Loop Industries Q1 2026 Earnings Call Transcript

Quartr
Provided by Quartr
July 16, 2025

Key Takeaways

  • Positive Sentiment: Loop Industries confirmed $176 million CapEx for its India Infinite Loop facility (with a $95 million technology install cost, lowest in the industry), narrowing site selection to two Gujarat locations.
  • Positive Sentiment: Ongoing offtake discussions with leading global apparel brands for textile-to-textile recycled polyester and European beverage companies for high-quality rPET leverage India’s low-cost structure to offer competitive pricing on 100% recycled virgin-quality PET.
  • Positive Sentiment: Modularization plan underway to build process modules in India—signing a $1.5 million engineering contract—aims for a ~50% CapEx reduction for European facilities by shipping Lego-style modules.
  • Positive Sentiment: Financial discipline delivered a 46% YoY reduction in cash operating expenses to $2.6 million in Q1, with cash used in operations of $3.1 million and ending liquidity of $12.3 million.
  • Negative Sentiment: Loop faces a ~$15 million funding gap for its India JV equity contribution (totaling $25 million), planning to fill it via government grants, engineering revenues, licensing fees and new capital.
AI Generated. May Contain Errors.
Earnings Conference Call
Loop Industries Q1 2026
00:00 / 00:00

There are 2 speakers on the call.

Operator

Good morning, ladies and gentlemen. Thank you for standing by. Welcome to Loop Industries first quarter fiscal twenty twenty six corporate update call. My name is Emily, and I'll be coordinating your call today. After the presentation, you'll have the opportunity to ask any questions, which you can do so by pressing star followed by the number one on your telephone keypad.

Operator

This conference is being recorded today, Wednesday, 07/16/2025. The earnings release accompanying this call was issued after the market closed yesterday, Tuesday, 07/15/2025. On our call today are Loop Industries chief executive officer, Daniel Solomita interim chief financial officer, Nick LaFonde and Kevin O'Dowd, head of investor relations. I would now like to turn the conference over to Kevin O'Dowd to read the disclaimer regarding forward looking statements.

Speaker 1

Thank you, operator. Before we begin, please note that today's discussion will include forward looking statements within the meaning of US security laws. These statements relate to our expectations, projections, beliefs, future plans and strategies, anticipated events and other performance matters. Forward looking statements involve known and unknown risks and uncertainties that may cause actual results to differ materially from those expressed or implied. For a complete discussion of these risks and uncertainties, please refer to the risk factors and forward looking statements sections in our most annual Form 10 k or our quarterly report in the 10 Q filed yesterday with the SEC and our earnings press release issued yesterday.

Speaker 1

These documents are available at www.sec.gov or directly from our Investor Relations team. With that, I'll now turn the call over to Daniel Salamida, Founder and Chief Executive Officer of Loop Industries. Thank you very much, Kevin. Good morning, everyone. We continue to make steady progress towards groundbreaking of Infinite Loop manufacturing facilities in both India and Europe.

Speaker 1

Both regions working with excellent local JV partners with whom we are fully aligned as we advance to the next stage of strategic development. Let's start with Internet of India. Offtake discussions are progressing well with leading global apparel brands and CPG brands. For the apparel company, we're are offering a textile to textile solution, meaning we recycle waste textiles and turn that into brand new polyester fiber, which they then incorporate into their clothing. Most of these apparel brands need a solution to be able to incorporate more sustainable materials into their clothing.

Speaker 1

Today, they're using mechanical recycling, which is basically coming from water bottles and turning that into fibers, but that's that's a way of the past. Bottles need to stay within the bottles, and the textile companies recognize that they need a solution for textile to textile recycling. And that's where Luke comes in. The ability for us to recycle textile waste, removing all coloring dyes, all other types of impurities, and providing them with virgin quality polyester fiber is a huge is a huge advantage for the the apparel brands. There's a plentiful of waste polyester fiber available in India for us to be processing at the facility due to India's textile industry.

