Green Tech Co. Gathers Capital for Ecuador Bioleaching Plant

BacTech Environmental Corp. announced it had closed the first tranche of private placement funding as it works toward closing on millions in green bonds to build its long-anticipated bioleaching plant in Ecuador.

The subscription units totaled CA$614,040, the company said. Two insiders participated in the financing for a total of CA$32,000.

The money will allow BacTech to meet its business obligations and basic working capital needs as it works toward closing on $US20 million in green bonds.

The placement was "progressing nicely," BacTech President and Chief Executive Officer Ross Orr wrote in a recent "Sunday Morning Coffee" email to shareholders and supporters.

"Everyone, I mean everyone, was not in a hurry to do anything until they were confident all the major permits are in place," Orr wrote. "And they are."

Each unit of the private placement, priced at CA$0.08, comprises one common share and one-half of a common share purchase warrant in the capital of the company.

Each whole warrant will entitle the holder to acquire one additional common share in the capital of the company at a price of 12 cents for a period of two years from the date the units are issued. If during the exercise period of the warrants the company's shares trade at 20

cents per share or higher for a period of 10 consecutive trading days on the Canadian Securities Exchange, the company may provide notice in writing to the holders of the warrants that the expiry date will be accelerated 30 days from the date of providing such notice.

The Catalyst: Environmental Permit Milestone

Last month, the company finally obtained an important environmental license from the government of Ecuador, a major milestone for the company in the South American country.

Chris Temple of The National Investor, a supporter and shareholder of the company, said the license was "the last such hurdle for the company; BacTech will now proceed to tie up project financing and move to construction." 

The company is "a poster child for what is legitimately a green cause," Temple has said.

Technical Analyst Clive Maund of CliveMaund.com also rated BacTech an Immediate Buy in March.

The company has launched a new sustainable framework for issuing US$20 million in Green Bonds to pay for the plant.

"We've discovered a gem in Ecuador," Orr said. "While governments may change, environmental issues persist until addressed. I firmly believe that Ecuador is just the first in a series of successes that will follow once we demonstrate the capabilities of our technology."

The company's bioleaching process uses naturally occurring bacteria, harmless to humans and the environment, to extract precious and base metals from ores, concentrates, and tailings. Its motto is "Our bugs eat rocks."

The rocks are like bricks in a wall, with sulfur as the mortar. The bacteria eat the sulfur, causing the wall to come crashing down.

For the feed going into the plant, there are 90 small mines in the area that produce significant amounts of arsenic with gold. The plant would process about 30,900 ounces gold (Au) per year. There is potential for expansion; the total availability of materials in the area is an estimated 250 tonnes per day.

However, Orr said the company would likely have to revisit an original feasibility study for the plant.

"The good news is the original pricing was done at the peak of the supply chain crisis, so we are expecting sharp reductions in price for stainless steel which is the most expensive part of the plant," he wrote to supporters in a "Sunday Morning Coffee" note.

Ownership and Share Structure

Nearly half of the company, 49%, is held by insiders, management, and strategic shareholders, the biggest of which is Option Three Advisory Services Ltd., which owns 8.48%, or 15.57 million shares, according to Reuters. That also includes CEO Orr, who owns 3.57% or 6.54 million shares, and Board Director Timothy Lewin, who owns 0.54% or 0.98 million shares.

The rest is retail.

The company has 185.36 million shares outstanding, including 159.12 million free floating. Its market cap is CA$15.76 million, and it trades in a 52-week range of CA$0.10 and CA$0.055.

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