SeaStock Update June 2024

Welcome to the June 2024 Update and thanks for your ongoing interest in SeaStock. It has been another busy period for the Company!

During the Quarter we continued to build on the operational achievements of the first three months of the year and took further steps towards providing commercially viable products to the market, both here in Australia and internationally.    For example, since achieving high bromoform concentration and high pigment purity results across March and April, we have now successfully increased the dual extraction process capacity from 1.5kg of biomass to 50kg. This increase is significant on many fronts and has enabled SeaStock to more efficiently batch process higher volumes of the compounds.

The step up in capacity will enable SeaStock to commit to selling the oil concentrate to targeted customers in markets that require trials for regulatory approval, including New Zealand, European Union and the United States. This is our first commercial step forward on supplying material to parties that will be a part of building long-term value for the SeaStock business. 

As we continue to meet and surpass our product development milestones, we will also continue to assess our capital requirements. As always, we welcome new and existing shareholders to the SeaStock story.

With six months of 2024 behind us and winter well and truly here (in Australia), we’d like to wish you all a safe mid-year holiday season and a prosperous FY 2024/25.

SeaStock continues to actively engage with the New Zealand market via AgriZero, a partnership between the NZ Government and its domestic agribusiness industry.

Over the past three months our activities have included our Research Scientist, Sanjana Senthilkumar, participating in an industry technical workshop in NZ to identify the regulatory pathways required for product registration.  

Since then, we have been collaborating with AgriZero and a consortium of NZ industry parties on the regulatory approval process for our concentrated bromoform, which will require further efficacy testing on product formulations before final product registration. 

In the EU, SeaStock is in negotiation with Omya for a material transfer agreement to develop SeaStock oil concentrate into their finished feed ingredients. 

Omya partners with leading manufacturers of specialty materials, providing a portfolio of pigments, binders and additives to customers worldwide. They serve several industry sectors, including agriculture, food, pharma and nutrition. 

We will continue to explore further strategic relationships that align with our growth objectives and enhance our market position.

Our site evaluation on the Coogee Chemicals land in Kwinana remains favourable and has gained further support due to the interest in optimising our residue biomass via the pyrolysis process for adjacent industry uses, such as feed stock for the sustainable fuels industry and green steel manufacturing. In June, we commissioned UWA to conduct a pyrolysis mass balance assessment on the residue biomass.

This site location currently presents our optimum location however we will continue to assess further sites, especially in light of strategic capital raisings.  

Our agreement with Regis Resources Ltd to evaluate the feasibility of using their disused mine pit water reserves commenced in June. SeaStock is currently testing biomass cultivation using Regis mine pit water. 

A range of culture experiments are being conducted to evaluate this opportunity and we are expecting to have preliminary results for presentation to Regis by the end of July.

Since reporting our bromoform high yield and concentration results to the market, SeaStock is ramping up its production to offer the oil concentrate to our targeted offtake customers.

Across the major high demand markets for methane reduction additives, all of them require separate regulatory trials for the approval of use and registration of supplied material by the various government authorities. While the industry is in the early stages of commercialisation, we believe that suppling our current production volume into trials will deliver the best value and will serve to open up the long-term market access.

As we increase the pilot plant production capacity, additional product will be offered commercially to domestic feed lot and dairy operators. Interest in the high concentration oil demonstrates our competitive advantage in delivering a low-cost solution to the market.

Following the successful UWA red pigment purification method earlier in 2024, SeaStock has ordered specialised equipment to begin the processing of the crude liquid extract into the pharmaceutical grade material.

Commissioning of the equipment will take place during July with the aim to present high grade material to our targeted customers soon afterward for their evaluation process to commence.

Our strategy is to continue to focus on the Food & Beverage, Cosmetic and Pharmaceutical industries as each segment will have specific commercialisation lead times for market acceptance. SeaStock has a material transfer agreement in place with European based DSM-Firmenich, their scope of work is on track to commence in August using our pigment samples.

Furthermore, we are now utilising SeaStock’s pilot plant at our Fremantle laboratory to generate positive cash flow from both compounds, during the second half of 2024.

1. Method of Producing Asparagopsis Application filed.

2. Optimised Dual Extraction System Patent Cooperation Treaty (PCT) lodged.

3. Large Scale Growing Infrastructure Further design adjustments for the growth system are being developed, before applying for a provisional patent.

We continued spore collection from offshore Rottnest Island, as well as the ongoing work optimising the inducing method which will continue until September. 

SeaStock recently applied for a broader commercial collection licence covering the area between Garden Island and Abrolhos Islands, apx 500 kilometres north of Perth. 

The licence will allow SeaSock to commercially take a quota of up to 6mt of wild biomass over three years. This will provide us with the capacity to collect higher volumes of spore for inducing and biomass for compound processing to seed market demand while we look to build our commercial plant.

Before joining SeaStock, Sanjana gained immense experience in the field of natural product chemistry and various analytical techniques through her Ph.D. work at the Indian Institute of Technology Guwahati and as a Senior Lab assistant at ALS Geochemistry. After joining SeaStock late in 2023, Sanjana has now taken charge of the company’s aquaculture program and compound extraction product development.

“We have tackled various hurdles in terms of improving the health of the cultures and growth rates,” she said. "However, every day we learn something new and further improve what we are doing. We are certainly moving quickly up the learning curve.”

Sanjana is very excited with the large scale inhouse facility for the production of Asparagopsis oil and the upcoming setup for producing R-PE of various grades.

“The new challenges and troubleshooting make the work very enjoyable and fulfilling, and I can’t wait to see what the next 12 months brings for SeaStock,” Sanjana concluded.

Events and milestones to watch out for over the coming weeks:

• SeaStock in the Media 
  • WA Business News 
  • AgFunder News 
• Keep an eye out for our social media updates regarding the new season spore collection program; follow us on LinkedIn and Instagram 
• Next Shareholder Update – end of the September Quarter 2024