Speaker 1

On the CPG side, the consumer packaging good companies today, European beverage brands are in need of high quality recycled PET. The quality of the mechanical recycled PET that they're using today is getting worse, and the quality is very low affecting their packaging. And so they really need to find a solution for being able to incorporate more recycled material, but getting high quality material. And this is a a a trend that we're gonna continue to see as more mechanical recycling comes on board, the quality of the ARPAT that they're producing is getting worse and worse. And eventually, because there's only certain amount of cycles that a bottle can go through until that bottle is no longer usable, few mechanical recycling.

Speaker 1

And that's where Loops technology steps in. Loops technology obviously provides virgin quality, top quality PET resin to the brands coming from waste materials. So no matter what the incoming feedstock quality is, we always produce the top quality output. So a lot of European beverage brands are looking to look to be able to provide them with that high quality PET made from a 100% recycled content. The advantage of India's low cost structure is that it allows us to provide the highest quality PET made from a 100% recycled content to our customers at very competitive prices while maintain while achieving attractive economic returns for loop and generating strong class cash flow to fund future capacity.

Speaker 1

So those are really the key elements for this is providing the customers with the highest quality PET based on a 100% recycled content. And today, because of India's low cost structure, we can provide them at very competitive pricing. The $176,000,000 CapEx was confirmed by Tata, the engineering firm who did the FEED study. That CapEx number includes a polymerization unit to recompline the d n t and d n e g into PET, land acquisition, and all financing costs through start up. If we remove all of those costs, the total install cost of the technology with of Looch's technology is 95 it's $95,000,000, which is by far the lowest cost of the industry.

Speaker 1

Site selection has been narrowed to two locations in Gujarat, and we'll be finalizing which land we'll be choosing very shortly. The economics for Loop on the project, in addition to the JV returns of which we own 50%, will be further enhanced by licensing fees. So Loop we'll see the 5% licensing fee for technology and customer sales and as well as engineering fees. We signed a $1,500,000 engineering contract with the Indian joint venture to provide engineering support for the next stage of engineering, the detailed engineering and construction. In France with Europe, Societe Generale is seeking to advance the timing of the project under their newly appointed CEO of the economy and his dedication to advancing the project.

Speaker 1

Right now, we are supporting them in the site selection, which is the immediate focus. Right now, the site selection is focusing mainly on Western Europe, and so our team is supporting them as we look through the different pieces of land to find the optimal piece of land. Once that piece of land is identified, then we'll start working on the engineering for the project and the modularization. So the engineering is gonna be done in a modular fashion fashion where the modules are going to be built in India. So we're bringing India's low cost manufacturing, low CapEx, and exporting that to other parts of the world.

Speaker 1

In this case, it's gonna be Europe. So we are working with a leading company in India for modularization with significant experience in the chemical industry. The modules for loose technology will be built in India and shipped to Europe or any we can ship them to any location in the world, and they're assembled like Lego blocks on-site. This will significantly decrease CapEx for these projects, for loops technology anywhere in the world. The initial estimate is that the CapEx would be a 50% reduction versus if we would be doing it as a stick build.

Speaker 1

So that's a significant savings. So, again, it perfectly positions Loop's technology to deliver highest quality PET resin or polyester fiber to the customers with extremely competitive prices. So it couldn't be more happy with the modularization progress that's going on right now. In addition to the shared project economics in Europe, we will generate additional revenues from providing the modular solutions from engineering services and two other milestone payments coming from that first European facility. With that, I'll turn it over to Nick LaFrom for some update on the financials.

Speaker 1

Thank you, Daniel. There are two key items I'd like to highlight from our Q1 fiscal twenty twenty six financial results filed last evening. First, we continued our disciplined approach to managing expenses and preserving cash. Cash operating expenses for the quarter were $2,600,000 representing a reduction of $2,200,000 or 46% compared to the same quarter last year. Cash used in operating activities for the quarter was $3,100,000 including working capital outflows of $800,000 These outflows reflect the timing of certain payments early in the fiscal year from which we will benefit later on.

