Funding Request - Eco Holdings of Jamaica is currently seeking a 940K USD capital investment to complete its fundraising for the construction of Phase I - An Environmentally Green Biomass Carbonization and Organic Fertilizer Plant in St Catherine, Jamaica.
Project Scope - The project currently has two phases.
Phase I is a carbonization plant with an annual production capacity of 11,000 tons of activated charcoal and organic fertilizer.
Phase II will expand the facility to include the production of 7,600 annual tons of bamboo fibre tissue paper with an additional 8,000 tons of organic fertilizer pellets from the bamboo pulping waste.
Target Markets – Jamaica, Caricom, US, Canada, and the UK.
Carbon and Organic Fertilizer Market Potential – The global activated carbon market is expected to reach 5.1 million kilotons by 2022. The market is estimated to be USD 5.7 B in 2021 and to reach USD 8.9 B by 2026, at a CAGR of 9.3%. The activated charcoal produced from biomass is replacing coal as a major additive to over 55 different product categories ranging from pharmaceuticals, and water purification to cosmetics. Bamboo charcoal itself is odour-free and has the power to absorb both odours and moisture. As a result, it's also good for managing humidity in the air and preventing mould around the house. It is super absorbent and can consume pollutants, toxins, and allergens that cause odours.
Activated charcoal has also become a major component of organic farming as a soil enhancement. The Global Organic Food market is growing at 3.2% annually and is projected to reach $230 B by 2026. The North American organic fertilizer market was valued at USD 1.1 B in 2020, and it is projected to reach a value of USD 2.5 B by 2026. The EU Organic Fertilizer market is growing at a CAGR of 12.09% and is projected to reach USD 3.6B by 2026. The Jamaica Government has prioritized its agricultural sector’s priority shifting away from chemical fertilizer to the production of organic crops. This is an opportunity for export and growth of Jamaica’s agricultural sector. Jamaica currently imports 9,700 tons of organic fertilizer in addition to its small local production of animal manure. Currently, there are no organic pesticides or herbicides in the Caribbean market.
Tissue Paper Market - The Tissue & Hygiene Paper market reached USD 42.3B in 2021 and is expected to grow annually at 4.48% CAGR to 2026. The market's largest segment is Toilet Paper at USD 15.2 B. Developed countries consume an average of 24 kg of paper per capita and emerging countries at 18 kg per capita. Bamboo accounts for 6% of the tissue and hygiene paper market and is exported globally from Asia. China has been making paper from bamboo for over 1,500 years and currently produces over 1.1M tons per year using traditional pulping processes.
Why Jamaica? – Jamaica is a democratic Commonwealth Nation, English speaking, and operates in USD and JAD currency. Jamaican container ports provide easy access to US, Canada, and UK/EU markets. Jamaica has an abundance of sustainable raw materials like bamboo, coconut, rice, and coffee processing waste. Segments of Its population have a high level of education. Labour rates are low and comparable to Asia and Central America. The strong Government support for our project comes from our focus on agriculture, the environment, and providing finished products for the Jamaican economy as well as an earner of foreign exchange dollars. As a new business investment, the government will provide a 5-year corporate tax waiver and has provided Eco Holdings with 11 acres of industrial land at a nominal fee of USD 78 per acre/yr. Jamaica has free trade agreements with the US, Canada, UK, and other Caribbean Nations.
Environment Stewardship and Job Creation – Our Corporate vision is 1) to provide Environmental Stewardship by processing waste and sustainable materials into valued consumable products with the target of becoming a carbon-neutral facility, and 2) to demonstrate social responsibility by creating over 180 jobs with an additional 300 secondary jobs in managing and harvesting our bamboo requirements. We plan to implement a product packaging from home program for single parents with children. We have estimated that an additional 20 employees will be required.
Raw Materials – Agreements have been reached with the Bamboo Industry Association of Jamaica (BIAJ) for long term sourcing up to 30,000 tons of it available 250,000 annual tons of green bamboo for both phases of the project. Jamaica processing plants will provide their coffee, coconut, rice, and other agriculture processing waste for our cost of transportation.
