Discl: Held IRL 0.73% and in SM

Worked through each of the customer-related Memorandum of Understandings as far back as I could to get a more detailed feel of how it all comes together. There is a lot of detail in each announcement - have summarised the customer projects/MOU’s in the table below. 

I am gaining increasing conviction of (1) the technology - it is here and real (2) the opportunities currently on the go and how they are progressing and (3) how the various pieces come together - technology, business model, expertise, graphite.

Will peel HZR’s technology partner agreements next - Kellog Brown Root is a big one, and then PSRI.

HZR'S MARKETS

1. Hydrogen Production Market

2. Graphite Market

Improves the economics of the HZR technology amidst (1) critical Tier-1 need for energy transition (2) China dominates supply and tightening export processing technology and IP (3) HZR is a local, high purity, low emissions alternative.

Graphite is a key component in lithium-ion batteries, electric vehicles, renewable energy storage systems and numerous industrial applications

The Hazer process produces high-purity graphite with unique product characteristics well suited to advanced applications, steel making, cement and asphalt, PFAS remediation and thermal energy storage

3. Sales Pipeline

Very strong global pipeline, with large amounts of potential hydrogen production capacities.

Asia is one of the world’s largest hydrogen markets with regional demand in 2024 of approximately 40M tonnes per annum - almost 40% of the global hydrogen market and growing steadily at around 4$ annually

CUSTOMERS AND PROJECTS CURRENTLY ON THE GO

Worked through each of the customer-related Memorandum of Understandings as far back as I could to get a more detailed feel of how it all comes together. There is a lot of detail in each announcement - have summarised the customer projects/MOU’s in the table below. 

I am gaining increasing conviction of (1) the technology - it is here and real (2) the opportunities currently on the go and how they are progressing and (3) how the various pieces come together - technology, business model, expertise, graphite.

Will peel HZR’s technology partner agreements next - Kellog Brown Root is a big one, and then PSRI.

KEY TAKEAWAYS

• Very insightful to see the sorts of hydrogen and graphite production collaborations/MOU’s that HZR has signed up to and are working on
• There is good, steady and positive progress across all projects other than Engie - need to check why that seems to have fallen off the radar.
• The Fortis BC project is particularly exciting in terms of (1) size, 25x that of HZR’s Commercial Demonstration Plant in WA (2) where it is at - successful completion of Commercial Reactor Test Program (3) The British Columbia government support (4) receipt of first revenues and (5) the potential licensing commercial terms during production which could be on a sliding scale model based on size of the facility, production of hydrogen and graphite and other relevant factors
• Each commercial agreement executed in a producing Hydrogen facility is likely to be a step up in long-term recurring revenue - this is very exciting in terms of future revenue stream possibilities - this revenue will grow as the producing plant scales eg. Chubu Electric
• Good to see how the various pieces have come together in the MOU’s/Projects - (1) the role of the Commercial Demonstration Plant in proving the concept (2) the application of the Hazer technology in a real-life site/environment (3) the role of Hazer Graphite in significantly improving the production economics (4) the various MOU’s to commercialise Hazer Graphite, offtake opportunities etc
• Sales Pipeline looks extensive and makes sense in terms of where HZR is targeting the use of the Hazer technology

KEY RISKS THUS FAR

• Very long gestation period from start of concept/feasibility to a producing plant
• There is no deal until there is a deal - this is an ongoing risk, but appears to be well mitigated with steady progress, robust technology and economics, and good technical capability partnerships, but this is still the biggest risk

Customer Projects/MOU's Signed

May not be complete but gives a good idea of the sort of MOUs and capacities being investigated. This was what I could find in the announcements.

Discl: Held IRL 0.67% and in SM

Part 1 of a few parts as I deep dived on HZR.

SUMMARY

HZR owns the IP to the Hazer Process and is developing and commercialising this technology

The Hazer process is a low-emission method for producing hydrogen and graphite from natural gas or biogas. It uses a low-cost iron ore catalyst to crack methane into hydrogen gas and solid, high-quality graphite. This process offers a cleaner alternative to traditional hydrogen production by capturing the carbon as a valuable solid product instead of releasing it as carbon dioxide.

