Role and company:
CEO of Velocys, an AIM-listed innovator of smaller scale gas-to-liquids (GTL) and biomass-to-liquids (BTL) technology.
Company turnover (and most recent ebitda/most relevant profitability metric):
In 2012, the company reported revenues of £7.6m.
Approximately 100 people operating from three facilities in Houston, Texas, USA; near Oxford, UK; and Columbus, Ohio, USA.
Growth forecast for the next three years:
It is still too early for us to publicise growth forecasts.
In under 50 words, what makes your business distinctive in its marketplace:
Velocys is pioneering a new industry: the distributed production of fuels and chemicals, initially through smaller scale GTL. In essence, we are changing the way fuels and chemicals are made. The company leads the field and we have an exhaustive global patent position with over 7,500 granted GTL patent claims.
What’s the big vision for your business?
Our vision is to make smaller scale GTL a commercial reality. Picture a future in which most oil fields producing significant amounts of associated gas incorporate a smaller scale GTL plant, stopping flaring, and significantly reducing CO2 emissions. There would also be a large number of gas fields “stranded” by their distance to market and are opened up using smaller scale GTL. Picture a small scale BTL plant at the waste processing facility of every large town or city, anywhere in the world, and the production of a fuel that can be used by the local community or sold for its economic benefit. Velocys is working to make this future a reality.
Current level of international business, and future aspirations:
We anticipate that the vast majority of our sales will come from outside Western Europe: early adopters are likely to be located in North America, where the long-term stability of low gas prices and high oil prices is expected. We also see a large part of our business coming from the CIS region, where the widespread and environmentally-unfriendly practice of flaring of associated gas is subject to increasing regulation and taxation, and where smaller scale GTL plants could provide a solution.
Having said that, one of the four announced commercial projects that our technology has been selected for is GreenSky London. British Airways is working with project developer, Solena, to establish Europe’s first sustainable jet fuel plant and intends to use the low-carbon fuel to power part of its fleet by 2015. After a formal evaluation of available technologies Velocys was selected as the sole supplier of Fischer-Tropsch technology for GreenSky London.
Biggest career setback and what you learned from it:
Selling a company of mine to the wrong people. I learned that just because a company is public doesn’t mean there is always full transparency. Now that I run a public company, I have worked hard to ensure that investor expectations remain aligned with reality. Whilst remaining positive, I’ve sought to avoid the trap that some companies fall in to – that of getting carried away with their own hype.
What makes you mad in business today?
Lack of courage.
What will be the biggest change in your market in the next three years?
In three years’ time we expect there to be a smaller scale GTL plant in operation somewhere in the world, and we expect it to incorporate Velocys’ technology. The oil and gas industry is waiting for a company to demonstrate that there is a commercially attractive alternative to the large-scale GTL plants producing upwards of 30,000 barrels per day (bpd) currently in operation by Sasol and Shell. In three years’ time Velocys will have demonstrated a GTL solution “for the masses”, that can run economically at capacities around 1,000 – 15,000 bpd.
Can businesses in your sector/industry access the finance they need to grow? If not, what can be done to improve things?
For those with the right pedigree, absolutely. We completed a very successful fundraising round in December 2012 where we raised £30.6m. The oversubscribed fund raising, achieved under difficult market conditions was a huge vote of confidence in Velocys’ technology and potential.
How would others describe your leadership style?
Visionary, honest, energetic.
Your biggest personal extravagance?
I like to collect beautiful things. There is almost no end to the cost of this.
You’ve got two minutes with the prime minister. Tell him how best to set the UK’s independent, entrepreneurial businesses free to prosper:
Encourage a society that allows people to fail as long as they tried. For example, in education acknowledge and reward action and initiative, not just “success”. Give people opportunities to do and try new things. Encourage people to think for themselves, not just adopt the views they are fed by various media; reading books from the past helps us realise that some “truths” around us are just a fashions of our times and some are more enduring.
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