Turn Biomass Waste into Profit… not CO₂!

The Opportunity - There are vast amounts of readily available and cheap waste biomass in the Western United States waiting either to be burned, making planet-warming carbon dioxide (CO2), or turned into valuable carbon-based products.  Northwest BioSolutions LLC (NWB) has the plan to do it.  NWB plans to acquire sites with ready access to large amounts of biomass and proprietary technology that will give it significant advantages over other companies.  To implement its plans, NWB is seeking $80 million in funding.  After five years, projected revenue is nearly $200 million per year and IRR based on EBITDA is 40%.

The Products - Carbon, the basis for all life on Earth, has been used by humans for ages in various forms.  NWB is particularly interested in profiting from two carbon solids made porous by controlled heat treatment: activated carbon and biochar.

Activated carbon (AC) has a large number of uses that take advantage of its high porosity (just 5 grams of AC (about a teaspoonful) can have the surface area of a football field or more than 57,000 square feet!).  These pores can beneficially absorb many substances.  Uses include removing pollutants from air and water, decolorizing and purifying alcoholic beverages and food, removing mercury from coal combustion emissions, storing hydrogen and natural gas at safer pressures, extracting gold during gold mining operations, absorbing fugitive fuel emissions in vehicles and as a catalyst support.  AC is made by heat treating biochar or other carbon-rich substances.  The global AC market is about 1.5 million tons per year and worth approximately $3.5 billion annually.

Biochar has been used for centuries in Brazil and Japan as a soil improver/amendment.  Biochar is made by the controlled heating of biomass in the absence of air.  It is simpler to make and has less porosity than AC.  Its porosity is beneficial to help the growth of “good” soil microorganisms, retain water in the amended soil and retain water-soluble fertilizers to help control fertilizer runoff.  This helps raise crop yields by about 10% (especially in acidic soils) and reduce water usage, both important benefits with an increasing population and dwindling fresh water supplies.  Adding biochar to soil results in carbon sequestration as opposed to CO₂ emissions from unused biomass left to decay or burn.  NWB’s research shows a market poised for take-off with production currently fragmented, supply inadequate and inconsistent quality.  NWB will be the launch vehicle.

The Business - NWB proposes to acquire strategically located sites in the Western United States and a technology company.  The sites have an ample and inexpensive supply of agricultural biomass waste to convert into AC and biochar.  The technology company has proprietary technology for converting biomass to biochar.  This technology has been successfully demonstrated at the pilot plant scale.  The technology can use wet biomass and gives control over the properties of the resulting biochar and the AC derived from that biochar, allowing product tailoring for successful penetration of the more sophisticated and higher margin AC market.  The technology also works with other forms of biomass such as food waste, municipal solid waste and sewage sludge.  NWB intends to license the technology to profit from alleviating waste disposal problems around the world.

NWB will place an emphasis on the quality of its biochar, which will differentiate it from imports and smaller suppliers with products of questionable and inconsistent quality.

Management – NWB has assembled a management team with the experience and skills to make this project a success.  NWB’s Founder has decades of experience and connections in the Western US forestry business; its CEO has over 20 years of experience leading and growing a specialty chemical company; its COO has decades of experience harvesting timber and manufacturing wood products and its CFO has many years of experience in agricultural businesses.

Intellectual Property - The technology company NWB which will acquire has one US and one Canadian patent for its technology.  Other patents are pending and provisional applications have been prepared for submission after funding.  The company also has significant proprietary knowledge that will be maintained as trade secrets.  The technology acquisition will give NWB research and development capabilities to develop other lines of higher margin carbon-based products.

Please contact us if you would like to learn more about this great opportunity.

April 19, 2017