There are significant benefits to the Hazer Process vs the current dominant Steam Methane Reforming (SMR) method of producing hydrogen - zero carbon emission, low energy requirement, no requirement for carbon capture storage, valuable carbon graphite co-product which can be monetised

The Hazer Process is categorised as a “methane pyrolysis” method of producing hydrogen

Other companies have developed variations of the methane pyrolysis method, but the Hazer process is differentiated by the following advantages: (1) the use of Iron Ore as a catalyst (2) creates high quality Graphite Carbon as a co-product (3) avoids need for carbon capture storage (4) low electricity cost

The choice of which methane pyrolysis methods for a given plant/site will depend on several factors, including (1) energy source & footprint (2) scale & deployment model (3) carbon product quality

The focus in the past few years has been to build the Commercial Demonstration Plant (CDP) in Munster, WA, which has been fully operational since Nov 2024 - this was a key milestone to demonstrate the commercial readiness of the Hazer Process technology

WHAT IS ATTRACTIVE

The Hazer process has huge technology advantages over current methods of producing hydrogen, including other alternative methane-pyrolysis approaches

Hard yards to scale up and prove the Hazer process has already been done - the technology appears to be ready for scale-up and commercialisation

This is feeling very much like C79, minus the Capex spend on the Photon Assay machines - the Hazer technology is set to disrupt the current dirty method of producing hydrogen by offering a more efficient and clean approach, with the economic benefit of high quality carbon graphite as a co-product which can be monetised

A. BUSINESS MODEL

Has IP rights to a technology developed a The University of Western Australia which allows the production of hydrogen gas from methane (natural gas) with negligible carbon dioxide emissions and the co-production of a high purity graphite product (the “Hazer Process”)

Business model is focused on scaling-up and commercialising the Hazer Process so as to supply hydrogen gas and high purity bulk graphite to the significant global hydrogen and graphite markets.

B. HAZER’S MISSION

Our mission is to play a significant role across three multi-billion dollar global markets. Hazer Group’s technology can potentially provide an innovative solution for the global industrial hydrogen market, by producing hydrogen at lower cost than alternative options, while also reducing users’ CO2 footprint.

The low-emissions associated with the HAZER Process also potentially provides a gateway for hydrogen to more effectively penetrate the sustainable energy market for both vehicle fuel and stationary power applications. Hazer is also looking to provide high quality synthetic graphite for energy storage and other large global graphite applications.

C. THE HAZER PROCESS

The Hazer process is a low-emission method for producing hydrogen and graphite from natural gas or biogas. 

It uses a low-cost iron ore catalyst to crack methane into hydrogen gas and solid, high-quality graphite. 

This process offers a cleaner alternative to traditional hydrogen production by capturing the carbon as a valuable solid product instead of releasing it as carbon dioxide.

HAZER’S DISRUPTIVE ADVANTAGE - METHANE PYROLYSIS METHOD vs INCUMBENT SMR TECHNOLOGY

The Methane Pyrolysis technology method has very clear economic benefits over the current Steam Methane Reforming (SMR) method BUT HZR is not the only company with technology in the Methane Pyrolysis space.

Discl: Held IRL 0.67% and in SM.

Continuing with Part 2, focusing on the competitive landscape and Tech Readiness for Commercialisation

COMPETITORS WITH METHANE PYROLYSIS TECHNOLOGY

Methane pyrolysis requires approximately half the amount of energy required by steam reforming to produce the same amount of hydrogen. Finally, the solid carbon byproduct can be sold as carbon black, offsetting the cost of hydrogen produced. Together, these factors make methane pyrolysis a promising technology option to produce low-carbon hydrogen.

Methane pyrolysis takes different forms, and they can be categorized as plasma, catalytic, and thermal

In methane pyrolysis, all the carbon content in the methane is captured in solid form rather than emitted as carbon dioxide

About 44% of methane pyrolysis technology developers are based in the U.S. or Canada, where the feedstock price is cheaper than in Europe and Asia. The attitude toward repurposing existing assets in North America is also more favorable than in other regions, considering that the only operational commercial methane pyrolysis facility is located in the U.S., and the second one is being planned in Canada. 

Practical implications — why the methods matter to buyers / project owners

Carbon product quality drives value: Hazer emphasises graphitic carbon (battery anodes / high-value applications). If a competitor produces amorphous carbon black, the co-product value and markets differ. That affects project economics. 

Energy source & footprint: Plasma approaches are electricity-intensive (cost + grid emissions matter); microwave and molten-media concepts claim efficiency advantages — Hazer claims lower electricity intensity by leveraging catalytic chemistry and heat integration. Buyers compare energy cost per kg H₂ and grid carbon intensity. 

Scale & deployment model: Some firms aim distributed, point-of-use hydrogen (microwave, Aurora), others aim industrial replacement markets (Monolith carbon black), and Hazer targets licensable commercial modules with graphite offtake economics. Choice depends on the customer (industrial vs mobility vs battery material players). 

