Coates International Ltd (OTCMKTS:COTE)
Yesterday Coates International Ltd (OTCMKTS:COTE) released an announcement that had some eye-popping numbers. Coates will be supplying 40 to 50 of its patent-protected SCRV industrial electric power generators to a $412 million solar project in Mexico. Revenues for the entire contract are projected at around $40 million over three years. The order was announced after notification had been received from Secure Supplies Mexico LLC.
This notice comes after the December signing of a licensing agreement between Secure Supplies Mexico LLC and Secure Supplies USA LLC. The licensing agreement. Terms of that agreement included the payment of $1 million within 10 days followed by funding a 50% deposit by the end of January 2017 totaling $30 million for the initial 60 One MW Generator sets.
At the heart of Coates International Ltd (OTCMKTS:COTE) business is Coates patented CSRV system. The development of the high-tech engine resulted from the federal laws that set out to remove lead additives from fuels and reduce pollution. Those laws also reduced engine efficiency. The Coates Spherical Rotary Valve Engine (CSRV) is a valve system that is installed in engines and replaces the traditional poppet valve system which regulates the airflow.
According to Coates, a five-liter poppet valve engine produces airflow at a rate of 133 cubic feet per minute. When replaced with the CSRV, that same engine produces airflow at a rate of 319 cubic feet per minute. Additionally, the poppet valve engine produced 5,700 RPMs and the CSRV engine produced 14,850 RPM. Due to the CSRV valves rotation and venting, a lower combustion chamber temperature is achieved which allows for a high compression ratio and more efficient power output.
Coates International Ltd (OTCMKTS:COTE) will be fitting Cummins V-12 engines with the CSRV. The engines will run on gaseous hydrogen produced by solar panels that are to be erected by Secure Supplies Mexico LLC. The hydrogen produced by the solar panels is stored and will be used to power the CSRV fitted engines when the sun sets. This project is considered by some to be one of the “greenest” in North America.
The CEO of Coates International Ltd (OTCMKTS:COTE), George J. Coates, commented that he believes this contract is a major milestone for the company and will benefit all of those involved.
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About the author: Marc has a degree in economics and a MSc. in Finance. Over his 20-year career, Marc has worked for global investment firms in Europe and the United States as an analyst, fund manager, and consultant.