This could be the Holy Grail as far as technology goes. Imagine taking garbage from a landfill and turning it into renewable diesel fuel. That’s actually what Alberta-based Cielo Waste Solutions Corp. (CSE: CMC) is expecting to do with its unique innovation.
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Simply put, the process involves feeding waste into its refinery using motor oil to move the process along so that it doesn’t clog up. Next, the garbage is liquefied by heating it to 280 degrees Celsius. The company then adds a catalyst, its own recipe comprised of various rare minerals, after which it is distilled into a renewable diesel fuel.
Cielo estimates that one tonne of waste can produce 700 litres of low-sulfur diesel by using its patented process. It is also able to utilize between 90% and 95% of the landfill in each site, which makes it one of the most environmentally-friendly companies in its space. Cielo Waste Solutions took an important step in its corporate development with its July 21, 2014 announcement that it would receive funding of up to $10 million from a private investor group for the construction of the company’s first 700 liter per hour commercial scale renewable diesel refinery. This group would also have the right of first refusal to provide additional funding of up to $1 billion to build as many as 100 additional 700 liter per hour refineries throughout Canada.
In consideration, the investor group will receive 50% ownership of the intellectual property associated with the refining technology, 90% of net revenues from the first refinery until the funding is repaid, and thereafter a 70% ownership of the new refinery. Cielo will pay $500,000 to the investors for each refinery sold but will also receive a royalty equal to $0.02 per litre from all refineries.
“Each plant will generate about $4.8 million in EBITDA and another approximately $3 million in carbon and methane credits, but that’s just a projected forecast,” said Cielo Waste Solutions President Don Allan, in an interview with SmallCapPower.com.
Mr. Allan explained that Cielo has a $49 million off take agreement in place with Ballard Biofuels at a $1.30 per litre. Ballard Biofuels has agreed to purchase all of the fuel created from its first six refineries, up to 10 million gallons per year.
Cielo Waste Solutions has little debt and it expects to be consistently cash flow positive by the fourth quarter of this year. The company currently has 48.6million shares outstanding.
To learn more about Cielo Waste Solutions please visit their SmallCapPower.com Investor Hub: Here
About Cielo Waste Solutions Corp.:
Cielo specializes in environmentally advanced technologies focused on materials recovery, renewable diesel and landfill reduction through responsible diversion practices. By incorporating the latest material recovery technologies, Cielo is able to achieve significant diversion from landfills while creating a feedstock specifically for renewable diesel. Cielo provides solutions for responsible waste management while also providing value added opportunities. For more information please visit the Company’s website at www.cielows.com
Disclosure
Ubika Research has received compensation from Cielo Waste Solutions to provide analyst research coverage. For full disclosure please visit: Here
About Ubika Research
Ubika is an investment research and capital market services firm based in Toronto and Vancouver with a proven track record of identifying and launching coverage of high potential small cap stocks at an early stage, thus offering timely market insights. Its specialty is small-cap companies with a market capitalization of <$5 billion.
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