One aspect of EGL that I have thought was quite exciting from a future revenue perspective was their PFAS treatment solution that they have been developing, and are just beginning to commercialise. However, it looks like they aren't as far ahead of the competiion as I had previously thought. I just noticed an announcement from SciDev (SDV) that they signed (22/12/22) an aggreement with Cleanaway to Build Own and Operate a water treatment plant to primarily treat PFAS, but also reduce TDS from a site in QLD. They say they are reducing TDS without reverse osmosis or membrane filtration so I am guessing they must be using some kind of chemical flocculant. Not sure if the EGL solution can be customisable or is more a pure PFAS treatment solution. The SciDev on-site build should begin in Feb 23 and run through to the end of CY23 for a minimum value of $2.15m for a fixed, but undisclosed volume of leachate, with revenue upside potential if they can treat a higher volume.
From LinkedIn I saw that they also completed a PFAS treatment late last year using their mobile treatment unit (400KL/day)-
Earlier this month, SciDev completed the treatment of per-and poly-fluoroalkyl substances (PFAS) impacted surface water run-off at the future Woolworths Moorebank Regional Distribution Centre (MoRDC). The future distribution centre, scheduled to open in 2024, is a $175M project being delivered by Richard Crookes Constructions.
Due to the historical land use at Moorebank, trace PFAS contamination was present in the subgrade throughout the MoRDC Stage 2 Site. Stormwater run-off from rain events became contaminated with PFAS and required capture and treatment to avoid contaminating surrounding rivers/creeks. During the construction of the MoRDC, Moorebank experienced long periods of heavy rain. As a result, on-site water storage was at risk of uncontrolled discharge. To mitigate against this, the water treatment plant (WTP) was mobilised and fully operational within four business days.
The water treatment plant, with a nameplate capacity of 400 kL/day, treated 14.1ML of surface water run-off and enabled the safe discharge of treated water, meeting strict environmental regulations. The quick mobilisation of the water treatment plant provided a reactive response and maintained the construction program despite heavy rainfalls throughout the construction period. A cost-effective and functional solution to treat what could have been a significant risk to the project.
There is a real demand for a viable and cost effective PFAS treatment option and it looks like SDV is getting the first mover advantage and building a reputation in this space. I am expecting that if they deliver well on the Cleanaway project then Cleanaway are more likely to use them at their other landfill sites. This could remove one potential large customer from EGL's PFAS solution. Likewise, I am aware of a lot of local councils that know they have a PFAS problem and are hungry to implement a viable solution, with cost being less important than outcome. So I think the market is ready and probably is large enough for both companies to be successful in the space, but the margins may not be as high with multiple competitiors bidding on tenders.
