CEO explains P2O benefits

"Brig" e-mailed John and asked him what kind of scrap works in the P2O machine....here was his reply:

Initially in April 2009, we believe we would be limited to processing certain kinds of plastics (somewhat sorted). That has changed significantly since building several continuous processors (small and big).

At this time we can process dirty plastics without any difficulty. We do not need sorted clean plastic. The lab results show little difference between running PP, PE, HDPE, LDPE, or pvc for that matter (PVC is preprocessed before entering the reactor) sorted/combined/cleaned or for that matter a composite, when run in our processor and I have that data to back it up. It's the classic what you put in you get out. If I process 1 lbs of plastic and half of it contains rocks then I am really processing 1/2 lbs of plastic (converted to fuel, propane and possible some residue from colour additives) and the 1/2 lbs of rocks stays in the reactor. If we process a unique plastic that is made up of 25% metal then the metal stays in the reactor.

Do we must have to pay for plastic? No we don't. I have a contract for mixed plastics, free, for ten years and that is no big deal because I don't have any difficulty acquiring plastic. We are happy to receive dirty plastic (ie: mixed, composites, etc..) . What you have to remember is we get out what we put in.. so if a unique plastic contains 5% heavy metals then the heavy metals stay in the reactor and we get 95% of the remainder converted to fuel, propane, and then up to 2% additional residue.

You haven't brought the argument of well "JBI will create a commodity out of dirty plastic" . No we won't -- we only would if we let JV's bid for feedstock. If we don't get it for free then I don't want it and they can continue to pay trucking and dump tipping fees. I tell any potential supplier of plastic that we are not paying anything for it in advance to avoid senseless discussions of pricing junk plastic. Our FL group has run into some of that but it doesn't last long... Bottom line is I will then save their competitors money by processing their plastic and reducing their costs. A supplier came to our site here and wanted to get paid a couple cents a pound and we sent them away. They came back a week later willing to give us the plastic for free when they realized we are not going to let dirty mixed plastics become a commodity.

80% of all plastic goes to landfill and that is the plastic we are acquiring -- NO ONE buys it now and it is expensive to discard. I don't want the other 0-20% of high quality, highly sorted, super clean plastic that some (few) pay for. The Chinese control that market and it is very cyclical.