AUD, which also marks a new record. Operationally, the transition to profitability is becoming apparent.

Parkway’s Industrial Operations business segment is growing: Parkway is increasingly involved in the turnkey planning, manufacturing, and installation of complex water and wastewater-related infrastructure. In many cases, Parkway is one of only a few experienced service providers capable of delivering specialized solutions for critical water-related infrastructure in key markets. Parkway continues to view the growth prospects for the Industrial Operations division as very encouraging. Parkway has a substantial project portfolio as well as an extensive pipeline of project opportunities, particularly in Victoria. The water authorities there plan to invest 15 billion AUD in water-related infrastructure over the next five years. As a nominated supply partner, Parkway is well-positioned to capitalize on these opportunities.

Breakthrough: Electrochemical Process Transforms Waste Brine into Valuable Industrial Chemicals

One of the highlights of the quarter was a significant breakthrough in the self-developed brine technology. After a series of optimization studies, the company has succeeded in converting waste products from salt into industrially valuable caustic soda and hydrochloric acid through electrochemical processes in pilot tests. Parkway believes that these successful pilot results represent the first production of a mineral acid from an Australian waste brine.

Parkway reports significant progress on strategic coal seam gas brine projects (CSG industry) in Queensland during the reporting period. The selection of project sites in connection with the so-called master plan for a circular economy for the CSG industry in Queensland is progressing. The main objective of the QBS master plan is to utilize the process technologies developed by Parkway to convert CSG-derived waste brine and salts produced in Queensland into valuable industrial chemical products. Parkway’s MD, Bahay Ozcakmak, will provide further details on the go-to-market strategy and progress in selecting future sites for upstream and downstream processing facilities at the upcoming Annual General Meeting on November 27.

The recently elected LNP Queensland government supports the growth of the CSG industry, which is an important location factor. According to estimates by Australian Energy Producers, the CSG industry in Queensland generated around $22.4 billion in LNG export revenue and $2.4 billion in local and state government revenue in fiscal year 2024, highlighting the size of the industry.

Central Upstream Facility Offers Effective Path to Industry-Wide Solution for CSG Waste Brine

The Parkway management is convinced that recent improvements have enabled the company to find an even more effective way to provide an industry-wide solution for the challenges associated with waste brine and salt in the CSG industry. In the new process scheme, the initial brine concentration (Stage 1) at the upstream CSG customer site is concentrated approximately 3 to 4 times to produce a Stage 2 brine that is much cleaner and better suited for further processing. This Stage 2 brine is then transported to a central upstream QBS facility where the brine is further processed and concentrated an additional 2-3 times, creating a highly concentrated brine stream (Stage 3) that accounts for about 10% of the initial volume, illustrating the extent of volume reduction.

Previous upstream plans were predominantly based on extensive on-site processing before two separate concentrates would need to be transported to central hubs. Due to several recent process innovations and optimizations, the type of upstream facility proposed for upstream CSG customer sites has been significantly simplified, offering a range of operational benefits as well as improved financial performance.

The planned central facility for upstream processing is expected to have a nominal capacity sufficient to process up to half of the waste brine generated by the CSG industry in Queensland. Parkway has recently signed several memoranda of understanding, including with companies that have project sites suitable for accommodating the planned central upstream facility, and is in the process of examining options for long-term leases that would support the development of the central upstream facility.

Location for Planned Downstream Hub Identified and Secured

The planned downstream hub is intended to convert all brine and/or salts from the QBS Central Upstream Plant(s) into a range of valuable industrial chemicals, including hydrochloric acid and caustic soda. Parkway has recently signed a memorandum of understanding with an industrial-scale project developer regarding the potential co-location of the planned downstream hub on the developer’s existing project site. Parkway anticipates that the innovative process technologies developed by Parkway will, over time, become BAT for the treatment of CSG brines in Queensland.

Given the highly strategic importance of the planned central upstream facilities and downstream hub for key industry participants, Parkway expects to be able to sell equity in its subsidiary Queensland Brine Solutions (QBS) at the level of a project-specific special purpose vehicle to finance the development costs.