Wasabi Energy

Wasabi invests in companies and projects which it believes can provide solutions to global sustainability challenges. We actively participate to help achieve critical business milestones, finance growth and deliver results that matter.

Wasabi aims to become a major, profitable, energy and clean technology company, building on an established platform of strategic investments in the power technology and water conservation areas.

Wasabi were recently featured on Creamer Media's Engineering News.

Statement by John Byrne - Executive Chairman:

In this financial year Wasabi Energy focused on the further market penetration of its three core businesses – renewable power generation, sustainable and secure water supply and biodiesel from renewable resources.

The core businesses operated through three separate companies, Global Geothermal Limited (GGL), a subsidiary which owns the global patents and intellectual property for the Kalina Cycle® power generation technology, Aqua Guardian Group Ltd (AGG), a 47.5% Wasabi owned water technology company with a patented product for water conservation, and Australian Renewable Fuels Ltd (ARW), an Australian Stock Exchange listed company with 17.33% Wasabi ownership, and which has Australia’s largest capacity for biodiesel production.

A highlight for the year was the appointments to two key management positions – a Chief Operating Officer and President International. These appointments have helped the business gain further momentum and discipline through improved business processes. The Wasabi Energy management team is actively involved in each of its core businesses. Each business has met major milestones this year that will underpin their operations and continue to build the businesses towards financial profitability and further market growth.

In December 2010, Wasabi Energy listed on the Alternative Investment Market (“AIM”) of the London Stock Exchange, the international market for smaller growing companies. As a global company, this listing has attracted new investors to the business and assisted in the international recognition of the company and its technologies. We are pleased that our company is being supported by some major institutional funds in the UK.

Wasabi Energy also divested the majority of its non-core investments in Rum Jungle, Aviva Corporation and Greenearth Energy. These were sold for a profit on the original purchase price.

The Group made a loss for the year to 30 June 2011 of $0.5m (2010 - Loss $8.5m). This loss comprised a gain on investments of $7.9m, including a gain of $6.4m on the reclassification of A R Fuels, as well as profits on the sale of non-core assets of $0.9m. This was offset by $2.7m for the costs of the development of GGL as well as non-cash items such as $1.5m relating to the issue of options to employees of the Group.

The company has grown significantly over the past 12 months and we now have the key platforms in place for continued growth and future profitability. GGL has signed a global license agreement and we have a suite of build, own, operate Kalina Cycle® power plants in development that will transition Wasabi Energy into an independent power producer. Aqua Guardian has successfully deployed its water conservation modules, AquaArmourTM and received positive endorsement from water authorities. ARW has secured a source of feedstock at constant price, whilst also acquiring further refining capacity.

Wasabi Energy continues to deliver on its objectives and is building a portfolio of assets to make it a profitable company that delivers sustainable solutions to environmental issues.

I wish to thank our team for their work and dedication to developing the various businesses in which we are engaged and look forward to a bright future.

Overview of Climate Change market place

Wasabi Energy operates in a back ground of growing concern over greenhouse gas (GHG) emissions and their perceived impact on the global climate. The technologies and solutions that Wasabi Energy own are targeted at mitigating the source of climate change (Kalina Cycle® for GHG) as well as the symptoms of climate change (AquaArmourTM for water).

Global GHG emissions are currently circa 50 Giga tonnes CO2 equivalent. (www.climatetracker.com) as shown in Figure 1 below. In the Figure the upper reference line shows where GHG emissions are heading on a business-as-usual scenario. The red line shows the projected trajectory under existing GHG policies and plans. The solid line shows the trajectory required to reduce GHG levels in the atmosphere to the 440ppm, and the lower dotted line is the trajectory needed to reach the 350ppm level, which, according to Climate Change models is the average atmospheric CO2 concentrations needed to restrict the atmospheric temperature rise to 1.5°C. (IPCC), and avoid catastrophic impacts of Climate Change.

