In this InvestorIntel interview, Tracy Weslosky talks with Zentek Ltd.‘s (NASDAQ: ZTEK | TSXV: ZEN) CEO and Director Greg Fenton about the successful testing of its “best-in-class” icephobic coating for drones, first in wind tunnels and then real-world conditions.

While the drone with uncoated propeller blades rapidly lost the ability to maintain flight in an outdoor icing environment, Greg discusses how the drone coated with Zentek’s icephobic coating prevented ice from adhering to the surface and was able to maintain flight until the end of the battery life. Greg explains how Zentek is positioned to potentially be the only company in Canada with a product to help drones fly in winter conditions to meet Transport Canada’s anti-icing requirements for drones.

Greg also provides an update on Zentek’s Albany Graphite Project. With an increased demand for North American battery supply chains, Greg discusses how there has been a renewed market interest in their Albany graphite project. Recognizing this, Greg talks about Zentek’s decision to resume work on the project and transfer the project to its wholly-owned subsidiary Albany Graphite Corp., to secure funding for its development and attract investors, including discussions with battery manufacturers and car companies.

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About Zentek Ltd.

Zentek is a graphene technology company focused on the research, development, and commercialization of graphene-based novel products to give its commercial partners a competitive advantage by making their products better, safer, and greener.

Zentek’s patented ZenGUARD™ coating is shown to have 99-per-cent anti-microbial activity and to significantly increase the bacterial and viral filtration efficiency of both surgical masks and HVAC systems. Zentek’s ZenGUARD™ production facility is located in Guelph, Ont. Zentek’s second technology is the patent-pending ZenARMOR™ platform focused on corrosion protection applications.

To know more about Zentek Ltd., click here

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Ice build-up on wind turbines, airplanes, and cars in cold regions is a real problem. For example, Texas residents may remember the February 2021 ice storms and extreme cold weather that hit south-central USA. The storm resulted in over 4.5 million homes and businesses being without power for several days. Frozen gas lines and ice buildup on wind turbines were key factors in the power failure as wind generation dropped by almost 50% over the entire state of Texas.

The airline industry spends significant time and money ‘deicing’ (removing ice and snow build-up) on their planes before take-off. Consumers in cold countries often have to do the same with their car windscreen. The drone market is another industry where deicing is important.

Now there is a better solution to de-icing. Today’s company has developed an ‘icephobic coating’ technology that is effective at preventing ice build-up. ‘Icephobic’ effectively translates to ‘repelling ice’. It is also sometimes referred to as ‘ice-resistant coating’.

The global market for ice-resistant (icephobic) coatings

It has been reported that the global market for ice-resistant coatings is forecast to reach more than $1 billion in 2023, growing at a CAGR of 23.3%.

An excerpt from a 2021 report on the ice-resistant coatings and surfaces market

Source: ResearchAndMarkets

Zentek Ltd. (NASDAQ: ZTEK | TSXV: ZEN) announced in September strong test results supporting their patent-pending, graphene-based, icephobic coating technology. The testing concluded that Zentek’s icephobic technology is durable in adverse conditions for both wind turbine and drone industries, which are the initial focus markets for Zentek’s icephobic coating.

Zentek state that their icephobic “coatings have demonstrated an adhesion strength repeatedly around 20 kPa (results under 100 kPa are considered to demonstrate low adhesion), a significant improvement over the current commercial products. Testing at the National Research Council (NRC) and Anti-icing Materials International Laboratory (AMIL) in Quebec is ongoing.”

Some of the September announcement highlights included:

• “Flight tests in real-world icing conditions demonstrated good performance of Zentek’s coating, with results indicating retardation of ice accretion (icephobicity) and low adhesion to accreted ice….
• Sand erosion testing demonstrated medium to good performance at a high speed of 540 km/h.
• Rain erosion testing at AMIL demonstrated good performance at 160 km/h and 320 km/h based on our interpretation, speeds at which the leading edge of wind turbines blade tips are exposed.
• NRC drone testing demonstrated consistent results of maintaining control of rotor thrust in icing conditions…..
• Zentek has filed a full patent application with the Patent Cooperation Treaty, the international patent office, on August 2^nd, 2022, for Nanomaterial-Enhanced Elastomer for Passive Ice Accretion Prevention.”

Source

Icephobic coatings have many applications and significant demand

An exciting part of the above news is the potential for Zentek’s technology to be used in a huge variety of uses globally, particularly the energy and aviation/aerospace industries.

Zentek states:

“Commercial applications of our patent-pending coating could be used in drone technologies allowing for efficient all-weather operation. Other additional applications include powerlines, large wind turbines, ship structures (railings, etc.), and oil rigs, especially in Arctic operations, along with tall buildings where ice buildup could pose a public hazard.”

Icephobic coatings could revolutionize aviation and wind power generation industries

Source: Zentek website/icephobics

In addition to their icephobic coatings Zentek is also advancing multiple other initiatives including the commercialization of their “Canada patent allowed” ZenGUARD™ (a ‘graphene-silver coating’ shown to have 99% antimicrobial activity used on masks or PPE, also used in HVAC systems to improve air quality), aptamer enabled Pathogen Detection Technology, anti-inflammatory therapies, fuel additives (to reduce carbon emissions), conductive filaments for 3D printing, fire retardant coatings, and graphene wrapped silicon anodes for batteries.

