Jericho Energy Ventures Inc. (JEV:TSX.V; JROOF:OTC; JLM:FSE) is a Canada-based energy concern that operates and develops traditional hydrocarbon joint venture (JV) assets while advancing the low-carbon energy transition into hydrogen infrastructure.
The firm's principal activity is the acquisition, exploration, development, and production of oil and natural gas fields in the United States of America. It also operates a wholly-owned subsidiary, Hydrogen Technologies, that delivers patented zero-emission boiler technology to the commercial and industrial heat and steam industry.
Jericho's first-of-its-kind hydrogen-fueled boiler, known as the Dynamic Combustion Chamber™ (DCC™), offers a highly efficient and sustainable alternative to conventional fossil fuel-based boilers, providing a clean and eco-friendly steam source for various industries and applications.
Leveraging an exothermic reaction that combines pure hydrogen (H2) and pure oxygen (O2) gas, the DCC achieves an independently verified fuel efficiency of over 97%, with zero greenhouse gas emissions.
In addition, Jericho Energy Ventures holds strategic investments and board positions in electrocatalyst and low-cost electrolyzer platform H2U Technologies and high-pressure, ultra-efficient electrolyzer firm Supercritical Solutions.
The company's long-held, producing oil and gas joint venture assets are located in Oklahoma.
The Catalyst: New Patent
On September 12, Jericho Energy Ventures reported approval from the U.S. Patent and Trademark Office for the protection of the firm's DCC hydrogen-fuelled steam boiler, developed by the Hydrogen Technologies subsidiary.
The granting of this patent bodes well, as the subsidiary has two further patents pending to protect and enhance the device's novel IP, and the company has begun receiving initial commercial orders.
According to Jericho Energy Ventures CEO Brian Willamson, the company is "excited about the new patent allowance from the USPTO and looks forward to the opportunity to continue to expand its portfolio of IP related to its emission-free industrial hydrogen boiler system."
Jericho Energy Ventures' HALO Hydrogen Hub entry was ranked by Rystad Energy among the top ten likely to secure funding from the Department of Energy's regional clean hydrogen hubs program.
On August 3, the company announced that a leading U.S. University had agreed to procure and deploy a DCC boiler as part of its district heating system, establishing it as a market-ready solution to help decarbonize the estimated US$198 billion global district heating sector.
The company also recently announced a three-way EU partnership with Sofinter Group and Exogen was announced. This came on the heels of a collaboration with a global alcoholic beverage company for a four-country DCC study, which could lead to multiple boiler deployments at beverage production facilities.
In addition, Jericho Energy Ventures' HALO Hydrogen Hub entry was ranked by Rystad Energy among the top ten likely to secure funding from the Department of Energy's regional clean hydrogen hubs program.
In December of last year, the DCC was awarded the Solar Impulse Foundation's prestigious "Solar Impulse Efficient Solution" label, recognizing profitable solutions to protect the environment.
Why This Sector?
Jericho Energy Ventures is well positioned to straddle the hydrogen market, being both a producer of this valuable industrial gas and a provider of the top-end equipment required for the industry to get the most out of this resource. The US$198 billion district heating sector is only one facet of the expanding hydrogen market.
According to a report from Grand View Research, "the global hydrogen generation market size was valued at US$155.35 billion in 2022 and is expected to expand at a compound annual growth rate (CAGR) of 9.3% from 2023 to 2030."
In December of last year, the DCC was awarded the Solar Impulse Foundation's prestigious "Solar Impulse Efficient Solution" label, recognizing profitable solutions to protect the environment.
"The global electricity demand is anticipated to witness an increase of nearly two-thirds of the current demand over the forecast period. Focus on projects related to distributed power and utility is anticipated to bolster the industry's growth over the forecast period."
The IEA makes a serious case for hydrogen, explaining that the gas is "an increasingly important piece of the net zero emissions by 2050 puzzle."
"The importance of hydrogen in the Net zero Emissions Scenario is reflected in its increasing share in cumulative emission reductions. Strong hydrogen demand growth and the adoption of cleaner technologies for its production thus enable hydrogen and hydrogen-based fuels to play a significant contribution in the Net Zero Emissions Scenario to decarbonize sectors where emissions are hard to abate, such as heavy industry and long-distance transport."
Why This Company?