Figure 1 – Global Greenhouse Gas Emissions

There is a growing realization worldwide that these GHG emissions targets will not be met via implementation of current polices and plans. Various attempts to reduce GHG emissions to the required levels, particularly in the EU, have relied heavily on Cap-and-Trade type Emissions Trading Schemes (ETS) and increased generation of electricity from Renewable Energy. It is becoming clear that a “Policy Gap” is developing between the targets set and the actual rate of reduction of GHG. Current policies will not meet the GHG targets, which can only be met by using significantly less energy. The EU recently issued a Directive to all 27 member States that in addition to the legally binding ETS and Renewable Energy schemes, total energy consumption must be reduced by 20% by 2020. Binding legislation to meet the 20% Energy Savings targets are expected to be introduced in the EU in the near future. The effectiveness of current EU regulations and programs must increase by a factor of 3 to meet the GHG reduction targets by 2020 as shown in Figure 2 below.

Figure 2 – European Union Greenhouse Gas Policy Gap

Mtoe = Million tonnes oil equivalent

This Policy Gap in the EU is equivalent to approximately 2330 TWh of electricity, or the annual power required by 12 million EU households. This is the amount of power generated by 50 x 550 MW fossil fuel power plants.

To achieve large savings in energy usage will require significant improvements in Energy Efficiency, particularly in the energy intensive industry and power generation sectors. Energy Efficiency standards and Best Available Energy Efficiency Technology regulations can be expected as an integral part of any Energy Savings schemes.

A recent report from the International Energy Agency (IEA) highlighted the massive investment needed in new renewable energy, nuclear and clean fossil power generation capacity in order to reach the GHG targets. The IEA report also stated that if the world’s economies hope to wean themselves from fossil fuels, they will have to significantly improve energy efficiency and begin to harness power from sources such as waste heat from factories (Waste-Heat-to-Power or WH2P).

Wasabi Energy’s Kalina Cycle® technology is one of the most efficient WH2P systems currently available. It can make significant contributions to energy efficiency and GHG savings particularly in the energy intensive industrial sectors such as cement, steel, oil refining and chemicals.

Climate change also affects water sources and supply. Globally only 2.5% of all water on the earth is available as fresh water and only 2.5% of that water is suitable for drinking water. Water conservation is becoming a key issue to ensure that we have enough water for food production, industry and human consumption.

There is no substitute for clean water and water treatment and desalination techniques increase the cost of clean water production. The demand for clean water is leading to an increasing demand for more efficient use of water and water conservation. Throughout the world there are significant financial resources allocated annually by governments and businesses to create and conserve water. The secure supply of water is one of the most critically important issues that faces the world.

As the global emphasis turns to sustainable solutions, the marketplace for our technologies and products grows. The demand for green power and fuels and the need to conserve our water are key drivers for our business success. The business model is built around solving environmental issues by using the competitive edge provided by our own intellectual property to make the solutions commercially attractive to our clients.

Global Geothermal Limited

Global Geothermal Limited (GGL) generates power from waste heat and geothermal sources, without fuel. GGL and its subsidiary Recurrent Engineering, provide alternative energy solutions that are efficient, reliable, safe, clean and cost-effective by deploying the proprietary Kalina Cycle® energy conversion technology. The Kalina Cycle® can produce up to 50% more power from the same heat source compared to other existing technologies.

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Australian Renewable Fuels Limited

Australian Renewable Fuels Limited (ARF) is an Australian company currently producing biodiesel meeting the strictest standards worldwide. Each of ARF’s two plants has an annual production capacity of 44.5 million litres of biodiesel from tallow or oilseed and utilise the Austrian-developed Energea process over which it has exclusive rights in Australia. With increasing emphasis by the Australian government on renewable energy supplies, the company expects that demand for biofuel will increase to the level needed to justify a biodiesel industry.

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Aqua Guardian Group Limited

Aqua Guardian Group Limited, a water conservation company, invests in and develops businesses, technologies, and solutions for the preservation and enhancement of water resources in Australia and internationally. Aqua Guardian’s first product is designed to minimise the effect of sun and wind evaporation losses on large water storages servicing cities, towns, agri-business and mining projects.

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Mr. John Byrne - Executive Chairman

Mr. Byrne has over 30 years' experience in the natural resources industry as an investor and resource business developer. During the past 10 years Mr. Byrne has founded and built a number of companies from the ground up, including from development through to production. In this period he has been instrumental as either CEO or Executive Chairman in overseeing the building of 6 coal mines (in Canada, the US and the UK) along with 3 wash plants, totaling in excess of $500 million of expenditure. Until May 2010 Mr. Byrne was Chairman of Western Coal Corporation, a global coal producer. Since retiring from Western Coal Corporation, Mr. Byrne is now concentrated on identifying projects in and solutions to a number of sustainability issues that exist in the world today.

