Millennium Investment & Acquisition Company Inc. Achieves
Key Milestone and Provides Corporate Update on Millennium Carbon
Division
Restored all production equipment to operational status and has
produced Activated Carbon
Targeting initial commercial operations by early 2018
Plant can generate in excess of $5 million of annual cash flow
once fully operational
NEW YORK, NY-(Marketwired - Aug 17, 2017) - Millennium
Investment and Acquisition Co. Inc. (OTC: MILC), today provided a
corporate update on its Millennium Carbon division which owns an
Activated Carbon plant in Hawaii.
HISTORIC BACKGROUND On June 11, 2015, MILC, through a wholly
owned subsidiary ("Millennium Carbon") completed the acquisition of
an Activated Carbon plant located near the port of Kawaihae, Hawaii
for $1.28 million. The acquisition consisted of 13 acres of land
leased from the Department of Hawaiian Home Lands, the existing
equipment and approximately 24,000 tons of macadamia nutshells
which represent more than a 2-year feedstock supply.
MILC believes this acquisition is a compelling opportunity that
should generate an attractive return on investment. The acquisition
price is a small fraction of the more than $44 million originally
invested in the plant from 2009 to 2012. Despite commencing
operations in 2011, the plant failed to achieve full commercial
operations and generate profits. It ceased operating in 2012 and
its owner filed for bankruptcy. Prior to shutting down, the plant
produced Activated Carbon but there were a number of design and
operational issues that needed resolution in order to produce the
premium Activated Carbon that it was targeting and operate the
plant on a full time basis. MILC is in the late stages of upgrading
the plant to establish full commercial operation.
When operating, the Millennium Carbon plant will process a waste
stream of macadamia nutshells into a special form of Activated
Carbon. Activated Carbon has many small pores that create an
extremely large surface area. By way of example, one teaspoon of
the Activated Carbon the plant intends to produce has a surface
area greater than a football field. Activated Carbon's large
surface area and complex network of pores provide benefits in a
variety of chemical processes including filtration, purification
and energy storage.
The Millennium Carbon plant is designed to produce a
premium-grade Activated Carbon with characteristics that are
particularly attractive for energy storage applications and that
should command a price premium relative to commodity-grade
Activated Carbon. In particular, the Activated Carbon produced by
the plant is targeted for manufacturing Electrical Double-Layer
Capacitor (or "EDLC"), which is commonly referred to as
Ultracapacitors or Supercapacitors, an advanced energy storage
alternative to traditional batteries. Ultracapacitors are found in
a diverse array of electronic equipment from daily usage engine
starting, hybrid and electric vehicles to windmills.
CURRENT UPDATE Millennium Carbon is in the late stages of
commercializing the plant for continuous production of premium
Activated Carbon. From a production standpoint, the plant can be
thought of as having three phases:
1) Material handling and pre-processing a. Screening out debris
b. Hammer mill to create uniform nutshell chips c. Screening to
appropriate size nutshell chips and eliminate fines
2) Char Production a. Macadamia nutshell chips are heated to
high temperature in the absence of oxygen in a Char Reactor to
perform pyrolysis b. Pyrolysis reaction breaks down the nutshells
into high purity char of carbon and removes volatile matter which
will provide an energy stream to help power the plant (biogas and
condensed bio-oil)
3) Activation a. The nutshell char is heated in a rotary kiln
and mixed with high temperature steam to create the large surface
area/pore structure
In addition, the Millennium Carbon plant has numerous support
systems including:
- Laboratory
- Nitrogen generation
- Low grade steam boilers
- High temperature steam "super-heater"
- Water well and Reverse Osmosis water treatment plant
- Integrated instrumentation and controls system
- Thermal oxidizer to meet emissions requirements
- 2 MW Diesel generator
At this point, Millennium Carbon has restored all production
equipment and necessary support systems to operational status and
has produced Activated Carbon. The following is a summary of the
current status of the plant operations:
Phase 1: Based on the work done to date, Millennium Carbon is
confident with the operation of Phase 1. The Phase 1 equipment has
been operated during day shifts while operating either Phase 2 or
Phase 3 to prepare the feedstock as needed.
