We don’t believe so. Our technology is highly flexible in terms of the type of ‘wood’ that we use. It can range from wastepaper and cardboard, agricultural waste, scrap wood from other processes, etc. We may also use wood residues from sustainably managed forests, which are grown and farmed specifically to serve the kraft pulp mills. In any feedstock scenario, we believe that our approach will be entirely sustainable.
No. Our technology is highly flexible and can use many different feedstocks, including most cellulosic biomasses, wastepaper and cardboard, construction waste, and agricultural waste. We anticipate consuming a negligible portion of the North American or world wood supply, even before taking into account the availability of these other possible feedstocks and the anticipated supply response from sustainably managed timber farms. The sustainably managed timber that we can use is plentiful and commonly used by kraft pulp mills. It is ‘low value’ wood in that fiber length, size and height aren’t concerns for us and it isn’t timber that would be used for higher value, structural lumber. This type of timber is too low value to transport beyond a couple hundred-mile radius and is often captive to a small number of facilities providing long term price stability. As a result, what happens in a particular geographic region doesn’t have a strong impact on any other region, and construction of new facilities generally considers feedstock supply and availability in that region.
Our base case financial forecast assumes pricing consistent with projected fossil-based PET pricing found in leading market research publications and with the prices we have in our existing customer contracts. Ultimately, we would expect to see a pricing premium over fossil-based PET given customers’ strong desire for materials which help them with their net-zero pledges and as regulators globally implement carbon taxes and other measures intended to reduce CO2 emissions.
Conceptually, fossil-based PET extracts and releases carbon trapped in the ground as oil. Our sustainable, carbon-negative PET uses trees to capture CO2 in the air, which we then convert into products that keep that CO2 trapped. Our zero or negative carbon material claims have been substantiated by an independent Life Cycle Assessment (“LCA”) report from Deloitte that is available on our website. The LCA report tallied up the cradle-to-gate carbon footprint from feedstock material, chemicals, catalysts and production processes.
Given current customer demand, we believe we could sell out Origin 1 and 2 if that were our strategy. However, we have decided to reserve capacity to sell to new customers in different industries who have higher margin applications for our materials. We believe this strategy will allow us to achieve a customer diversification that can drive higher growth in the medium and long term. In addition, we expect the market price for low and negative carbon materials is likely to rise over time given the increasing demand for low or zero carbon materials as major companies make “net zero” pledges.
We use wood residues, which are chipped (cut down to pieces around the size of a playing card) and then digested in our chemical process, which subsequently produces both CMF and HTC. CMF will be converted into paraxylene, which will then be tolled through an existing PET producer and sent to our customers as PET pellets. This is how our customers currently receive their fossil-based PET from the same PET producers, making our solution truly drop-in ready. In the case of PET, we plan to sell the PET directly to the customer and take responsibility for the manufacturing of PET, including any third-party tolling arrangements from paraxylene to PET. For HTC, we have the technology and equipment to convert it into HTC fuel pellets, activated carbon, carbon black, etc., which we plan to sell directly to the customers.
In general, we work and contract directly with corporate brands like Danone, Pepsi, Nestle, etc. for our products. We envision continuing to do so in future as we engage with new customers in different industries. In addition, we are also pursuing relationships with materials and chemicals companies that may use our products as input for their products, which can be sold to their branded customers.
We don’t expect to produce any hazardous or dangerous by-products that cannot be safely disposed.
The Eastman licensed patent is not a core part of our technology and our platform is not dependent to a material extent on any licensed intellectual property. We acquired a license to the Eastman patent because we thought that it may be valuable to our customers if PEF is widely adopted. The technology around our core process has been developed in-house over the last 10+ years and is protected by both our strong patent portfolio and by proprietary intellectual property, including trade secrets. That core technology belongs to us. Over the years, we have opportunistically licensed technology that may potentially help enable our customers with certain applications. This includes the Eastman patent for creating PEF from our CMF.
We estimate that the payback period (the ratio of capex to annual EBITDA) will be approximately 2-3 years, depending on the plant.
The proceeds from this transaction, in combination with additional project financing and government incentives, are expected to fully fund our business plan until positive EBITDA in 2025.
While our current projections assume build-own-operate economics, we are open to entering into licensing agreements if we think this would add value to the company and shareholders. Given the size of our TAM and increasing customer demand, we anticipate that technology licensing will be a topic frequently raised by both our customers and traditional chemical companies.
We choose to go public via a SPAC because we believe it will provide us the fastest and highest certainty of raising the required capital to build our plants. We believe that our technology is proven and ready to scale. We have substantial demand from customers and were seeking the financing path that would most quickly and efficiently fund us to commercial scale.
We choose Artius Acquisition Inc. as our SPAC partner because of the experience of its sponsor and directors with raising capital in the financial markets, expertise in operating public companies and a shared long-term vision for a decarbonized world.
Origin Materials is listed on the Nasdaq Capital Market under the ticker symbol “ORGN”.
To purchase shares of Origin Materials, please contact a brokerage firm.
Origin Materials’ transfer agent is Continental Stock Transfer & Trust Company. They can be contacted at:
Address: 1 State Street, 30th Floor, New York, NY 10004-1561
Phone: +1(212) 509-4000
If your shares are held through a brokerage account, you must contact your broker. If your shares are held by you in your name, please contact Origin Materials’ transfer agent at:
Address: 1 State Street, 30th Floor, New York, NY 10004-1561
Phone: +1(212) 509-4000
Origin Materials operates on a calendar year that ends on December 31.
Origin Materials currently intends to retain all available funds and any future earnings to fund the development and growth of its business and to repay indebtedness, and therefore does not anticipate declaring or paying any dividends in the foreseeable future.
At this time, Origin Materials does not have a direct stock purchase program.
The CUSIP number for Origin Materials’ common stock is 68622D 106. The CUSIP number for Origin Materials public warrants is 68622D 114.
Origin Materials’ independent registered public accounting firm is Grant Thornton LLP.
The date, time and location of the annual meeting of stockholders is announced in the company's annual proxy statement filed with the SEC and is available at: SEC Filings.
Artius Acquisition Inc. (Nasdaq: AACQ) (“Artius”) was a publicly-listed special purpose acquisition company formed for the purpose of effecting a business combination in the technology sector. In February 2021, Artius entered into a definitive agreement for a business combination with Origin Materials. In June 2021, the parties completed the business combination, Artius changed its name to “Origin Materials, Inc.” and the combined company began trading on the Nasdaq under the ticker “ORGN”.
When an earnings release is scheduled, all details will be posted on the Events & Presentations page on Origin Materials’ investor relations website.