Speaker 1

Second, we ended the quarter with available liquidity of $12,300,000 Our objective is to secure sufficient financing to fund Loop's equity contribution for India at our operating cash burn through to the start up of the Indian facility. Anticipated sources include government funding and engineering revenues in addition to new capital. I'll now return the call to Daniel for his closing remarks before we open the line for questions. Thank you, Nick. So in conclusion, we're in excellent position to move to the next stage of strategic development of the Infinite Loop manufacturing facilities.

Speaker 1

The first facility in India has by far the most attractive economics of any project we've considered, and we have a great JV partner. The modularization, it brings a really a differentiating factor where because of the lower cost CapEx now, you can see an acceleration of the amount of projects that can be built because you can offer really competitive prices and maintain, you high returns, which is key to all of these projects. We have a great partner and a good relationship with our European partners, so advancing together in lockstep. The long term vision is to drive significant shareholder value creation through continuing rolling out these manufacturing facilities. As we said, we have licensing revenue, engineering revenue, modularization revenue, and then obviously a share in the project economics.

Speaker 1

And we have very strong relationships with all of the different customers that are looking for high quality PET resin and polyester fiber coming from Loops technology. So I couldn't be more excited about the future of Loops. With that, I'll open up the line to questions. Thank

Operator

you. We will now begin the question and answer session. As a reminder, if you would like to ask a question today, please do so now by pressing star followed by the number one on your telephone keypad. If you change your mind or you feel like your question has already been answered, you can press star followed by two to withdraw yourself from the queue. Our first question today comes from the line of Jerry Sweeney with Roth Capital.

Operator

Please go ahead.

Speaker 1

Good morning, Daniel. Thanks for taking my call. Hey, Jerry. It's fine. I want to see if you could touch upon, you know, your offtake agreements, maybe go into a little bit more detail.

Speaker 1

Do you have an idea of maybe potential timing and what we should think about that? And then secondarily, does signing any of the CPG agreements need to coincide with any stages of the India project moving forward? So the customer contracts, you know, we've been advancing discussions with customers steadily over the past few months, especially since the CapEx number was confirmed. So we have a confirmed, you know, profitability range that we wanna maintain with it. So things are are going really well on the customer side.

Speaker 1

Signing off on contracts is taking, you know, sometimes a little bit longer as there's a lot of steps internally in today's world. You know, with higher inflation, people are are a little bit more not cautious, but I'd say there's more internal steps that have to be done to get contracts fully executed and fully signed, especially for contracts that we are negotiating, which is longer term contracts. So it's not usually, these CPG brands buy either spot price or one year contracts. We're asking for longer length contracts between three to five years in length. So, you know, those are those are certain things that internally they have to have acceptance from senior management for these type of things.

Speaker 1

The pricing, because we're really competitive in pricing, because of the low cost structure in India, pricing really is not an issue where we you know, the pricing is is is well aligned with the needs of the customer. So that's the big advantage that we have. And then there's a take or pay element to our contracts. So if the customer would not take the volume for any reason, they would be penalized to a certain amount. Could be 40% of the value of the contract, could be a 100% value of the contract.

Speaker 1

So that's another thing. We wanna make sure that these contracts are very bankable. So we are looking to sell out a certain portion of the facility prior to starting up the facility. You know, securing the debt financing for the facility, it's easier to have the the terms would be better on the debt financing when you have a certain percentage of the contracts secured. And so that's our that's our immediate goal.

Speaker 1

Yeah. And we have line of sight on that. So so we're very confident in being able to execute on that. Gotcha. Couple more maybe a little bit more detailed questions in the contract.

Speaker 1

Historically, previously, you looked at I don't know if cost plus was the right term to use, but with the previous contracts that you discussed, you would have your input cost plus, let's say, the conversion cost plus the markup. So you had some stability on the margins. Oh, well, the contract with a similar structure as that? So, actually, the one advantage that we're giving to customers, customers like predictability. Customers like to know that for three years, this is how much they're gonna pay and not have the, you know, the ups and downs of those cycles.

