Nel ASA: Has signed a licensing agreement with Reliance

Rhea-AI Summary

On May 21, 2024, Nel ASA's subsidiary, Nel Hydrogen Electrolyser, signed a technology licensing agreement with Reliance Industries (RIL). The agreement grants RIL an exclusive license for Nel's alkaline electrolysers in India and permits global manufacturing for internal use. This partnership aims to support RIL's ambitions in renewable hydrogen production and provides Nel with access to a rapidly growing market. The collaboration focuses on future performance improvements and cost optimization through R&D. Nel can also procure equipment from RIL for its projects while continuing to serve the Indian market with other technology platforms.

Positive

• Nel ASA enters into a lucrative licensing agreement with Reliance Industries (RIL).
• Agreement allows RIL exclusive rights to manufacture Nel's alkaline electrolysers in India.
• Provides Nel access to a significant and growing market through RIL's global reach.
• Potential for future performance improvements and cost optimization through joint R&D.
• Nel can procure equipment from RIL for its own projects.

Negative

• Agreement may lead to increased dependency on RIL for market access and revenue streams.
• RIL has commercialization and global manufacturing rights, possibly limiting Nel's direct market control.

OSLO, Norway, May 21, 2024 /PRNewswire/ -- Nel Hydrogen Electrolyser AS, a fully owned subsidiary of Nel ASA (Nel),(OSE: NEL), has entered into a technology licensing agreement with Reliance Industries Limited (RIL). The agreement provides RIL with an exclusive license for Nel's alkaline electrolysers in India and also allows RIL to manufacture Nel's alkaline electrolysers for captive purposes globally.

"The signing of this agreement is a great milestone in Nel's history. Reliance is an impressive company with enormous ambitions as a global producer of renewable hydrogen, and I am proud that they have selected Nel as their technology partner. In addition to supporting Reliance in achieving their global aspirations, Nel will through this agreement get a revenue stream from a rapidly growing market Nel could not have accessed on its own," says Nel's President and CEO, Håkon Volldal.

RIL is a Fortune 500 company and India's largest private sector corporation. The company is renowned for its capacity to execute large-scale projects and robust investments in technology and innovation. RIL is building a multi-GW fully integrated end-to-end new energy value chain, from photon to green molecules, paving the way for abundant and affordable access to sustainable energy for everyone, as per the vision set by RIL's Chairman and Managing Director, Mr. Mukesh Ambani. Green hydrogen is a critical element of the new energy value chain – and the partnership between RIL and Nel in relation to alkaline electrolysers is an important milestone towards the sustainable energy future.  

Through the agreement, Reliance gets access to Nel's leading, proven technology platform for manufacturing electrolysers. RIL has successfully built multiple businesses of truly global scale. This partnership of Nel's robust technology platform with RIL's execution prowess – will further add to the success story for both partners.

Both partners will also collaborate on future performance improvements and cost optimization through research and development (R&D), value engineering, standardization and modularization to improve the competitiveness of the alkaline technology platform.

According to the agreement, Nel can procure equipment from Reliance for its own projects. Nel will continue to serve the Indian market with technology platforms that are not covered by the agreement.

For additional information, please contact:

Kjell Christian Bjørnsen, CFO, +47 917 02 097
Lars Nermoen, Head of Communications, +47 902 40 153

About Nel ASA | www.nelhydrogen.com

Nel has a history tracing back to 1927 and is today a leading pure play hydrogen technology company with a global presence. The company specializes in electrolyser technology for production of renewable hydrogen, and hydrogen fueling equipment for road-going vehicles. Nel's product offerings are key enablers for a green hydrogen economy, making it possible to decarbonize various industries such as transportation, refining, steel, and ammonia.

About RIL | www.ril.com

Reliance is India's largest private sector company, with a consolidated turnover of INR 974,864 crore (USD 118.6 billion), cash profit of INR 1,25,951 crore (USD 15.3 billion), and net profit of INR 73,670 crore (USD 9.0 billion) for the year ended March 31, 2023. Reliance's activities span hydrocarbon exploration and production, petroleum refining and marketing, petrochemicals, advanced materials and composites, renewables, retail and digital services.

Currently ranking 88th, Reliance is the largest private sector company from India to feature in Fortune's Global 500 list of "World's Largest Companies" for 2023. The company stands 45th in the Forbes Global 2000 rankings of "World's Largest Public Companies" for 2023 -top-most among Indian companies. Reliance has been ranked among the world's 20 best companies to work with, highest amongst Indian companies in Forbes' World's Best Employers for 2022. It features among LinkedIn's "Top Companies 2023: The 25 Best Workplaces to Grow Your Career in India

This information is subject to a duty of disclosure pursuant to Section 5-12 of the Norwegian Securities Trading Act. This information was issued as inside information pursuant to the EU Market Abuse Regulation, and was published by Kjell Christian Bjørnsen, CFO, at NEL ASA on the date and time provided.

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SOURCE NEL ASA

FAQ

What is the significance of Nel ASA's agreement with Reliance Industries ?

The agreement grants RIL exclusive rights to use and manufacture Nel's alkaline electrolysers in India, providing Nel access to a growing renewable hydrogen market.

How does the Nel-Reliance agreement impact Nel's market reach?

The agreement enables Nel to enter the Indian market and leverage RIL's global scale for broader market access.

What benefits does Nel ASA gain from the partnership with RIL?

Nel gains a revenue stream from a growing market, potential for R&D collaboration, and the ability to procure equipment from RIL for its projects.

What rights does Reliance Industries have under the agreement with Nel ASA?

RIL has exclusive rights to use and manufacture Nel's alkaline electrolysers in India and for internal global purposes.

What potential risks does Nel face with the agreement with Reliance Industries ?

Potential risks include increased dependency on RIL and direct control over the commercialization and manufacturing of its technology.