PATENT PROTECTION

• HZR has 70+ IP patents in its IP portfolio in different countries to protect its ownership of the IP
• Full list is maintained at Patents List

TECHNOLOGY READINESS FOR COMMERCIALISATION

Extract from: https://research.csiro.au/hyresource/hazer-commercial-demonstration-plant/

• Focus in the past 3-4 years has been to build and develop the Commercial Demonstration Plant (CDP) to demonstrate the readiness of the technology in a real-life plant environment - located in Munster, WA
• The CDP has been operational since Nov 2024
• Virtual Tour of the Commercial Demonstration Plant:

Discl: Held IRL and Pending in SM

I like it when I gain immediate conviction on analysing a new company. And so it is with HZR this morning.

I will deep dive in the next 1-2 days, but I read the Q1FY26 Preso released this morning, had a look at what the Hazer technology is and does, and pulled the position open trigger 10 minutes into the webinar at $0.52. More detail to follow.

High-Level Position Opening Thesis

1. Technology is affordable, scalable and available now - ready to disrupt, after 17 years of developing the technology into an advanced state - $130m development capex cost is now in the past
2. IP Owner, licensing model, so capital light
3. Global alliance with KBR - big engineering tick to advance commercial scale-up and go-to-market strategy
4. End Products of the Hazer Process - Clean Hydrogen and Graphite - huge market demand for both products. Market is aligning to the Hazer technology benefits and technology availability
5. Graphite Market dominated by China (80% of processing and supply) - tightened export controls - HZR offers a local, high purity, low emmissions altenative - this is a significant differentiator from other clean hydrogen processes, geo-political developments mean planets are aligning for Graphite
6. Global sales pipeline looks impressive - management is focused on "quality over quantity"
7. Financials are growing nicely - $20m of funding available, low operating cost base with a focus on continued cost discipline

CHART

The HZR price is in a nice support resistance zone of $0.51 to $0.555. It feels like this is a fair price and entry point given the technology de-risking that has occurred in the past year, and the potential commercial scale up that occurs from here.

Immediate downside support is $0.45 - if my deep dive confirms this initial feel, will be topping up, up to these levels. Given where the company is at the moment, the technology de-risking, the opportunities, this feels like a very defendable floor.

Two recent announcements - 7/7, then 15/7 - and the SP has finally got some traction.

ANNOUNCEMENT 7TH JULY:

HAZER AND KBR ACCELERATE GLOBAL ENGAGEMENT STRATEGY FOCUSED ON NEAR-TERM DEPLOYMENT OPPORTUNITIES

Highlights

• Alliance team now operational across three global hubs – Australia, the UK and US – with workstreams advancing commercial scale-up, licensing and customer engagement
• Process Design Package (PDP) underway to support large-scale deployment, driven by growing customer demand
• Industry shift away from stalled green hydrogen projects opening-up further market opportunities forHazer's low-emissions, low-cost alternative
• Strong commercial interest in ammonia and methanol markets, where hydrogen is already in use and supply chain, infrastructure and logistics is established
• Jointly developed global customer engagement strategy, leveraging KBR's networks to prioritise near-term licensing opportunities in North America, the Middle East and Asia-Pacific

PERTH, AUSTRALIA; 07 July 2025: Hazer Group Ltd ("Hazer" or "the Company") (ASX: HZR) is pleased to report significant progress under its strategic alliance with (the "Alliance") Kellogg Brown and Root LLC (NYSE: KBR,"KBR"), established to accelerate the commercial deployment and licensing of the Hazer Process. (Etc.)

FOLLOWED BY ANNOUNCEMENT 15TH JULY:

HAZER AND ENERGY PATHWAYS SIGN MOU TO DEVELOP CLEAN HYDROGEN FACILITY IN UK

Highlights:

- Hazer enters an MOU with UK-based Energy Pathways to evaluate development of a clean hydrogen production facility in northwest England.

- The proposed project aims to develop a Hazer-licensed facility producing 20,000 tonne per annum integrated with EnergyPathways’ MESH infrastructure project

- The parties will conduct concept engineering studies to assess the production of hydrogen, ammonia, and graphite.

- Hazer will leverage its strategic alliance with KBR for integration of Hazer technology with manufacturing of ammonia.

PERTH, AUSTRALIA; 15TH JULY 2025.(etc).

How long the market interest will last is anyone's guess. One of the issues HZR faces is the long (in market expectation terms) lag time between announcements such as the 2nd one and significant $ hitting the bottom line. That said, they aren't the ones building the installations. They license the tech and will get paid for consultation services in guiding implementation.