Speaker 1

Yep. You know, potential wars or oil disruption or whatever it can be that's gonna affect the prices. So because of the Indian low cost structure and the security on our supply, so, you know, those variations are important when your raw materials can fluctuate tremendously. And so that's where you would put in a cost plus structure or an index plus structure. Because in India, there's plentiful waste available at and we're locking because no one else can recycle the type of material that we're recycling, We can lock in fixed prices on our feedstock, then we can lock in fixed prices for the customers.

Speaker 1

So today, we're actually offering customers fixed price contracts, which is a huge benefit. So, you know, to offset some of the longer term or offset the liabilities they have to pay, we offer them a fixed price for for, let's say, three years or five years. So it's a big advantage to them that evens out their predict their predictability of their cost. So that's the way we're selling the the material in India. In Europe, you may go back to that cost plus because there could be more variations.

Speaker 1

But in India Yeah. Fixed price contract, and the customers really appreciate that. Got it. One more question. Just maybe, you know, next few steps.

Speaker 1

Obviously, CPG contracts or or apparel apparel, and that helps drive the financing aspect. So maybe next few steps, there would be, you know, contract financing, and then what would be some other areas that we should keep an eye on going forward? Well, we've the JV has hired KPNG to syndicate out the debt financing. So they've already prepared what they call as a detailed project report, and they're already presenting this to Indian banks and other banks. EBC in Canada is expert developed in bank of Canada is is interested in supporting because of Loops technology and bringing that worldwide.

Speaker 1

So we've already begun that debt financing work stream. And now as the customer contracts come in, you know, it just brings more credibility to the story and it proves out the economics that we've shown the banks. So that's well underway. Mhmm. The land selection, we have two pieces of land that we've zeroed in on in Gujarat, in the Dahesh region, which is where a plentiful amount of waste textile feedstock and waste bottle feedstock.

Speaker 1

And so now we're just looking at negotiating the final terms for either or of those two pieces, and we should have a conclusion of that very shortly. So that's another milestone. But, yeah, the biggest milestones are gonna be the customer contracts in place for the facility. So those are gonna be the big ones for us. Got it.

Speaker 1

Okay. Great. I'll jump back in line. Thank you very much. Like, I just maybe one more thing on the customer contract so that everybody is clear.

Speaker 1

The customer contract is between Loop and the CPG or the apparel company. So we make the sale, and then there's a back to back contract that goes to the joint venture. So the actual sale is between Loop and that company, and then Loop and the joint venture will have a back to back contract.

Operator

Thank you. Our next question comes from Verik Kutnick with Difty Capital Partners. Please go ahead. Your line is now open.

Speaker 1

Hey, Daniel. Thanks for the question. Wanted to get some direction on loose capital intensity. A public dissolution recycler recently said that their facility in Thailand will have a gross CapEx per pound of approximately a dollar 40 to a dollar 70. That's based off, I think, a 130,000 tons per year.

Speaker 1

Where does Loop fall from a gross, which means excluding financing and land and net CapEx per pound on the facility that you're building? So for loops technology only so if we exclude land acquisition, if we exclude financing costs, and we exclude the polymerization, which is, you know, putting the monitors back together, our cost per pound at a 100 so our facilities are a £154,000,000 per year capacity. We would be at 61¢ per pound. Wow. Okay.

Speaker 1

That's pretty helpful. So that's yes. The CapEx per pound would be 61¢ per pound produced. And as Right. Can I come on in that basis?

Speaker 1

Is that on that basis, just to be clear? Yeah. That's on the For that that's on basis. Exactly. That's excluding financing cost, excluding land cost, and excluding the polymerization cost.

Speaker 1

If you would add in the polymerization unit, then we would be at 75¢ per pound. But roof sole technology is 61¢ per pound. So if you're plugging into an existing facility that has polymerization, we're at 61¢ per pound. And that's at 70 you know, that's at the current capacity. The beauty of Loop's technology is because there's really no proprietary equipment in the technology.

Speaker 1

It's basically, you know, reactors, filters, and distillation columns. The technology lends itself very well to scale. So future facilities like our India 2 facility, we're looking at, you know, 50% increase in capacity. So that 61¢ would even come down further from there as we scale to bigger facilities. But, yeah, 61¢ per pound is today's number.