Mr. Byrne is also an executive director of Global Geothermal Limited.

Appointed 8 May 2009.

Mr. Stephen Morris - Executive Director

Mr Morris has more than 20 years' experience in international investment and management in a wide range of industries. Mr Morris is founder and Chief Executive of Fifth Avenue Capital Inc (a venture capital company) and a founder and director of FAC Smaller Strategic Opportunities Inc. as an early stage resource investor.

Mr Morris is also a non-executive director of Sallies Ltd, a JSE listed fluorspar producer.

Mr. Morris is an executive director of Global Geothermal Limited.

Appointed 13 November 2006.

Ms. Diane Bettess – Chief Operating Officer

Ms Bettess has held a number of general and executive management positions within the mining and construction industries. Her career spans over 25 years with international organisations in operations, project management, strategy and technical roles. These included Boart Longyear, Thiess (a subsidiary of Leighton Holdings), Orica and CSIRO (Commonwealth Scientific and Industrial Research Organisation). Diane is a geologist and holds Bachelor of Science with Honours as well as an MBA and Masters of Commerce in Applied Finance. Diane is a member of the Australian Institute of Company Directors

Appointed 20 December 2010

Mr. Nico Bleijendaal – President International

Mr Bleijendaal career spans 30 years in the iron and steel industry. He has held a range of senior positions including Managing Director, Hoogovens Technical Services, now Danieli Corus. In this role he was responsible for the international engineering and contracting activities and the execution of large industrial projects at Arcelor Mittal, Thyssen Krupp, US Steel, BHP and Posco. Most recently Nico was responsible for the primary iron and steel operations and subsequently the rolling mills, at the TATA Steel Ijmuiden works, one of the most efficient steel-mills in Europe. Years of management and new technology product development experience in Australia and North America.

Appointed 20 December 2010

Mr. Robert Reynolds - Master Eng.(Mining)

Mr. Reynolds is a mining engineer with more than 30 years experience in Australia and overseas in coal marketing as well as coal mining management and engineering. Mr. Reynolds is a consultant providing marketing advice and services to a number of national and international coal producers. Mr. Reynolds past experience was with Southland Coal, Oceanic Coal and BHP.

Appointed 10 August 2005.

Mr. Robert Vallender - B Comm.

Mr. Vallender has over 30 years of management and new technology product development experience in Australia and North America. Mr. Vallender is a consultant providing independent marketing and capital project sales advice to the Australian and European iron and steel and primary metals industries. He has dealt with major manufacturers and producers including Alcoa, U.S. Steel and General Motors.

Appointed 10 August 2005.

Dr. Malcolm Jacques - Ph.D. Chemical Engineering

Dr Jacques is an independent energy consultant, focusing on the Renewable and Clean Energy sectors, with special emphasis on technical and regulatory issues associated with the integration of distributed and renewable energy sources into existing power grids. Dr Jacques maintains close working relationships with policy makers, regulators, financial organizations and consultants in the energy sectors in Europe and the USA.

Dr Jacques’ international career has embraced research, development and implementation of numerous energy technologies in both the public and private sectors. He has worked with several well known companies and organizations including BP Ventures (UK), The Energy Laboratory, MIT (Cambridge, USA), Strategic Research Foundation (Australia) and has played key roles in the establishment and management of public and private energy technology companies in Australia and North America.

Dr Jacques is also an executive director of Global Geothermal Limited.

Appointed 2 March 2010

Mr. Alwyn Davey - Company Secretary

Mr Alwyn Davey was appointed to the position of Company Secretary on 9 July 2009. Mr Davey has experience in cross border mergers, acquisitions and investments as well as formally being a member of the Executive committee of Cambrian Mining Plc, a diversified mining group. He was a non-executive director for Energybuild Group Plc, a UK listed coal company and has been company secretary of a number of UK listed companies which were predominately part of the Cambrian Mining Plc group. Mr Davey holds an LLB degree from Waikato University, NZ.

As at September 2011 ( Source: Cenkos research publication)