Phase 2 Operations: Millennium Carbon believes that
modifications made to the Char Reactor have improved the
operational capability as well as the quality of the char being
produced which should lead to a better quality Activated Carbon
than was previously attained by the plant. At this point we are
confident with the ability to operate the Char Reactor. To date we
have had had three successful four day (24 hour per day) production
campaigns, most recently the week of July 31, 2017, and have
produced approximately 30,000 pounds of nutshell char.
Phase 3 Operations: Millennium Carbon continues to refine the
operations of the final "Activation" phase to get the output to the
targeted specification. This will involve additional operational
campaigns while adjusting factors such as kiln temperature, steam
temperature, ratio of steam to char and flow rate of char through
the kiln. Phase 3 is the critical element to producing the high
level of activation of the char that we are seeking. To date, we
have had three successful four day (24 hour per day) production
campaigns most recently the week of August 7, 2017 and have
produced approximately 16,000 pounds of Activated Carbon. The
initial internal laboratory testing of the Activated Carbon is
encouraging. We are meeting our objectives with respect to
Adsorption (Iodine Test), Ash Content and density. Additional work
remains with respect to refining the operation to increase the
level of activation (surface area) and pore structure which is
important for the key metric that will impact how much electric
charge can be stored per gram of Activated Carbon. As we continue
to produce improved quality Activated Carbon we will seek third
party laboratory validation of the results.
We are currently alternating running Phase 2 and Phase 3 rather
than running these simultaneously as part of a prudent plan to
minimize staffing and provide a focused effort on the operation of
each phase to gain operational experience. Ultimately, the plan
will be to operate Phase 2 and Phase 3 simultaneously and run Phase
1 during the day shifts when the plant is in full commercial
operation. Once fully operational the plant is intended to run 24
hours per day with periodic intervals for plant maintenance.
Achieving full-scale commercial operation and associated revenue
generation may still take a year or more after which the plant
should generate an attractive return on its invested capital. Given
the progress made to date, we currently are targeting initial
commercial operations by early 2018. Given our building confidence
in performance of the plant, we are commencing our "go to market
strategy" through an outreach to the ultracapacitor manufacturer
community.
In addition to the Activated Carbon processing equipment
described above, Millennium Carbon acquired a biomass power plant
that includes a waste boiler that can run off of the byproducts
(bio-gas and bio-oil) to produce steam to drive a steam turbine to
provide electricity and heat for the plant processes. This portion
of the plant is not operational and may be put into operation at a
later date. This will be evaluated based on the potential return on
investment from completing the installation and commissioning of
this equipment.
FINANCIAL PLAN Our current monthly cost to operate the plant in
the current testing phase is approximately $125,000 all of which is
being capitalized until we enter commercial operation. There will
likely be some additional capital cost beyond the cost of operating
the plant during this process refinement phase. The current
estimate for such capital costs is $600,000 with an estimated range
from $200,000 - $1,750,000 depending on what is ultimately
necessary to produce the quality of Activated Carbon contemplated.
Ultimately, Millennium Carbon currently believes that the plant can
generate in excess of $5 million of annual cash flow. There can be
no assurance as to how much capital or how long this process will
take or what the ultimate stabilized cash flow, if any, from the
project will be.
Millennium Carbon received preliminary approval for a government
guaranteed loan program to fund a significant portion of its
capital improvement. At this point, the anticipated capital
requirements have been reduced significantly from what was
originally estimated. As such, this financing has been put on hold.
As part of exploring the financing, Millennium Carbon received an
appraisal that estimated the "as-is and in place" fair market value
of the asset to be approximately $13.9 million as of the date of
acquisition. In addition, since acquisition, Millennium Carbon has
spent approximately $2.5 million.