Speaker 1

That's it. Appreciate the color. Thanks, Daniel. Come back in the queue. Thank you, Barry.

Operator

Thank you. Our next question comes from Jonathan Norwood with Friends and Family of BMO. Please go ahead, Jonathan. Jonathan, your line is open. Please proceed with your question.

Speaker 1

Sorry. I was just muted there. Thanks for thanks for allowing me to have some questions here. Just a a a couple follow ups here on the question that Jerry asked about the offtake agreement. So, I mean, these are obviously long lead, agreements because you're probably, say, three years away from being able to I mean, maybe you can correct me on that.

Speaker 1

But by the time you get this, the the facility up and running and producing products, you're probably looking at about three years out. So how do you like, what sort of out, I guess, do you have or does the CPG company have or the apparel company have in terms of Luke not meeting milestones from a construction perspective? Or or or what sort of outs do you have in the event that, you know, the environment changes such that selling to this particular company would not be economic? So, yeah, a couple of couple of different, you know, points there to discuss. So the facility would be up at the end of twenty seven.

Speaker 1

It's eight eighteen months construction time plus, let's say, six months of start ups. We're twenty four months away from, let's say, this fall. So the plan is to have the facility up by the end of twenty twenty seven. Customer contracts, there's a take or pay element. So if we're producing the material, shipping it to them, if they do not wanna accept the material, they have to pay us a penalty on the material, like I said, ranging between 40% of the contract up to a 100% of the contract.

Speaker 1

It's a negotiation difference with every customer. If Loop is unable to deliver the material to the customer, there's no financial penalty to lose. Okay. So if you guys let's just say for whatever reason you were unable to, like, have this thing up and running in eighteen months. Let's just let's just say it's the end of twenty eight instead of the end of twenty seven.

Speaker 1

Could these guys could they back out of the green like, is there anything that's tied to your ability to get the plan up and running by the end of twenty twenty seven? No. There's nothing tied to it. Okay. Alright.

Speaker 1

Just making sure on that. Because, I mean, we've seen in the past, and and I know that, you know, we we were essentially I think, initially, it was sort of, like, bottle to bottle. And we, you know, we've seen, like, Coke and Pepsi sign up and then subsequently drop off. And I'm just wondering, like, I, you know, just just wanna be mindful of of that and and how, you know, a delay in the construction of the project could potentially because it's been a long time to get this thing up and running, and just wanna make sure that these guys you know, they don't have the ability to pull the plug sort of halfway through construction or anything of that nature. But Sure.

Speaker 1

That's fine. So Just let me clarify that that that think, Jonathan, know, the past when you had a contract with Coke and Pepsi, it was for a Coke Coke and Pepsi didn't pull the contract. It is that Loop that it wasn't able to deliver the facility, which we're talking about was 2018, which was a facility in 2018 that we were looking and doing in Spartanburg, South Carolina. So no contract was ever pulled. It was that Loops was unable to I I forget that.

Speaker 1

That we're talking about seven years ago. Right? So it's a completely different project and completely different economics. So and, you know, a very different customer base. So, yeah, I understand your concern, but, yeah, the the the facts of the matter was that we did not build the plant in Spartanburg, and that's why the contract fell off.

Speaker 1

If you have a certain contract for a person's facility and it doesn't get built, you know, if the facility is built and operating, then the customers are locked into the to buying the volumes. Okay. Now that makes sense. And so on the, on the equity contribution that's required, by Loop for the the India facility. Can you remind us of how much that is and what the timeline for having to inject that that amount is?

Speaker 1

So the total amount would be $25,000,000. Part of it will be paid for with polymerization equipment that we had bought for a previous project. So we'll be able to reuse that equipment. We also have a certain portion of that committed by a government entity here in Quebec, and the timing for that is probably sometime in the fall once we have the land selected. So, yeah, sometime towards the fall time frame.