Zentek Ltd. trades on a market cap of C$235 million on the TSXV or US$175 million on the Nasdaq.

Every once in a while investors will come across a ‘wow’ company. This is a company that just wows you with their performance and their stock price.

For me the ‘wow’ company of the last year is Zentek Ltd. (NASDAQ: ZTEK | TSXV: ZEN). Just take a look at the stock chart below, showing the stock rising a staggering 9.7x over the past approximately year and a half. The good news for investors is that the recent pullback allows for a better entry price than when the stock peaked at C$6.50.

Zentek Ltd (TSXV: ZEN) 5 year stock price chart

Source: Yahoo Finance

Today I give a brief summary of Zentek for new investors and an update on their progress in 2022.

Zentek’s business summary

Zentek describe themselves as “an IP development and commercialization company focused on next-gen healthcare solutions in the areas of prevention, detection and treatment.” I prefer to think of them as a nanotechnology and graphene company (they were formerly known as ZEN Graphene Solutions) that has expanded into multiple areas of commercialization; particularly into the healthcare sector with a product for prevention, detection and treatment of numerous pathogens.

Areas/products of commercialization for Zentek include:

• ZenGUARD™ – A patent-pending ‘graphene-silver coating’ shown to have 99% antimicrobial activity, including against COVID-19. The coating can be used for PPE applications (including nitrile gloves, gowns, footwear coverings and surgical caps) and also in air purifiers. According to Zentek: “ZenGUARD™-coated masks removed 98.9% more bacteria and 97.8% more virus compared to a typical ASTM Level 3, 3-ply uncoated, resulting in over 99.99% BFE and VFE ratings.” ZenGUARD™ has Health Canada approval (Medical Device Establishment License, “MDEL”) and production facilities are being readied for first orders.  Zentek is commercializing ZENGuard^TM with mask manufacturer Trebor Rx, but can also work with other manufacturers.
• Pathogen Detection Technology (aptamer-enabled) – A low cost, rapid, saliva testing, scalable technology to detect numerous pathogens, initially to be used for COVID-19 testing.
• Antimicrobial therapies – In-vitro testing shows 99.9% effectiveness against bacteria, fungi and viruses.
• Air conditioner filter coating – Zentek has experimented with past partners to use graphene oxide coated filters to help remove moisture from the air and make air conditioners up to 75% more energy efficient.
• Icephobic graphene coatings – Potential to significantly increase safety for vehicles such as drones, aircraft, ocean vessels, wind turbines, and other applications where, in cold weather climates, there is the potential for ice to accrete on surfaces. An ‘icephobic’ surface repels ice build up.
• Others – Graphene tires, graphene in concrete, fuel additives (potential to reduce GHG emissions from diesel and bio-diesel fuels by as much as 10%), and graphene for batteries.

Zentek’s latest news and progress in 2022

Zentek announced on February 18, 2022 the development of graphene-wrapped silicon anodes. Zentek CEO Greg Fenton stated: “Not only were the researchers able to demonstrate good performance with laboratory-scale half-cells, the performance was also validated with commercial lithium iron phosphate cathodes suggesting they could be a drop-in solution for enhancing already available battery technologies. We look forward to continuing our support of their research and development to potentially bring this technology to market. The company has begun discussions with a potential industry partner.”

As reported on February 28, 2022, Zentek’s Guelph production facility is now fully licensed and permitted for ZenGUARD™ production and substantially all equipment has been received to ramp-up industrial scale capacity. First orders have been received and the ZenGUARD™ international patent is due shortly. As reported on January 13, Zentek has entered into a binding letter of intent with GMAF Circular Medico ApS to produce and sell ZENGuard™-enhanced GMAF trademarked recyclable surgical masks.

With regards to the Pathogen Detection Technology, Zentek continues to work to bring the product to market as soon as practicable, which will require having a working prototype prepared, having conducted baseline studies, and having made applications to regulatory bodies.

With regards to Zentek’s icephobic coatings, they are currently undergoing full flight trials on a specially equipped research aircraft under real world ice-forming weather conditions.

Zentek’s new manufacturing facility in Guelph, Ontario, Canada is set for commissioning shortly

Source: Zentek website

Closing remarks

Zentek really is a ‘wow’ company with enormous potential to tap into several multi-billion dollar industries. Focusing on pathogens (viruses, bacteria, fungi) prevention, detection, and treatment is simply staggering. Then there are multiple other applications for Zentek’s products, the most recent being graphene-wrapped silicon anodes that can potentially be used to create better EV batteries and the icephobic coatings opportunity.

In terms of commercialization, Zentek is already advancing with ZenGUARD™ in terms of a production facility and orders, with the ZenGUARD™ patent due very soon and production from Zentek’s new Guelph facility set to begin very soon.

Finally, Zentek is now getting the exposure it deserves with a NASDAQ listing that began on March 22, 2022, under the ticker “ZTEK”. Not surprisingly the stock rose 25.93% on March 23.

Zentek has C$32 million in cash, no debt, and looks like being a ‘wow’ company again in 2022. Stay tuned.

Disclosure: The author is long Zentek (TSXV: ZEN).