The math showing the poor economics of converting
Post# of 43066
Posted On: 12/18/2014 10:55:38 AM
The math showing the poor economics of converting plastic into any type of 'fuel' should be extremely compelling. The people you see here still averaging down and pounding the table about PTOI are the people who don't understand that math and who have decided to ride the sinking boat to the bottom.
1) Look at PTOI's permit files with the SEC. They're allowed to use HDPE, LDPE and PP plastiics...appropriately those plastics which are only hydrocarbon. Other plastics have other elements which would end up in the resulting pyrolysis oil.
2) Look at the price of scrap HDPE/LDPE/PP plastic. That's somewhere between $0.25/lb to $0.35/lb on average. That's the price PTOI will have to pay for the plastic it would need. That scrap price, not surprisingly, varies with the price of crude oil.
3) Assume the best, most optimistic, most magical case possible for PTOI--that by using pyrolysis, PTOI can convert scrap plastic into pure, salable diesel at their stated 85% conversion rate. A gallon of diesel weights about 7 lbs and the spot price for diesel is currently about $2.10/gallon.
PTOI will lose money for every pound of plastic it pyrolyzes no matter how optimistic the outcome and that doesn't even include the cost of operating the processor.
The people holding onto PTOI stock for dear life are those who don't want to look at the math, who want to forgive Mr. Bordynuik for his past fraudulent activity and who are oblivious to the fact that five years eight months have passed with the company constantly giving excuses why they can never keep a processor running. The real reason is economics.
Do the math people...or you will end up in the same boat as all of the remaining longs.
1) Look at PTOI's permit files with the SEC. They're allowed to use HDPE, LDPE and PP plastiics...appropriately those plastics which are only hydrocarbon. Other plastics have other elements which would end up in the resulting pyrolysis oil.
2) Look at the price of scrap HDPE/LDPE/PP plastic. That's somewhere between $0.25/lb to $0.35/lb on average. That's the price PTOI will have to pay for the plastic it would need. That scrap price, not surprisingly, varies with the price of crude oil.
3) Assume the best, most optimistic, most magical case possible for PTOI--that by using pyrolysis, PTOI can convert scrap plastic into pure, salable diesel at their stated 85% conversion rate. A gallon of diesel weights about 7 lbs and the spot price for diesel is currently about $2.10/gallon.
PTOI will lose money for every pound of plastic it pyrolyzes no matter how optimistic the outcome and that doesn't even include the cost of operating the processor.
The people holding onto PTOI stock for dear life are those who don't want to look at the math, who want to forgive Mr. Bordynuik for his past fraudulent activity and who are oblivious to the fact that five years eight months have passed with the company constantly giving excuses why they can never keep a processor running. The real reason is economics.
Do the math people...or you will end up in the same boat as all of the remaining longs.
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Yes, I understand your penny stock also is the real deal, created with the inventiveness of Edison and destined to be the next Microsoft. Yes, I understand that the delays are also only because your company is making their product and/or technology even more revolutionary.