Friday, June 05, 2015

Europe's Graphene Supplier

The most recent post “Glamor of Graphene” on June 2nd, began an exploration of the production and applications of the ‘wonder material’  - graphene.  Since its ‘discovery’ by University of Manchester scientists in 2002, graphene has captivated the attention of engineers across numerous industries.  It is the strongest material on earth  -  as much as 150% stronger than steel.  Yet it is as pliable as rubber and can be stretched to 120% of its original length.  What really gets product developers excited is how graphene can conduct electricity.  Graphene also exhibits high ‘mobility,’ which is a measure of how fast electrical charges flow across the particles.  Graphene is 250% more ‘mobile’ than silicon. 

Battery developers, semiconductor companies and metals manufacturers are just a few that have been working to find an application for graphene.  Unfortunately, it seems that for every possible use of graphene there is a problem in production.

Based in Spain, Graphenea has developed technology they believe solves some of the thorniest graphene production problems.  The company has at least one method patent in its pocket. 

Graphenea sells a series of graphene layers and solutions and graphene oxides in various configurations.  However, Graphenea only delivers small quantities suitable for research and development.  A four-inch wafer of silicon with a monolayer of graphene on it will set a scientist back $849.00.  The budget minded researcher can order a one square centimeter of the some configuration for $59.00.   Graphenea will spring for shipping on orders over $600.  Thus the one problem that everyone needs to get solved   -  producing economically at higher volumes  -  is still beyond even Graphenea’s reach.

Undeterred, Graphenea appears serious about securing a foothold in the graphene supply chain.  The company has set up a series of distributorships that cover the major markets around the world.  The corporate website claims customers in forty countries. 

A privately held company, Graphenea received $1.3 million in funding from Spain’s oil and gas giant, Repsol, SA (REP:  MC, REPYY:  OTC/PK) in 2013.  As a fully integrated energy company, it might seem unusual for Repsol to make an investment in graphene production.  Graphene oxide is being used in water-based drilling fluid to limit dispersion of drilling fluids into surrounding rocks.  Graphene NanoChem sells a high performance drilling fluid branded as PlatDrill, which has been enhanced by graphene nanomaterials.   The conductive properties of graphene could also help collect data on the geological properties of reservoirs targeted by oil and gas exploration operations.

Repsol provided a small venture round investment that was intended to support Graphenea’s research and development efforts.  With a product portfolio built on patented technology, an established customer list, and a building network of partners, I expect this company to return to the capital market at some point for expansion capital.  It will likely to be another private round of funds, leaving most of us on the sidelines, at least for now.   

 

Neither the author of the Small Cap Strategist web log, Crystal Equity Research nor its affiliates have a beneficial interest in the companies mentioned herein.
 

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