June 29, 2022

Hydrogen Future Industries Plc – Hydrogen Generation System Development Update

May 26, 2022

Hydrogen Future Industries plc

(“HFI” or the “Company”)

Hydrogen Generation System Development Update

Hydrogen Future Industries PLC (AQSE:HFI), a developer of proprietary water-based and wind-powered green hydrogen production systems, is pleased to provide an update on development progress following the formation of March 2022 of HFI Energy Systems Limited (“HESL”), the Company’s wholly-owned product development subsidiary. HESL is part of a group of companies which will include HESL as a holding company, another wholly owned IP development company (HFI Development Limited) and another joint venture IP holding company (HFI IP Holdings Limited). ), which were newly incorporated (together, the “HESL Group”).

Objectives of the HESL Group

HESL was created in collaboration with a wind engineer, and now CEO of HESL, Timothy Blake develop and commercialize proprietary technologies based on the development work led by Mr. Blake that the directors of the Company believe will have a significant positive impact on the hydrogen generation market by significantly reducing the cost of hydrogen production green hydrogen.

The most advanced system being developed by the HESL Group (currently comprised of HESL) is a wind-powered hydrogen generation system combined with electrolyser technologies that aims to generate hydrogen for less than $2 per kilogram – significantly lower than other green hydrogen production systems ranging from $4 for $6 per kilogram, and in line with the 2030 global target.

Administrators believe the HESL Group system will be a smaller, quieter, safer and more efficient alternative to existing open-rotor wind turbines, using advanced aerodynamics and rotor blade design, as well as a drive system intelligent hydraulics, which will result in significant benefits including reduced weight and cost, simplified installation and maintenance, and standardized transport, with components fitted inside shipping containers.

Based on the development work to date, the directors believe that the system will achieve a significant increase in power generation over an open rotor wind turbine of the same overall diameter, allowing the HESL Group to potentially produce hydrogen in a cost-effective way.

The HESL Group intends to integrate hydrogen compression and on-demand energy storage technology, allowing energy to be stored in the form of hydrogen at a fraction of the cost of storing lithium-ion batteries. ion, solving the challenges faced by current wind farms during periods of reduced energy demand.

The system developed by the HESL Group aims to generate hydrogen from a choice of feedstocks, including waste or contaminated water, salt or fresh water and sanitation processes, meaning that ‘It can be operated in a variety of settings, including offshore, mining and industrial. It could also provide constant electricity at costs up to 50% lower than current wind turbines, while cutting investment costs per megawatt of electricity produced by nearly half.

Development progress and roadmap

The current primary focus of the HESL Group is to develop a wind turbine based on Mr. Blake’s historic work that is undergoing independently verified wind tunnel testing. Work has been underway since the inception of HESL to leverage the data generated during testing and simulations for the installation of a test system under real conditions. This includes testing wind speed throughput through the turbine and improving the efficiency of the electrolyser. Where necessary and appropriate, the HESL Group will acquire or register patents to protect intellectual property under development.

Construction of an automated tower for the wind turbine has begun for outdoor installation later this year. The prototype unit will be 12 meters high with a wind turbine diameter of 1 meter and is expected to be built shortly. Administrators anticipate that the prototype unit will be tested for several months before the first commercial-scale units are built for testing and certification at or above 20 meters high with a wind turbine diameter of 5 meters.

HFI is committed to hiring a minimum of $1 million development of test units and the economic interest in all intellectual property developed by Mr. Blake and the HESL Group (or any additional subsidiaries that he may incorporate in the future) will be split 51% to 49% between the Company and Mr. Blake, respectively.

David OrmerodExecutive Director of HFI, said:

We are making excellent progress and are preparing for the installation of the 1 meter diameter wind turbine prototype, potentially as early as next month. This milestone will mark the start of an extremely important period of testing and data collection which will feed into the construction of the first commercial scale units of 5 meters in diameter.

Existing renewable energy-based hydrogen systems do not reach the production cost levels that will be required for widespread hydrogen adoption, particularly in the transportation sector. Based on the extensive development work undertaken to date, we believe HESL’s system could meet and exceed the target cost of hydrogen without the need for government subsidies.

This announcement contains inside information for the purposes of UK market abuse regulations and the directors of the Company accept responsibility for the content of this announcement.

ENDS

Requests:

Hydrogen Future Industries plc

Daniel Maling
David Ormerod

+44 (0)20 3475 6834

Vigo Consulting (Investor Relations)

Ben Simons

+44 (0) 20 7390 0230

Olivier Clark

Cairn Financial Advisers LLP (AQSE business adviser)

Ludovic Lazzaretti
Liam Murray

+44 (0) 20 72130 880

Peterhouse Capital Limited (broker)

Duncan Vasey

+44 (0) 20 7469 0930

To note:

Certain statements made in this announcement are forward-looking statements. These forward-looking statements are not historical facts but rather are based on the Company’s current expectations, estimates and projections regarding its industry; his beliefs; and assumptions. Words such as “anticipates”, “expects”, “intends”, “plans”, “believes”, “seeks”, “estimates” and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and other factors, some of which are beyond the Company’s control, are difficult to predict and could cause actual results differ materially from those expressed or anticipated in the forward-looking statements. The Company cautions securityholders and potential securityholders not to place undue reliance on these forward-looking statements, which reflect the Company’s views only as of the date of this announcement. Forward-looking statements made in this announcement relate only to events as of the date the statements are made. The Company undertakes no obligation to publicly release revisions or updates to these forward-looking statements to reflect unforeseen events, circumstances or developments occurring after the date of this announcement, except as required by law or any applicable regulatory authority. ‘required.