2024 Energy Forecast: Global Adversity Creates Clarity for Frontieras’ State-of-the-Art Processing Technology
February 5th. 2024
Written by Matthew McKean, CEO and co-founder of Frontieras North America (LinkedIn)
When I think about Frontieras North America and the year ahead, I ponder the quote “Rock & Hammer” by Jacob Riis. “When nothing seems to help, I go and look at a stonecutter hammering away at his rock perhaps a hundred times without as much as a crack showing in it. Yet at the hundred and first blow it will split in two and I know it was not that blow that did it, but all that had gone before.”
This quote, first introduced to me by legendary NBA coach Gregg Popovich, represents what I am anticipating in 2024 for Frontieras. Frontieras’ management team has built the foundation for the company over the past decade, and I anticipate that in 2024, we will “hammer through” and see the successful implementation of our strategic objectives of delivering abundant, affordable, and available energy.
In 2024, Frontieras anticipates closing additional equity, completing next phase engineering, and project financing. Equity raised will accelerate Frontieras’ engineering, which includes detailed construction drawings that allow Frontieras to complete open contractor bids. Once that is complete, Frontieras can close project debt finance, break-ground on site prep, and commence construction on its first plant.
The above accomplishments will be exciting milestones for Frontieras and we predict, will be layered on top of a global energy market that is poised to be a rollercoaster in 2024. Outlined below are the four major catalysts that will influence the energy market in 2024:
1. Political Upheaval: Forty percent of the world's major powers, including the U.S. and Russia, are facing elections at the highest levels. Writing with an emphasis on the United States elections, we tried to summarize what we think will happen with a Joe Biden reelection versus the election of GOP frontrunner Donald Trump. A Biden victory would boost renewable energy investments, stricter environmental regulations, and potential restrictions on fossil fuel production. This could create short-term disruptions and raise energy costs. Conversely, a Trump win would likely see a resurgence of fossil fuel dominance, with deregulation, increased drilling permits, and tax breaks for the industry. This could boost domestic energy production and lower short-term energy costs. Frontieras straddles the two worlds and believes that it will succeed regardless of who is elected. FASForm, the proprietary patented technology designed by Frontieras’ parent company, Frontier Applied Sciences, is a validated commercial technology that produces large volumes of market-ready liquid hydrocarbons from the world’s most abundant energy source, coal, and other volatile-rich solid carbonaceous materials, including waste plastics.
2. High interest rates and a tight funding market are set to carryover from 2023. The combination of the two presents a headwind for large-scale projects that require hefty upfront investments with volatile financial returns on the backend. The increased cost of borrowing creates risky propositions, such as unproven green projects like solar farms which depend upon developer tax credits, even more daunting. Financial proformas of Frontieras’ FASForm commercial technology forecast substantial profit margins that are largely unaffected and hedged against the current elevated cost of capital. Moreover, margins are “real market” and have zero reliance upon subsidies or carbon credits.
3. Green Agenda: As 2023 was winding down, we began to witness growing opposition to the Green Agenda. In a nutshell, we are witnessing electric vehicle sales sputter, persistent power crises happening across the globe, and growing public discontent towards costly renewable subsidies. This growing backlash is poised to have a significant impact on 2024 and will likely result in impairing or eliminating the “blank check phenomenon” that has been given to unprofitable projects aligned with ESG that can only exist with significant taxpayer subsidies. Frontieras’ solution processes hydrocarbons with state-of-the-art technology that maximizes yields and lowers emissions in a highly profitable way, free of government subsidies.
4. Stock Market Set to Roar: Amidst this global churn, the U.S. stock market might offer a beacon of stability. While the NASDAQ and S&P 500 could face choppier waters, the DOW is predicted to stay on a bullish course. The continued support of the markets illustrates investors prioritizing reliable returns over adventurous leaps of faith. Frontieras expects capital to flock towards established assets and proven yields, leaving riskier ventures on the back burner. Frontieras maximizes the value of every ton of coal that is processed to produce a higher value and marketable gas, liquid, and solid energy resources.
Energy is as integral to society’s advancement as is clean water and air. Because of energy’s necessity, we cannot go backwards by placing our dependence on unreliable sources like solar and wind. Instead, we must look ahead, and utilize technology and innovation in the energy sector to improve yields and do it in a clean manner.
In 2024, we anticipate that countries, including the United States, will be looking inward toward organizations that can help calm the unease within the energy market and create value in a mature market. The world needs reliable and abundant energy to support the global economy, heat homes, and deliver clean water and food. As 2024 reveals its challenges and opportunities, Frontieras will stay the course to deliver on our mission and continue to hammer away until a crack is created, and the rewards of our efforts are revealed.
My next blog will touch on the value of energy in advancing our society forward. Specifically, we will take a closer look at the pivotal role that energy plays in allowing advancements, including artificial intelligence to move forward.
These perspectives on the global energy market are my own. If you are interested in learning more about Frontieras, its FASForm technology or the Frontieras management team, please visit www.frontieras.com