Active Energy announced Friday that recent discussions with Player Design (PDI) regarding the delayed construction of a biomass fuel production facility in Ashland, Maine have been unproductive.
PDI informed Active Energy that they could no longer commit to a future production date or volume target for the CoalSwitch fuel to be produced at the Ashland facility. Active Energy has contributed $1.1 million in cash and $1.5 million in equipment towards the project and is now seeking the return of these funds.
Investors baulked at the news and Active Energy shares were down over 70% at the time of writing on Friday.
While disappointed with the construction delays, Active Energy said they remained confident in market demand for its CoalSwitch biomass fuel and is evaluating options to commence production in North America or Southeast Asia using its proprietary technology.
This will be of little consolation for investors looking at 89% decline in the share price over the past year.
Michael Rowan, CEO of Active Energy, commented on the developments:
“The actions of PDI are as surprising as they are disappointing after a long journey toward the production of CoalSwitch® fuel, especially given the fact that Tyler Player is a shareholder of Active Energy. The Board is taking swift and decisive action in the interests of our shareholders to minimize the impact, and to actively investigate and pursue all available claims arising from Active Energy’s dealings with PDI over the last 3 years. Shareholders should be rest assured that we are taking all the necessary steps to protect Active Energy’s current and prospective interests.
“Based on the continuing strong product interest from potential customers, the Board is confident in the significant future commercial opportunities for CoalSwitch® fuel, notably both in North America and Vietnam, and is encouraged by the ongoing discussions and evaluations currently being undertaken by several alternate commercial production partners. The shareholders will be updated with these developments at the earliest opportunity.”