Energy Consumption- The production of activated carbon and organic fertilizers uses syngas generated from the combustion of feedstock at 300 -450c within an oxygen-free chamber. The heat from the syngas is recycled into driers to reduce the moisture levels of the raw material. Machinery and vehicles are powered by electrical. In Phase II, the power generation shifts from the Jamaica electric grid to on-site self-generation. The exhaust from the natural gas turbines is disbursed through algae ponds which are harvested for organic fertilizer production.
Zero Discharge of Waste or Treated Water – The design of the Carbonization plant and the Bamboo Fibre Tissue processing facility operate on closed-loop recovery systems. This provides for the recycling of water, heat, and chemicals with zero discharge into the environment. Waste from the production o tissue paper is processed into organic fertilizer pellets. Tissue bleaching uses a combination of Oxygen and Hydrogen Peroxide. H2O2 when treated revers to oxygen and water. The technology in both phases is currently in large scale production or tested in a large scale production environment for over a year.
Competitive Business Model – Our business model uses sustainable low-cost materials or waste to create high value-added products for both commercial and residential consumption. Our operation will implement a consolidated supply chain by combining the processing and packing into one process. This contributes to us being a low-cost producer and having a strong competitive advantage over Chinese imports with their layered supply chains and high transportation costs. We bypass the packaging companies and market our private brand “Green Island” through retail distributors. Our marketing strategy uses direct sales to farmers and retailers in Jamaica. Our marketing focus on North American and UK retail marketing is on small to midsize garden stores and the 2,000 West Indies retail stores in Canada, the US, the UK and across the Caribbean nations
Proposed Corporate Structure – Phase I operates as Eco Holding, Phase II operates as Eco Pulp & Paper Ltd. (EPP). EPP is a joint venture company between Eco Holdings 51% and Shandong Huixiang Patented Papermaking Machinery Ltd. of China up to 49%. Our Chinese partner has been designing machinery for over 25 years and managing pulp and paper facilities for over 15 years. They have agreed to acquire up to 49% minority interest and provide the outsourcing management for the installation, commissioning, and operations for up to 3 years.
Profitability – Extensive analysis has been conducted into competitive product pricing and margins across the extended supply chain. Based on our current low manufacturing cost and at maximum volume pricing, our current average margins per product category are projected to range from 53% to 95%. The key to such margins is the low cost of raw material, labour, self-packaging, and self-branding of finished products.
Pre-Sales - We have Letters Of Intent totalling over US$ 21 million from various entities for 200% of our annual production of pulp and/or bulk paper, and 30% of our fertilizer/charcoal products, and are seeking additional commitments for 100% purchase of all finished items before breaking ground.
Capital Budget – The project requires USD 940,000 for common share equity or a combination of common shares and convertible debentures. Capital expenditures include all production and support machinery, a 2,000 square meter steel workshop and office facility, transportation, project management, installation, testing, and commissioning of the plant.
Financial Plan Summary | Year 1 | Year 2 | Year 3 | Year 4 | Year 5
Total Revenue | $6,178,900 | $6,635,100 | $26,521,000 | $34,312,500 | $34,547,200
Net Income | $3,972,297 | $4,240,162 | $14,062,376 | $19,489,062 | $19,666,565
% Of Revenue | 64% | 64% | 53% | 57% | 57%
Total Liabilities | $296,328 | $ 3,326,432 | $ 3,169,625 | $3,071,855 | $ 2,938,125
Liabilities & Equity | $5,733,625 | $20,113,891 | $34,019,460 | $53,410,752 | $72,943,586
Ending Cash | $3,449,200 | $5,923,836 | $13,745,332 | $33,747,783 | $53,813,280
| Year 1 | Year 2 Year 3
| Phase 1 | Phase 2 Total
Capital Expenditure | 1,465,000 | 12,839,000 | 4,370,000 | 18,674,000
Less Project Development | 325,000 | 265,000 | - | 590,000
Less Mr. Li Investment @ 40% equity | | 6,845,000 | - | 6,845,000
Less EXIM Bank Line of Credit | 200,000 | 2,500,000 | - | 2,700,000
Less self-financed | - | 3,229,000 | 4,370,000 | 7,599,000
Equity Cash Requirement | 940,000 | - | - | 940,000
Equity % | 64% | 0% | 23% | 5%
Fixed Asset Addition | $ 1,265,000 | $ 10,339,200 | $ 4,370,000 | $ 15,974,200
Current Revenue Coverage | Phase I | Phase 2 | REVENUE COVERAGE | %
| Y1 | Y3 | |
Agriculture Sector | 1,200,000 | | 1,000,000 | 83%
Retail Products | 4,900,000 | | 500,000 | 10%
Tissue Products | | 19,300,000 | 20,000,00 | 103%
Implementation Plan - Phase I is currently scheduled to be operational 6 months after ordering of machinery. Phase II – subject to board approval – will be paid from retained earnings of Phase I and is targeted to go live in Q1 of the 3rd year.