Speaker 1

So like we said, by the end of the year, breaking ground. So at the time of breaking ground, that's when we would be needing all of the capital in place for the project. So so what's the funding gap then between, I guess, the amount of cash that you you will have on hand at that time, the amount of capital that the the government entity will will be putting up, and then the the the amount that you have to effectively put in? What's what's that that funding gap? And how do you anticipate coming up with that capital?

Speaker 1

The funding gap is for that for that facility is about $15,000,000. So we have several different opportunities right now that we're evaluating for the $15,000,000. The one thing I'm really excited about is the acceleration of the SocGen project because we'll be touching engineering and modularization revenue earlier, and that will definitely help with the, you know, cash flow going forward for for the loop's cash position. So the amount needed right now is $15,000,000. Okay.

Speaker 1

Okay. And just on on licensing, Dan, can can you give us an update on what, I guess, the pipeline looks like for potential companies to to license your your IP? Like, how active is that pipeline? Or, you know, are there any sort of hopefuls or people that are are interested in that? Yeah.

Speaker 1

I think with the you know, once we've confirmed the CapEx number in India and the modularization work that we've done, it really allows projects where before you were looking at these very capital intensive projects of, you know, somewhere north of $500,000,000 for a plant. Now that we're able to cut that number in half, let's say, for, you know, the Western World or North America or other higher cost manufacturing companies, I think that opens the door to a lot more potential projects. SocGen is very interested in building multiple of these facilities, so we wanna start with one in Europe. But, you know, they have a plan to roll out several of these facilities through their private equity arm. They have a new CEO they have a CEO that's been hired just for this.

Speaker 1

So he's working diligently with my team on finding the the optimal location and then bringing in the facility, bringing in the modules. So that modularization, I can't stress how much that modularization is gonna help rapidly expand future facilities. So there's other potential opportunities in Asia. There's potential opportunity in North America. So, you know, we we're looking at a whole bunch of different opportunities right now.

Speaker 1

India is gonna be, you know, still the low lowest cost facility we'll ever build. It's gonna be India and the economics are are are tremendous for us. And the customer appetite for Indian material is strong, you know, shipping it to Europe or using it to other you know, the textile supply chain is all done in either China, South Korea, Vietnam, or or or Taiwan. And so having a facility in India supplying those those countries is really important for us. So we are definitely planning.

Speaker 1

We're buying enough land to have a second facility on-site in India. So the plan there is after the first facility, we have a year of operation to expand to the second facility, which would be a 100,000 tons, which is about 50% capacity more than the current facility. So that's gonna be another really exciting opportunity having that low cost structure in India and continue building off of that. Yeah. Yeah.

Speaker 1

Well, no question. I mean, you know, on paper anyway, India seems to be the optimal place to to locate one of these plants. So I guess just one last question on the debt piece, that your Indian partner has to come up with. It sounds like, KPMG has been engaged to to put together a syndicate. That's I mean, that an Indian based thing?

Speaker 1

Because, typically, in North America, like, you wouldn't expect to see an accounting firm putting together, you know, a syndicate. You'd have a bank that would be be doing that. So what what's the, yeah, I'm not I'm not used to hearing KPMG, like, organizing a syndicate. Is that is, like, a pretty standard thing in in Asia? Maybe Kevin or I can Our partner at Esther has built they have three operating three PET operating facilities.

Speaker 1

The latest that they've built was in 2021, and this is the same this KPMG was the person they used for that that syndication as well. So Okay. You know, we're following their lead as they have some experience in that. We're following their lead, especially with the Indian banks. Okay.

Speaker 1

Okay. Okay. Thanks for thanks for letting me ask questions, guys. Thank you.

Operator

Thank you. Our next question comes from Marvin Wolf with Paradigm Capital. Marvin, please go ahead.

Speaker 1

Yeah. Can you hear me alright, guys? Yeah. I can hear you fine, Marvin. Yeah.

Speaker 1

Okay. Very good. Yes. And thanks for taking the questions this morning. I was wondering, could you give us more color on things surrounding the two sites you're looking at?