ABOUT UTLRACAPACITORS A rapidly emerging and increasingly
applied technology, Ultracapacitors store electricity as an
electrostatic charge rather than as a reversible chemical reaction
like traditional batteries. In addition, Ultracapacitors are
capable of storing and discharging electricity very quickly and
efficiently to provide superior functionality when used in
conjunction with, or as a replacement for, conventional batteries.
Ultracapacitors also have virtually infinite duty cycles unlike
traditional batteries that degrade with every charge/discharge
cycle. Ultracapacitors are an inherently stable electric storage
device unlike lithium-ion batteries, which are unstable and can
lead to explosions or lead acid batteries that can leak acid. They
are also largely comprised of a renewable and bio-ingredient in the
form of Activated Carbon that minimizes disposal concerns.
Due to their many benefits, Ultracapacitors are currently being
utilized in thousands of applications. Ultracapacitors complement a
primary energy source, which cannot repeatedly provide quick bursts
of power, such as an internal combustion engine, fuel cell or
traditional battery. The future horizon looks brilliant for
Ultracapacitors as the need for energy storage continues to
accelerate.
About Millennium Investment & Acquisition Company Inc.
Millennium Investment and Acquisition Co. Inc. ("MILC"), formerly
Millennium India Acquisition Co., is an internally managed,
non-diversified, closed-end investment company. MILC currently
holds a minority interest in SMC Global, an Indian financial
services company, consistent with MIAC's past investment strategy
focusing on Indian investments. MILC now principally focuses on new
investments in alternative energy. Consistent with this new
strategy, MILC now owns an Activated Carbon plant in Hawaii and is
actively seeking to expand its portfolio.
MILC essentially owns two assets (in addition to cash available
for investment):
1) 10.5% of SMC Global - an India based financial services
company 2) An Activated Carbon plant located in Hawaii that
produces a premium grade Activated Carbon for use in advanced
energy storage.
Investors in MILC can gain financial exposure to India and
Alternative Energy which are both attractive sectors for asset
allocation.
www.millinvestment.com
About Millennium Carbon Millennium Carbon is a manufacturer of
premium Activated Carbon that is attractive for energy storage.
Millennium Carbon processes macadamia nutshell feedstock to produce
Activated Carbon through a two-stage pyrolysis and steam activation
facility located in Kawaihae on Hawaii Island. The plant can
process upwards of 12,000 tons of macadamia nutshells per year.
Activated Carbon is a highly porous substance that confers
benefits in various industrial and consumer applications including
in filtration, emissions, and pollution remediation. Millennium
Carbon's premium grade Activated Carbon has unique properties that
make it particularly attractive for the manufacture of
Ultracapacitors, an advanced energy storage device with significant
benefits relative to conventional batteries.
www.millcarbon.com
Cautionary Statement about Forward-Looking Statements This
document includes forward-looking statements within the meaning of
the U.S. securities laws. Forward-looking statements are those that
predict or describe future events or trends and that do not relate
solely to historical matters. You can generally identify
forward-looking statements as statements containing the words
"believe," "expect," "will," "anticipate," "intend," "estimate,"
"project," "plan," "assume", "seek" or other similar expressions,
or negatives of those expressions, although not all forward-looking
statements contain these identifying words. All statements
contained in this document regarding our future strategy, future
operations, future prospects, the future of our industries and
results that might be obtained by pursuing management's current or
future plans and objectives are forward-looking statements. You
should not place undue reliance on any forward-looking statements
because the matters they describe are subject to known and unknown
risks, uncertainties and other unpredictable factors, many of which
are beyond our control. Our forward-looking statements are based on
the information currently available to us and speak only as of the
date of the filing of this document. Over time, our actual results,
performance, financial condition or achievements may differ from
the anticipated results, performance, financial condition or
achievements that are expressed or implied by our forward-looking
statements, and such differences may be significant and materially
adverse to our security holders.
Contact: David H. Lesser CEO +1 (212) 750-0371
dl@millinvestment.com Investor Relations PCG Advisory Group Kirin
Smith COO ksmith@pcgadvisory.com 646.863.6519
www.pcgadvisory.com
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