Management Experience – Our management team, partners, and consultants for this project have extensive experience as senior executives and management consultants in both public and private companies plus new business ventures.
Trevor Blair – Founder, BSc. (Physics/Applied Physics), MBA, MSc. (Computer Science )
Former Consultant to Haliburton and Standard Oil
Founder of Interface Consultants (currently called IPS Consulting)
Founder Affordable Structures Jamaica (Therml-Impac Panel Building System)
Mark Nash -Founder, BA Commerce and Economics
IBM Brand Product & Campaign Manager, Personal Computer Family, Canada, and North Caribbean
Manager, Acquisitions & Mergers, IBM Finance
IBM/ISM Director, Data Centre, and Professional Services Outsourcing
Unisys Canada, VP Corporate Operations, GM Iconix Division - Americas, Asia, and Africa
Vice President, Business Development CEC Mining Ltd.
Preben Ormen – BA, MBA, Eco Holdings Financial Officer
Large Project Management at KPMG/BearingPoint
Natural Resource Project Manager at PwC
Over 15 years of International Business Consulting in the Natural Resource Sector
Experienced in Aqua Farming
Award-winning author
Fengning Li – BSc. Eng. Pulp & Paper
Owner, Shandong Huixiang Paper Making Machinery Ltd
Owns and operates pulping facilities
Over 25-year experience in machinery design
150 registered machinery design patents
Lecturer at the PRC Pulp & Paper Research Institute, University of Qilu
Currently constructing a 50,000-ton recycled paper plant in Hong Kong
Mario Salan – BSc. Eng. MBA Environmental and Land Management
Consultant to Eco Holding on Environmental land Management
General Manager, LAKunth Ltd. Guatemala City, Guatemala
Grows over 5 Species of Bamboo for pulping, carbonization, and home construction
Manufacturing and Construction of Steel and Bamboo Homes in Jamaica and Central America
Project leader of LAKunth Phase I – 75 Affordable Home Project in Jamaica
Lisa Myers-Morgan – Plant Medicine BSc. PhD, University of Florida
Consultant to Eco Holdings on Organic Fertilizer formulas and Soil enhancements
Certified for Agronomy, Agricultural Policy, Latin America, and the Caribbean
Research Director, Jamaica Ministry of Industry, Commerce, and Agriculture
National Agriculture Expert – Centre for Agricultural Bioscience
Senior Research Director – Plant Protection
Alice Yang – Supplier and Construction Consultant to Eco Holdings Workshops
General Manager, Qingdao Xinguangzheng Steel Structure Co., Ltd.
Specialize in Modular Steel Building, Stadia, and Large Workshops
Largest Steel Structure Exporter in China with installations in over 70 countries
Summary – Under the leadership of Trevor Blair, this project has been in development for over three years and has been an international collaboration of experienced companies and individuals from Norway, Canada, China, Jamaica, and Guatemala. Our team has conducted extensive due diligence into the market potentials, project implementation, risk assessments, product development, marketing, and financial modelling of this project. We are requesting an equity partner that sees our project as a step forward as a viable solution to our environmental challenges and the potential for a good return to stakeholders. We strongly believe we can demonstrate a green project can deliver a robust margin from waste and renewable materials and create valued consumable products for both commercial and residential markets now and in the future.