Post by
RealVal on Dec 31, 2023 9:58pm
A few thoughts on Replenish going forward
For what it's worth:
While it's been a bit frustrating for some of us who have been waiting (reasonably) patiently for the 7 Mil ERA grant and overall financing for the debolt facility to come through, I do think it's worth keeping a couple things in mind while we do so:
- Insiders own between 25% -30% of current outstanding share count (my understanding).
- their average valuation in receiving those shares was .25 cents/share. - ie: no one is more motivated to get share price back to and above that then them.
- Their whole rationale for injecting Replenish assets into Earthrenew was to create a vehicle so they can access and attract equity capital to allow them to scale Replenish up to a minimum 300,000 tonnes per year capacity (Beiseker, Debolt and Bethune).
- Beiseker AND Debolt make Replenish a "viable commercial entity", Bethune (or similar size project in the U.S.) will make it a "valuable commercial entity".
- They clearly believe they are going to nail down this 7 Mil in non-dilutive equity. While taking longer than I am sure they hoped/expected, they are willing to hold off on doing another external raise because they benefit as much or even more than we do when it comes through (THEY DO NOT GET DILUTED).
- I strongly believe if they did not feel this equity grant and with it the overall financing for Debolt was still on track they would have already gone out and done an equity raise in this 7 Million range to facilitate the initiation of construction at Debolt.
- Building Debolt is an ESSENTIAL next step for the company on the path to scaling the operation to a commercially viable entity. - In the interim, they are running the company in a fiscally prudent manner, they are building sales best they can and advancing other sales channel possibilities (turf market and licensing/royalty).
Hopefully the 7 Mil. Contribution Agreement with ERA gets papered and announced in the near future and "not too long" after we can get some visibility over how they intend to advance the Bethune project (self fund equity portion to combine with conventional financing, Joint Venture with a corporate or financial partner or licensing to a completely separate entity).
Those two events will give us and the market a clear view on where this company can get to in the next 2-3 years and what its value will therefore be.
Wishing everyone a rewarding 2024!