In 2016, we substantially reduced the Company’s monthly cash burn rate as a result of actions taken in 2015 and 2016, which resulted in a $487,830 reduction of professional Fees, a $222,135 reduction in compensation expenses and a $154,603 reduction in other operating expenses. We continue to monitor our operating expenses closely and exploring every avenue, including the March 31, 2017 sale of vacant land and building we own in Thorold, Canada. This property has a mortgage securing approximately $206,910 of debt. (See Note 17). We are also seeking to rent the idle blending facility to a qualified independent operator.
Our 2016 financing activities came from cash raised through short-term loans from our CEO and non-related party strategic investors. Some of these investors have experience in systems integration and we believe that their engineering and operations experience will be instrumental towards delivery, set-up and sale of the P2O processors through commercials partnerships.
U.S. Patent Application No.: 15/362,102 Titled, SYSTEM AND PROCESS FOR CONVERTING PLASTICS TO PETROLEUM PRODUCTs, was published on March 16, 2017 under Publication No. US 20170073584 and is available on the USPTO website at patft.uspto.gov/.
Our 2017 P2O sales and marketing program are expected to include direct sales as well as new partnerships . To that end, we made the decision in early 2016 not to further extend our agreement with EcoNavigation LLC as their firm has been unable to conclude processor sales on acceptable terms. The 2016 initiative started with P2O in discussion with Southern U.S. technology company regarding potential licensing of the Company’s technology and potential customer for up to six processors . The discussion has moved from an executed MOU to the drafting of the definitive agreement. This could lead to purchase of two processors in 2017, although there can be no assurance as negotiations remain ongoing.
Through years of testing and refinement in conjunction with our outside engineering firm, we are considering bringing our flagship processor #3 back online in late 2017 . It will be important to be able to demonstrate the commercial viability of this processor by regular (pilot) operations at our Niagara Falls plant to potential customers. Of primary influence to our decision to expand our sales efforts and to bring the flagship processor #3 back on line is our view based on analysis and consultation that oil prices have reached a bottom and could rise to $50 a barrel by the end of the 2017 .
While the price of crude is a factor in certain economic analysis pertaining to our processor sales, it is not the only factor. There are significant costs associated with landfill disposal. Financial decisions regarding P2O’s technology are based on the results of models that are tailored specifically to each potential client. These include, but are not limited to, the anticipated life of a processor or cluster, specific configurations of customers’ sites and facilities on hand, and the ability to integrate P2O’s technology into existing operations.
Internal Changes
While our primary focus continues to be on the sale of our disruptive technology, a number of internal operational changes are being considered:
1. Management expects the Niagara Falls plant to provide a source of revenue during it pilot and demo operations. We plan to raise additional outside capital for the restart of flagship processor #3 and we are also considering modifications to our processor #2 in order to improve economies of scale and deliver cash flow.
2. Plastics2Oil owns a fully permitted fuel blending facility in Thorold, Canada. Regional demand justifies bringing the facility back on line with intentions to lease the idle blending facility to a qualified independent operator.
3. P2O will continue to draw support from our loyal shareholder base that includes individuals with impressive business credentials, experience and acumen. In 2016 P2O raised secured debt financing from investors with systems integration and operations experience who can partner with P2O in the delivery, set-up and sale of P2O Processors. Valuable strategic suggestions have been offered and are being evaluated. P2O is also considering making important additions to support the 2017 sales and marketing initiatives. This will require a project management team and P2O may also require an ancillary advisory board.
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Our 2016 financing activities came from cash raised through short-term loans from our CEO and non-related party strategic investors. Some of these investors have experience in systems integration and we believe that their engineering and operations experience will be instrumental towards delivery, set-up and sale of the P2O processors through commercials partnerships.
U.S. Patent Application No.: 15/362,102 Titled, SYSTEM AND PROCESS FOR CONVERTING PLASTICS TO PETROLEUM PRODUCTs, was published on March 16, 2017 under Publication No. US 20170073584 and is available on the USPTO website at patft.uspto.gov/.
Our 2017 P2O sales and marketing program are expected to include direct sales as well as new partnerships . To that end, we made the decision in early 2016 not to further extend our agreement with EcoNavigation LLC as their firm has been unable to conclude processor sales on acceptable terms. The 2016 initiative started with P2O in discussion with Southern U.S. technology company regarding potential licensing of the Company’s technology and potential customer for up to six processors . The discussion has moved from an executed MOU to the drafting of the definitive agreement. This could lead to purchase of two processors in 2017, although there can be no assurance as negotiations remain ongoing.
Through years of testing and refinement in conjunction with our outside engineering firm, we are considering bringing our flagship processor #3 back online in late 2017 . It will be important to be able to demonstrate the commercial viability of this processor by regular (pilot) operations at our Niagara Falls plant to potential customers. Of primary influence to our decision to expand our sales efforts and to bring the flagship processor #3 back on line is our view based on analysis and consultation that oil prices have reached a bottom and could rise to $50 a barrel by the end of the 2017 .
While the price of crude is a factor in certain economic analysis pertaining to our processor sales, it is not the only factor. There are significant costs associated with landfill disposal. Financial decisions regarding P2O’s technology are based on the results of models that are tailored specifically to each potential client. These include, but are not limited to, the anticipated life of a processor or cluster, specific configurations of customers’ sites and facilities on hand, and the ability to integrate P2O’s technology into existing operations.
Internal Changes
While our primary focus continues to be on the sale of our disruptive technology, a number of internal operational changes are being considered:
1. Management expects the Niagara Falls plant to provide a source of revenue during it pilot and demo operations. We plan to raise additional outside capital for the restart of flagship processor #3 and we are also considering modifications to our processor #2 in order to improve economies of scale and deliver cash flow.
2. Plastics2Oil owns a fully permitted fuel blending facility in Thorold, Canada. Regional demand justifies bringing the facility back on line with intentions to lease the idle blending facility to a qualified independent operator.
3. P2O will continue to draw support from our loyal shareholder base that includes individuals with impressive business credentials, experience and acumen. In 2016 P2O raised secured debt financing from investors with systems integration and operations experience who can partner with P2O in the delivery, set-up and sale of P2O Processors. Valuable strategic suggestions have been offered and are being evaluated. P2O is also considering making important additions to support the 2017 sales and marketing initiatives. This will require a project management team and P2O may also require an ancillary advisory board.
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