Highlights

• LNG trade registered significant growth globally in 2021.
• Carbonxt has begun to explore the lucrative sector and signed its first contract in March this year.
• There has been a sharp rise in the demand for Carbonxt’s products in the US.  
• The company is witnessing a growing and expanding pipeline of customers and opportunities in new sectors.

The LNG trade surged by 4.5% in 2021 over the last year, as per the LNG industry’s annual report by the International Group of Liquefied Natural Gas Importers (GIIGNL).

There have been several new additions to the LNG export capacity, particularly in the United States. Also, the continuous increase in demand for natural gas in major LNG-consuming countries is triggering significant rise in LNG trade worldwide.

In short, the upstream LNG sector is prompting more and more businesses to engage and draw benefits. Carbonxt Group Limited (ASX:CG1), one of the overriding cleantech companies, is also gradually crafting its plan for marking its footprints in the LNG sector.

How huge is the opportunity?

There are approximately 189 onshore and floating liquification and regasification terminals globally. Moreover, several plants are under the construction phase and or given a green signal for construction.  

As the production rate is increasing in the LNG space, the need to accelerate the decarbonisation of the sector has also intensified.

Carbonxt is primarily involved in developing and marketing specialised powdered activated carbon and activated carbon products that can capture harmful pollutants released during industrial processes. The ASX-listed cleantech company helps its clients in wastewater treatment, industrial air purification, and other liquid and gas phase markets.

The LNG space is witnessing rapid growth in the need for technologies to meet sustainability and decarbonisation goals. The company’s solutions can provide LNG facilities with a tool to decarbonise their operations.

CG1’s avenue in the large LNG space

Image source: © Fokussiert | Megapixl.com

Carbonxt marked its entry into the LNG sector in the March 2022 quarter with a contract worth AU$2 million from chemical products supplier Univar Solutions USA, Inc. As per the agreement, the company will provide Activated Carbon Pellets (AC Pellets) to Univar, which in turn would cater to its client base in the LNG sector.

For all the contract-related orders in 1HFY23, CG1 will manufacture pellets from its Arden Hills facility. Also, the demand will be fulfilled by the Kentucky facility once it is ready to function.

This is a major move by the company to significantly expand its addressable market into an industry which was not serviced previously.

The company is guided by its vision to strengthen and diversify its customer base by adding more businesses wishing to lower down carbon and pollutant emissions from their industrial activities.

Positive operational progress

In the March 2022 quarter, CG1 secured customer receipts of AU$3.8 million. The quarterly sales of Powdered Activated Carbon (PAC) witnessed 28% growth over previous quarter.  

Clearly, the demand for Carbonxt’s products is on a rise in the global market. Thus, the company is looking forward to scale up its production capacity to deliver as per the growing market. It is also building on existing partnerships and establishing new alliances in some large sectors aiming global expansion.

CG1 shares traded at AU$0.170 on 08 July 2022, up over 9.6% from the last close. The company has a market cap of AU$29.36 million.