Held IRL

Delay to Reactor Fabrication - 15 December 2021

• Anticipated as a 8-12 week delay to the commissioning of the Hazer Commercial Demonstration Project due to "manufacturing flaws"
• Additional costs associated to this not disclosed in this announcement.
• Rectification plan still being determined.
• Target date of 1Q 2022 not expected to be met.

Cue deeply disappointed investors putting a damper on the share price. This just highlights that this is still a highly speculative stock despite being 'close' to having a working prototype. I'm looking to dip my toes in a for a punt sub $1.

Disclosure: Previously held.

The Hazer commercialisation demonstration plant may end up being brilliant timing, anticipated commissioning 1Q2022

What with ScoMo doing a 180 U(te)-turn on his EV statements of yesteryear. Maybe he can accept a Hydrogen fuel cell powered Ute for the tradies.

I still expect governments around the world will start a huge push for Hydrogen fuel cell powered EVs as they solve so many problems. It really is a neat solution.

• Green Hydrogen can decarbonise the planet when extracted from Methane (a majorly nasty greenhouse gas)
• It should be relatively easy to even retrofit a fuel cell to a pure EV. It just needs to be something that keeps the batteries charged as you drive. Just a decent continuous trickle charge will do.
• Filling up with Hydrogen is identical to stoping at a service station and filling up with LPG today. No need for a network of charging stations, just add a Hydrogen tank to each servo.
• Extended (indefinite) range without a need for lengthy recharge stops. Can refill whenever you need.
• With range no longer being a problem can reduce the vehicle weight by taking out probably more than half its batteries.
• Reduced need for batteries should help supply chain shortages, and even scarcity of some materials.
• But most importantly—governments will be able to charge a tax on Hydrogen pumped at a service station and recoup all that lost fuel excise revenue. And they don’t need to worry about road users getting a fre ride as they currently can by re-charging at home from solar.

I suspect that last point is the real reason we don’t have more EVs on the road already.

Market cap $145m

• The company has just wound up its SPP raising $7m at 92c. Most placements and SPP now do tend to hit the issue price at some stage.
• HZR is promoting a low emissions hydrogen and graphite production process. The Hazer Process enables the effective conversion of natural gas and similar methane feedstocks, into hydrogen and high-quality graphite, using iron ore as a process catalyst.
• The process produces two products. Hydrogen and Synthetic Graphite. 99.99% purity for the hydrogen and 80-95% in the graphite.
• Hazer’s emissions are lower than alternative technologies when operated with renewable biogas as feedstock.
• Fully funded now to develop the first commercial development project

This one feels a little like Calix (CXL) in some respects. Where CXL has a Calciner which takes CO2 out of the kiln process of cement production, HZR has a process that creates two very useful materials with no CO2.

CXL is capped at $760m but has far more deals and trails out there plus it has a different business model but does show the potential for a HZR rerating. I suspect the recent cap raise is weighing on the stock.

• Morgan Stanley forecast global hydrogen market of $150bn in 2020 to grow to US$600bn by 2050.
• Alan Finkel the Chief Scientist for Australia has this to say about hydrogen, “be ambitious and be patient.”
• HZR has a strong balance sheet.
• Good R&D pipeline
• The Hazer CDP was supposed to be delivered this year. However, that timeline has slipped on weather and CV19 issues. Now looking at Q1 2022 although the company is sticking to the cost of $21-22m. This will prove the catalyst along with any further delays in progress.

Speculative Buy but maybe some patience required as the CDP timeline is beyond the company control. That will be a major catalyst next year. It could well have a run into the commissioning but cost overruns and timing may hold it back until more clarity.

Placement Details:

• HZR has received binding commitments from institutional and sophisticated investors to
  successfully raise gross proceeds of $7,000,000.32
• 7,608,696 new fully paid ordinary shares at an issue price of $0.92 to
  raise $7,000,000.32 (before costs).

Share Purchase Plan Details:

• The SPP entitles Eligible Shareholders, irrespective of the size of their shareholding, to purchase up to $30,000 worth of SPP Shares at an issue price of $0.92 per SPP Share

Dilution alert. The share price has traded between $0.94 - $1.00. HZR is probably one of the promsing hydrogen ASX stocks with a work in progress Hazer Commercial Demonstration Project (CDP), albeit with a few delays since its planned inception. As a working infrastructure is yet to be proven or commercialised, I am a watcher of this stock for now and won't participate.

Disc: Previous shareholder

AP Ventures fund investing $4mil in Hazar group, with managing partner of AP ventures, Andrew Hinkly going onto the board of Hazar group. AP Ventures invests funds in to renewable energy integration and hyrdrogen production chains. 

This company popped up on Create digital, a nice hydrogen story with graphite instead of CO2 as a by product!