Origin Materials: November Wrap-Up
It's been a while since my last post on Origin Materials, the world's leading carbon-negative materials company. The chemical industry can be pretty complex and hard to understand. If you're not familiar with the company or what it does, their own description is pretty clear and concise:
Origin’s mission is to enable the world’s transition to sustainable materials. For over a decade, Origin has developed a platform for turning the carbon found in inexpensive, plentiful, non-food biomass such as sustainable wood residues into useful materials while capturing carbon in the process. Origin’s patented technology platform can help revolutionize the production of a wide range of end products, including clothing, textiles, plastics, packaging, car parts, tires, carpeting, toys, and more with a ~$1 trillion addressable market. In addition, Origin’s technology platform is expected to provide stable pricing largely decoupled from the petroleum supply chain, which is exposed to more volatility than supply chains based on sustainable wood residues.
The company is currently completing construction of their first commercial scale plant in Sarnia, Ontario. Origin 1, or O1, is expected to be operational in 2023. Their second, world scale plant is planned to be operational in 2025 and will be in Geismar, Louisiana.
Construction Update
On November 3, the company released its Q3 2022 earnings report. Along with the usual financials and updated investor deck, the company released a construction update video for our viewing pleasure:
Budget Remains Unchanged
The company has re-affirmed its commitments to both construction timelines and budgets for its Origin 1 and Origin 2 facilities. The total construction cost of O1 is expected to be $125-130 million, and the company is expecting about $1 billion for O2. They remain confident that "financing assumptions for Origin 2 are reasonable and executable, helped by pending state and local incentives worth more than $100 million and a Private Activity
Bond (“PAB”) allocation of $400 million."
The PAB is now in the hands of the Louisiana State Bond Commission and is expected to be on the docket at an upcoming meeting. It has already received approval from the Louisiana Public Facilities Authority.
The company has pointed out several sources for federal incentives:
Origin has excellent representation, with the highly experienced Bryan Soukup directing their policy & legislative affairs:
Co-CEO's Presenting at Credit Suisse Climate Tech Conference
Being held virtually on December 6-7, the Credit Suisse Climate Tech Conference will allow John Bissell and Rich Riley to conduct meetings with institutional investors. This news was actually the only other piece of news to be officially released by the company in November, in addition to the earnings release at the beginning of the month. Unfortunately, it appears there will be no public access to these upcoming virtual presentations.
Speaking of Credit Suisse, the ADRs have cratered to an all-time low as investors have lost confidence in the Swiss bank's leadership amid massive losses and woes about the company's financial health:
Once again, I digress.
Emerson Officially Announces Partnership I Dug Up in October
I will go ahead and toot my own horn on this one. Through some classic internet sleuthing, I was able to uncover information that I used for my blog post titled Origin Materials and Emerson Partner for Digitalization & Operational Excellence on October 26, 2022.
The official announcement, Emerson to Automate Origin Materials’ New Carbon-Negative Materials Plant, came out on November 9, 2022. What I found interesting is that this news came from Emerson, not Origin. It really speaks volumes that a company the size of Emerson Electric, $55.77 billion by market cap as of today to be exact, felt it necessary to announce their relationship with a pre-revenue company. It sounds like a bid of confidence in Origin to me.
John Bissell Featured in Two Podcasts
Wall Street Journal - Sustainable Business
Products Made With Captured Greenhouse Gas Are Reaching Commercial Scale
Indeed they are. We are about 4 months away from startup of O1. Origin Materials, along with Newlight Technologies, get a solid write-up in the WSJ article.