As already mentioned, an analysis by independent Norwegian research house Rystad Energy predicted that the HALO Hydrogen Hub, of which Jericho Energy Ventures is an important member, "will be among the top ten hydrogen hubs in the running for billions in government funding."
The Regional Clean Hydrogen Hubs program is expected to reveal companies chosen to establish up to 10 hydrogen hubs across the USA this fall, a contract valued at some US$7 billion.
Rystad listed the HALO Hydrogen Hub as the second out of the ten projects named as favorites. It includes projects in Oklahoma, Arkansas, and Louisiana with partners including Air Products, Baker Hughes, Cherokee Nation, GE, NextEra, and Woodside. HALO is one of 22 projects that submitted a full application to the program.
"We are maintaining our BUY rating and CA$ 0.50/share target price on JEV," a report from Atrium Research noted.
Marina Domingues, senior analyst at Rystad's Clean Tech team, told Hydrogen Insight that "The hubs will show the financial community where they can invest their money and get their return."
"[The program] reduces the technical risk because the government is investing, and because demand is baked into the proposal, it makes hydrogen projects more bankable."
While Jericho Energy Ventures started as an oil company, it is pivoting hard toward green energy, using profits from its oil and gas assets to fund investments in zero-emission hydrogen technologies.
Why Now? Patent Secured, Hub Program Potential
On August 3, Technical Analyst Clive Maund wrote of Jericho Energy Ventures, saying, "There has been mounting interest in the company's hydrogen-powered boilers, and about a week ago, the stock broke out of a base pattern. The minor reaction of the past few days has provided a better entry price."
"This morning, there is important news out that the company's hydrogen technology has been chosen by a leading U.S. university to drive sustainable district energy, which is thought likely to get the stock moving higher again."
This was followed, on August 28, by an in-depth report from Atrium Research, which explained that "Friday after market close, Jericho Energy Ventures Inc. reported Q2 financial results that were softer than our expectations for its Oklahoma O&G joint venture. The JV reported revenue of CA$ 2.0M and adjusted EBITDA of CA$ 0.2M, declining YoY due to lower commodity prices."
"We remind readers," the analysts explained, "that while Jericho's Oklahoma assets form ~40% of our valuation, most of the upside and stock movement is coming from its hydrogen investments, which have been performing exceptionally well. We are maintaining our BUY rating and CA$ 0.50/share target price on JEV."
The analysis goes on to say that "Jericho plans to commence drilling in Q3, which will be funded using cash flow as well as through its drilling partners. Management is also expecting drilling activities out of its Blaine County assets this year after selling in 2022 and retaining a royalty. As for its clean energy portfolio, JEV plans to continue evaluating and consolidating innovative technologies with the objective of offering a complete industrial lower emissions solution."
"On August 3rd, JEV announced that an unnamed prominent Western University
elected to adopt HT's DCC steam boiler for deployment within the university's district heat system. The solution will provide sustainable and low-carbon heating to the university, assisting in its decarbonization goals and setting a precedent for other institutions to follow."
"Management also stated that 1,173 universities and colleges across the world have plans to reduce emissions by 2030 and reach net-zero by 2050, providing ample opportunities for HT to expand into."
Streetwise Ownership Overview*
Jericho Energy Ventures Inc. (JEV:TSX.V; JROOF:OTC; JLM:FSE)
More than 660 district energy systems are operating in the United States, providing heating to an estimated 5.5 billion square feet of floor space for everything from universities to business districts to hospitals and airports, according to a U.S. Energy Information report.
Ownership and Share Structure
Around 35% of Jericho's shares are held by management, insiders, and insider institutional investors, the company said.
They include CEO Brian Williamson, who owns 1.25% or about 3.1 million shares; founder Allen William Wilson, who owns 0.79% or about 1.97 million shares; and board member Nicholas Baxter, who owns 0.46%, or about 1.14 million shares, according to Reuters.
Around 10% of shares are held by non-insider institutions, and 65% are in retail, the company said.
JEV's market cap is CA$ 63.43 million, and it trades in a 52-week range of CA$ 0.44 and CA$ 0.22. It has 248.14 million shares outstanding, 178.38 million of them floating.
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Important Disclosures:
- Jericho Energy Ventures Inc. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.
- As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Jericho Energy Ventures Inc.
- Owen Ferguson wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor.
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