Speaker 1

Things like, you know, lead time on permits, are these fully greenfield sites, You know, all that kind of stuff. Because, you know, here in Canada, you could choose a site today and not be allowed to break ground for around maybe a couple years between by the time you got through all the local regulations So a little more color on that would be helpful if you could. Yeah. So the permitting comes with the with the purchase of the facility.

Speaker 1

So they're they're in industrial zones already zoned for this type of an activity. So we're we'll be with other chemical companies in the park. And so when you acquire the land through this process, we acquire the light the permitting as well. So once the land is acquired, we're ready to start construction. Very good.

Speaker 1

And that and so that includes everything. That includes, like, utilities and and and and and and everything. Well, utilities depends. You know, like, the utilities in our process is, you know, steam generation electricity. So those type of things you'll have to bring in the substation for the electricity connected to the electrical, you know, outlets in the area.

Speaker 1

So some of this will have some industrial parts have some utilities, some don't. That's a big, you know, part in in in deciding which location to use. A lot of that has to do with what utilities are available. In India, the utilities are mainly just, you know, roads, and there's nothing that would be for our process specifically. So all of the utilities at these facilities in in India, Loop would be providing all of the utilities.

Speaker 1

That CapEx number has all the utilities costed into that. In Europe, it's a little bit different. You can find industrial parks or industrial areas that have certain utilities that will have a common steam generation or they'll have a common wastewater treatment plant. That's not the case in India. Okay.

Speaker 1

And how many megawatts of power do you need to operate the stove? Less than five. Okay. And it and is that is that, like, a standard number you can easily get from the hydro or electricity provider? Yeah.

Speaker 1

Our technology is, you know, the so the main source of energy used for our process is steam. So the steam is used to heat and cool reactors, distillation columns. Our technology is low energy, right, because we have a very low operating temperature in the our reactors below 85 degrees Celsius. So we don't use a lot of power consumption. And the number one energy source is going to be for the seed generation is going to be rice husk.

Speaker 1

So in India, it's a biomass, so very good for the environment. It's not coming from a full plant or not coming from other higher polluting sources. It's actually the peel of the rice that's used or pelletized, and they're they're used to generate the steam. So it's gonna be a 100% biomass coming into the facility. Okay.

Speaker 1

That sounds great. What about our long lead equipment? Is have you ordered any yet, or is there any that you gotta order soon here? Well, the longest lead is no. Actually, there's no real long lead equipment in for our our technology because, basically, all of our technology is all you know, it's a chemical plant.

Speaker 1

So it's reactors, stainless steel piping, heat exchangers, pumps, distillation columns, which are all fabricated within an eight month lead time. So there's no real true long, long lead time equipment. The longest lead time equipment would be the reactors for the polymerization, but we already have those in stock for a that we bought for a few for a past project. And so we already have those ready, and they're already they're already produced. So there's really no lead long lead time equipment that we need to be mindful of to meet our deadline on startup of the facility at the end of twenty seventh.

Speaker 1

On the polymer polymerization unit you have sitting around somewhere, what's the dollar value that's being attributed to that for your contribution towards the 25,000,000 in equity? It's gonna be approximately $5,000,000. Okay. Listen. Thanks very much for the color.

Speaker 1

Appreciate it. And waiting to see an announcement shortly on the site selection because I think that'll really get this ball rolling. Yeah. Site selection and customers, I would say, are the are the big announcements coming. You know, customers are very, very important to have those, you know, top quality CPG brands or apparel brands.

Speaker 1

So customers is gonna be key for this. Definitely. And they will let you use their name in a press release? We've got, you know, in the past, we've signed contracts with CPG brands, and we've always announced them. So I anticipate the same.

Speaker 1

And the same with the athletic company? Yeah. Yeah. Good. Because that helps a lot too.

Speaker 1

Right? Sure. Thanks very much, Daniel. Thank you.

Operator

Thank you. At this time, we have no further questions until I turn the call back to the management team for any closing comments.

Speaker 1

There's no further questions. Thank you all very much for participating, and looking forward to giving the market further updates as soon as we're available. Thank you very much.

Operator

Thank you everyone for joining us today. This concludes our call, and you may now disconnect your lines.

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