Market Watch: Another rate cut and a driving force in mobility tech

General Market Commentary

The Bank of Canada once again cut its key interest rate on September 4, 2024, by 25 basis points, landing at 4.25%. With continued easing in broad inflationary pressures, the Governing Council decided to reduce the policy interest rate as the Bank remains resolute in its commitment to restore price stability for Canadians.

In other news, we are seeing some big projects take off in the hydrogen space in Western Canada. UK-based Linde has signed a long-term agreement for the supply of clean hydrogen to Dow’s Fort Saskatchewan Path2Zero Project in Alberta. The company will invest more than $2 billion to build, own and operate a world-scale integrated clean hydrogen and atmospheric gas facility. FortisBC Energy Inc. and VulcanX Energy Corp. have signed a funding agreement to support the development of hydrogen pyrolysis technology that would see zero-emission hydrogen and solid carbon produced from natural gas at a low cost.

Hot Sector News

This month we’re putting the spotlight on ApoSys Technologies Inc., a Mississauga, Ont.-based company that is becoming a driving force in automating the inspection and monitoring processes for transportation infrastructure within the technology sector. The predictive maintenance solutions, data reduction systems, and energy-efficient operational tools optimize operations for various transportation modes, including railways, road networks, airports, and waterways. Launched in 2015, the company continues to make strides and develop innovative technology that recently attracted federal funding.

From left to right: Daniel Sax from the Canadian Space Mining Corporation; Robert Mastrotto and Bilal Haffejee from NGen Canada (foreground); President of the Treasury Board Anita Anand; Aposys Technologies CEO Oliver Wang; Minister Rechie Valdez, Member of Parliament for Mississauga—Streetsville and Minister of Small Business; Peter Fonseca, Member of Parliament, Mississauga East-Cooksville; with guests at the federal funding announcement.

We recently engaged ApoSys Technologies CEO Oliver Wang, along with Gareth Wang, product manager, and Pragya Saxena, data scientist, to provide some insight into the company’s strategic plans and how they are navigating market trends.

ApoSys Technologies was recently approved for funding from the federal Next Generation Manufacturing Canada (NGen) stream. How exactly will this new support be applied?

The NGen funding will catalyze our R&D efforts in maturing Geoforge, our mining Underground GPS technology. Geoforge has been in development in terrestrial mines across Canada since 2021, and currently offers centimeter-accurate Mapping and Positioning as a plug-and-play solution for mining vehicles. Under NGen’s Moonshot 4 Mining, Minerals and Manufacturing (M4M3) initiative, Canada seeks to develop dual-use technologies for both terrestrial and lunar settings, with an emphasis on innovations being asset-light and scalable.

At its baseline, Geoforge’s proprietary algorithms enable real-time localization within mines without the need for satellite-based GPS or other network infrastructure (e.g. Wi-Fi, UWB and RFID). Space is a new and foreign frontier, but we believe that the funding will enable us to figure out the answers. Within terrestrial mines, we envision Geoforge to further integrate with mobility technologies like Collision Avoidance, Advanced Driver Assistance Systems and Autonomous Driving, and we can’t wait to see how that would be applied to lunar mining too!

What do you estimate to be the size of the intelligent mobility management market in Canada, and how are industrial sustainability trends impacting the company’s potential?

Autonomous driving as a whole had an entire hype cycle about five years back, with many service providers like Cruise and Apple rethinking their foray into the mobility sector. However, we see very tangible applications in the mining industry, especially from a safety aspect. The risks posed to miners significantly shrinks when they are able to operate mining vehicles remotely, while productivity will increase if these autonomous mining vehicles can operate and communicate with each other in real time. Allied Market Research expects that demand for mining AVs will surge from US $1.6 billion in 2025 to US $12.5 billion by 2035. This is complemented by industrial robotics expecting to reach USD $352.1 billion by 2030; ApoSys finds itself at a very fortunate intersection between autonomous navigation and robotics, especially as a first-mover with patented, scalable technology.

The reality is that in order for industries to be sustainable, in-situ resource utilization is very much needed to enable the development of green technologies. However, key stakeholders within the mining industry have a growing focus on ensuring the deliberate deployment of each of its mining assets, such that there’s no wastage of fuel, minimized vehicle emissions and efficient operations. ApoSys is poised to augment these strategic efforts by establishing a robust P2P network between autonomous mining vehicles; every route taken by these vehicles would be calculated and optimized.

How do you think current policy and financial incentives will help or hinder the market?

We’ve been blessed with the support we received so far; however, emerging technologies that are adjacent to autonomous mining are relatively nascent, so that can limit the network of partners available to synergize our R&D efforts for commercialization. As a result, more has to be developed by ourselves, which can be a challenge sometimes. It would be great to have half the resources that autonomous driving startups in other sectors have, especially since our use cases are extremely tangible and quantifiable.

What are your company goals for the next few years and how are you setting yourselves apart from the competition?

Our primary goal for the next few years is to further validate and commercialize Geoforge across various mines around the world. We are already in discussions with mining firms across Canada, South Africa and the Middle East for pilot projects and early adoption. With the Ngen support, we also foresee ourselves growing along with Canada’s budding space industry, so that we can sustainably conduct mining operations while ensuring the safety of miners. We also expect to build stronger partnerships with leading mining companies to test Geoforge in real-world environments and gain valuable traction.

Our technology is modular in nature, with a compact setup optimizing a plug-and-play adoption for easy integration with other companies’ systems. As the lunar mining industry unfolds, there will be entrants with their own autonomous technologies; rather than compete directly with them, we ensure that these entrants would not need to spend as much time and effort to R&D a workable mapping and positioning system, which frees up their resources to focus on other operational innovations, such as drilling and mineral processing. On a bigger scale, this efficiency ensures a rapid transition to diverse innovations within autonomous systems, leading Canada’s mining industry to innovate faster, become more productive and competitive.

Is there an appetite to take Aposys Technologies public in future?

At this stage, ApoSys is focused on solidifying our core offerings, expanding our technology applications, and securing more strategic partnerships. While the idea of taking ApoSys public is not off the table, our current priority is to build sustainable growth and further validate our technologies in the market. The important thing is to develop something the market precisely needs. With that said, as we continue to mature and scale, particularly with the ongoing success of Geoforge and our collaborations with partners in mining and space sectors, an IPO could be a future consideration.

Any other comments to share with our readers working in the environment sector?

In the environmental sector, we see immense opportunities to collaborate on technologies that intersect both industrial efficiency and sustainability. As industries move towards automation and greener practices, there’s a growing need for technologies like Geoforge that not only optimize operational performance but also minimize environmental impact. Underground GPS systems, for example, can play a pivotal role in reducing resource waste, energy consumption, and emissions by making operations more precise and less reliant on traditional energy-intensive infrastructure. We also believe in the power of cross-sector collaboration. Environmental sustainability and industrial growth are not mutually exclusive. By working together, we can develop technologies that support efficient resource extraction, smarter infrastructure, and greener industrial practices, ultimately contributing to both environmental goals and economic growth.

Stocks to Watch
Here is a list of Canadian cleantech stocks that we are monitoring for this column. This list of public companies is by no means complete, and we are open to suggestions from our advisors and readers.

*The authors of this column own equity. It is not meant to be an endorsement, but simply a statement of this fact.

James Sbrolla is a veteran of the financial and environmental industries.

Connie Vitello is editor of Environment Journal.

Featured image credit: Getty Images