I really don't want anyone to jump off the deep end over Veridium, it is a speculative stock. 2 months ago I would not have touched it with a ten foot pole.
Recent developments, however have convinced me to place a sizable portion of my portfolio in Veridium.
I love their business model, normally one would expect to just sell a turn key system to a customer, offer maintenance assistance, and basically just move on. Veridium instead gives them the turn key system with no upfront cost, but receives in return a contract for the life of the system to be able to buy at a significant reduction from market all of the production of this turn key system. For a system that costs Veridium about $1,000,000 Veridium receives an income stream for the next XX years of about $1.5-$1.8 million per year. This is for the average sized ethanol producer. Larger installations will produce higher income streams.
This system is adaptable, so far 4 ethanol refineries have adopted it, and with additions to this technology Veridium can extract the usable fats from the effluent stream of meat packing plants. One meat packing plant has presently opted for this technology. Creating an income stream of better than $2.1 million.
A nice thing is to wake up Monday mornings lately. Veridium has for the past 6 weeks announced new contracts in this area 4 ethanol plants, 1 meat packing plant and an agreement with sister company Mean Green Biofuels to sell Mean Green the oils the extraction system produces at a fixed discount to the finished fuel price, this will correspond to a premium over corn oil prices.
Dreaming a little, I expect continuing announcements on Monday mornings of new sales of these contracts.
Veridium has stated it expects to saturate the ethanol industry with it's Corn Oil Extraction System(TM). Should that happen there are presently 66 ethanol plants in the US, and some corn - ethanol plants in Europe either existing now or under construction. Taking just the present US plants should Veridium sell 6 more the income stream would jump by $10 million. 12 more and the income stream would jump by 20 million, sell them all and the income stream would jump by $100 million. Some where in the middle is a probable certainty. If you walked into my factory producing $75 million per year and proved to me you could increase my bottom line (profit) by $1.5 million I would not let you out the door until we had signed the deal.
Add to the ethanol plants meat packing plants, and I have no idea where it will go. I do know the meat packing plants have a big problem separating the blood, fat, protein, etc. from their effluent waste water stream, and then disposing of the muck. Might I add expensive problem. Veridium offers a new free $2,000,000 dollar addition to the bottom line while reducing this muck that is output by 80%. It is a no brainer once again. Were I the president of the meat packing plant, I would lock you in until you signed the deal.
I like to dream, can you imagine 50 ethanol refineries and 50 meat packing plants in a year? It is a dream that just might could come true. If not in a year then maybe two?
Veridium has one other technology that excites me. Ethanol refineries emit megatons of carbon dioxide from the fermentation process. Veridium has a reasonably small footprint size reactor system that feeds the carbon dioxide and sunlight to algae which then die fall to the bottom and are removed several times a day. These algae are 94% starch and 6% oil and can be feed right back into the refinery as feed stock, producing more ethanol for the refinery and more Oil for Veridium.
This technology is scalable, it can be applied to any carbon dioxide stream, like coal/natural gas/petroleum/biomass power stations. Can you envision 4 corners. It not only removes the carbon dioxide it also removes most other pollutants.
With the increasing moves towards licensing carbon dioxide emissions this technology may be on the edge of explosion.
Please do your own Due Diligence.
Veridium is facing a huge growth boom, it is questionable whether they can handle it alone. They are just a couple of months past having their auditor declare they were in imminent danger of bankruptcy.
They also just greatly expanded the stock outstanding. Their income now justifies the present price and more even with the increased stock outstanding.
May I repeat do your own due diligence.
r |
