Want to hit a bullseye?
You have to choose the right arrow. Forward Water Technologies Corp (TSX-V:FWTC) has clearly picked the right broadhead in the shape of its forward osmosis technology that allows manufacturers to clean their wastewater and reclaim up to 95% of the waste as clean water without burning up too much energy.
With companies under the gun to reduce their water footprint, Forward Water has responded with an elegant chemistry solution to recycle wastewater into clean water for reuse.
As a result, the company is on a growth track as it takes advantage of a blockbuster opportunity.
“I've always been inspired by fundamental science, especially chemistry and materials that perform functions — get a job done. You can see it in action at Forward Water, which has very elegant chemistry, that was developed at Queen's University by Dr Philip Jessop,” Forward Water Technologies CEO Howie Honeyman told Proactive.
As a scientist with a PhD in chemistry, Honeyman has built amazing products and spearheaded the development of a membrane purification product that will result in low-cost vaccines. He was quick to spot the potential of Dr Jessop’s work. Forward Water is a spin-off company based on Dr Jessop’s switchable solvents.
How it all works
The patented technology follows a simple three-step process:
- Water is pulled through a membrane by osmosis due to a concentrated draw salt solution on the opposite side.
- Once that is complete the draw salt is removed from the extracted water by converting it into a gas that bubbles out of the clean water which is then discharged.
- Then the gas is captured and turned back into salt to be reused. The compounds are captured, re-concentrated, and returned to the forward osmosis unit for reagent recycling in a closed-loop process.
The technology was birthed by GreenCentre Canada and is rooted in a platform technology discovered at Queen’s University.
“We re-started the company in 2015 out of GreenCentre Canada and it was literally bench scale. Over the years, we've eliminated the science, technology, and engineering risks,” said Honeyman.
Ramping up commercialization
Forward Water is building an onsite pilot mobile commercial demo plant.
“What we’ve built — and almost finished — is a commercial demo plant, a plant that we can build on-site on a customer's location to treat their water,” said Honeyman.
“We're looking at eliminating the application risk, showing customers how it will work, save them money, preserve their water, and benefit their operations. We are laser-focused on business and commercialization.”
Forward Water’s technology is geared toward multiple industries, but Honeyman has singled out two industries that could benefit significantly from its technology — lithium mining (for batteries) and industrial manufacturing wastes (for example, for food and beverage processing).
“There are so many applications we can chase, but we’re a small company so we have to be focused. We’ve focused on good entry points into various sectors,” said Honeyman.
“Few people know that there’s an inadequate supply of lithium to be found from mining in hard rock and most new lithium will come from underground aquifers. You have to actually extract the lithium from those aquifers which contain brines, or naturally occurring salty solutions,” he added, pointing out that Forward Water can aid in capturing both lithium and clean water.
Lithium opportunity
Cornish Lithium has inked a deal to fund trials of Forward Water’s technology on Cornish geothermal waters. Cornish Lithium is focused on the extraction of lithium in the most green ways in the historic mining district of Cornwall, in the UK.
The deal followed favorable initial results that proved the potential of the technology to increase lithium concentrations in Cornish geothermal waters. Initial computer modeling and forward osmosis simulation testing delivered positive results in “concentrating lithium by as much as a factor of 7x,” said the company.
Forward Water has kicked off a pilot trial at the Sarnia Engineering facility for Cornish Lithium.
“With luck, those results are going to come out very positive and we'll move forward with Cornish Lithium in Cornwall,” said Honeyman, noting that Cornwall is at the epicenter of a potential lithium-mining revolution.
Not surprisingly, other lithium miners have made a beeline for Forward Water’s technology.
“You can't create a sustainable supporting resource by using pollutive, wasteful ways to get it,” quipped Honeyman.
“So, we’ve established relationships with over 10 lithium companies. They want us to do an initial analysis of their brines and figure out where we fit in their process flow. We’ve signed NDAs and are exchanging confidential information. Samples are moving across the globe to be analyzed here, and then we’re sending back the results.”
The lithium miners cover the costs for the evaluation.
“It indicates the companies are willing to put skin in the game,” said Honeyman. “The companies have operations in Argentina, the UK, Australia, Europe, and Canada. Some of the contracts for the analysis of our technology are five-figure contracts. A single sale will carry us for years because they soon become seven and eight-figure contracts.”
Revenue models to drive growth
Forward Water has three different revenue models — Build Own Operate, Build Operate Transfer, and Licensing. While addressing foreign markets, Forward Water will license its technology to companies and generate transfer fees and ongoing royalties.
Honeyman signed his first technology license transfer contract with an India-based engineering services firm.
“The Indian company is established in the water space and was willing to put skin in the game on a license arrangement. They paid an upfront fee for access to our technology, and we supported them,” said Honeyman.
“They have several demo plants and are quickly approaching full sales. We will see royalty on their success. We even traveled to India to support them. We are excited about the partnership.”
Dry factory
Honeyman said the technology’s broad usage is underscored by a concept that he calls a “dry factory” in which a factory draws municipal water only once and that water remains fixed in a closed-loop operation.
“When you build a factory, you buy all sorts of infrastructure that you use over and over again,” he explained. “One of those pieces of infrastructure, for example, is a staircase that you put in your factory. You never have to replace that staircase. Then why do people view water as a throw-away product? Instead of dumping water down a sewer, you can turn it into infrastructure.”
The bullish case
Clearly, there is strong pent-up demand for low-cost wastewater treatment technologies and green lithium.
“There’s a business case for conserving water, recycling wastewater, and making water a permanent piece of infrastructure in a manufacturing firm,” said Honeyman. “The lithium industry is also a growth industry because of the electric vehicle boom. Our low-cost wastewater treatment technology is tapping colossal markets which makes us a very attractive investment.”
The industrial wastewater technology market will eclipse $15 billion by 2024, according to Statista.
Contact the author Uttara Choudhury at uttara@proactiveinvestors.com
Follow her on Twitter: @UttaraProactive