Shares of Nel, the Norwegian hydrogen company, dropped significantly on Wednesday following the news that one of their customers has cancelled an order. As of 1024 GMT, shares were trading 9.9% lower at NOK6.64.
The cancellation came after HyCC decided to postpone a hydrogen project where Nel’s electrolyzer equipment was supposed to be used. HyCC had initially ordered around 12 million euros ($13 million) worth of equipment for their H2eron green hydrogen plant in Delfzijl, Netherlands. However, due to the project being postponed until at least 2028, the purchase order was ultimately cancelled.
The H2eron project aims to produce sustainable aviation fuel using hydrogen generated at the plant. Unfortunately, regulatory delays and unfavorable market conditions have led to the need for adjustments in the project setup and schedule.
According to Marcel Galjee, the managing director of HyCC, the regulatory framework and market conditions are not currently conducive to executing the project at the desired scale. As a result, they are forced to make changes to ensure the best interests of the H2eron project.
Nel has not recorded any revenue from this particular project, but the cancellation will have a negative impact on their backlog, amounting to approximately EUR12 million.
Despite this setback, Nel and HyCC are still committed to their partnership. They are currently in discussions regarding the utilization of Nel’s alkaline electrolysers in a new setup for the H2eron project. The new setup will have a capacity of up to 50 megawatts.