 Do you want to learn how to trade stocks and cryptocurrency? Join our community of traders, go to richpicksdaily.com and find the next 10-Bagger. What are you doing today? I'm your host Rich here on behalf of Rich TV Live with our very special guest Aiden Mills, the CEO of Northstar Clean Technologies. How are you doing today Aiden? Great Rich, how are you? I'm doing fantastic. Very excited to learn more about your company Symbol Roof R-O-O-F and I have a few questions for you today. First of all, I'd like to ask Northstar Clean Technologies is a clean technology company dedicated to the processing, extraction and recovery of single-use asphalt shingles. Can you tell us a little bit more about the company? Sure, so our company basically takes single-use asphalt tiles and reprocesses them into their individual component parts to a sales quality specification and so let's step back and talk about what a asphalt shingle looks like. So a shingle tile is basically made up of three different things. So 50% of the tile is sand, 25% is fiber, the older tiles the fiber will be paper and the newer tiles the fiber is fiberglass and then the remaining 25% is asphalt oil. So basically we have developed a completely proprietary technology. We believe we're the only people in the world who have the technology to be able to split that shingle up into its individual component parts. Wow, that's incredible. Now what fueled the company's decision to focus primarily on solving the asphalt shingle waste problem? Well look, if you think about the industry of repurposing waste either back into products that can be used or products that can be used in heat or mobility etc, the technology emerged about 10 years ago from Lafarge. Lafarge decided to look at this because essentially because of, if you think as we said before, 25% of everything that's going into a landfill as a shingle tile is asphalt oil. So Lafarge, who were a major paving company, decided let's have a look at this. They took it to a point whereby they presented the capital and Lafarge decided not to progress it and the two of the founders that were involved in our company thought this is a really good idea. So they took the technology from Lafarge under agreement with Lafarge and we'll talk a little bit about what that actually means with respect to sales contracts later. But yeah, so they took that technology out and started to develop it and so that was about 10 years ago. About five years ago they formed the Empower company and started to develop the site that we have at Delta. And so there's a single site at Delta and people are like, well is this just like a small technology play? Is this just focused? No. The market size for this essentially is the whole of North America. So when you look at what's happening with asphalt shingles today, and you look at the figures in the US, for last year 13 million tons of asphalt shingle tiles came off roofs to be reprocessed. One million of that got is kind of grind up and put in the road. So no matter where you live, if you google you know, recycled asphalt shingles, there's companies all across North America that do this and what they do is they take the tile, they grind it up and then they put it back in roads. So that represents one million tons. So 12 million tons actually goes into landfill. And let me tell you what 12 million tons kind of means in real money. So 12 million tons of asphalt shingles is about 3 million tons of asphalt oil. And 3 million tons of asphalt oil is more than 18 million barrels of oil. Wow. And that is equivalent to one year, one day's worth of US oil production. So the problem that we're trying to solve essentially is that in theory in the first of January, all of US production pouring into landfill. That's what we're trying to address. So what exactly you may have touched on this is the zero waste trend and what impact does it have on North Star's business? Well, if you think about what we're trying to do with respect to diversion, recycling, the circular economy, there's three major trends that are going on. Number one, if you look at, for example, if you look at the clean cities objective, clean cities are trying to reduce what can go into landfill as much as they possibly can. Some have set targets of 50% reduction by 2030. So what that means for us is we literally can go to every municipality and say, give us all your asphalt shingle tiles and you can stop those going into landfill. And we don't produce it. We don't repurpose it and give them a really nasty by-product back. We take it all. So in one single shot, we can literally take all the asphalt shingles as part of that zero waste. The second thing is ESG. So if you think about the asphalt that comes at the back end of our process, it is literally the only green asphalt in North America. So if you think about a green product that is part of a circular economy and ESG, that's fantastic and that's what we do. And the third thing is the circular economy. So if you think about a lot of the trends, so let's take plastics, for example, you know, plastics get recycled, ground up, repurposed and back into plastic pallets that go back into making plastic bottles, for example. And that's exactly what we do. So if you think about something that is literally straight down the fairway of waste repurposing, circular economy and ESG support, those three big things, this company is right down the fairway. That's fantastic. You guys are doing some great work. What do you believe is the market opportunity for North Star? Well, look, I think the market opportunity is if you look at the size of our facility, and we'll talk a little bit about our expansion facility in a minute, but if you look at the size of our expansion facility, it can probably process about 150 to 200 tons a day of asphalt shingles. The market size that is good for that is any city that has over a million people. And so that generates enough asphalt shingles coming off roofs, new roofs being purposed at demolition waste, et cetera, that we can build one plant. And if you think about a city like, let's take Toronto, so our first expansion plant, we'll chat about it later, but our first expansion plant will be based in Calgary. So you think the size of Calgary over a million people. Well, if you go to somewhere like Toronto, that can have four of our facilities. If you go to LA, it could have 10 of our facilities. As long as it's over a million people, that number of tons generates enough for one of our plants. So every CEO will say the market size is unparalleled. The market size for this plant, in my opinion, across North America is absolutely huge. That's incredible. Now, what sets North Star apart from the other companies in the space? Well, look, there's a number of different companies that we would call peers in the space because they're taking a waste product. And then they're as part of kind of a circular economy thing, they're generating stuff that comes like the back end. We're the only people that can do it for asphalt shingles. We're really, really focused. So I actually get the question quite often, well, look, this technology looks great. Can you do? Could you put this into it? Could you put that into it? I'm like, ah, no, we absolutely have to be ruthlessly focused on the execution plan. We have 12 million tons in the US and one and a half million tons in Canada to just to secure. So the first thing we are is very focused. And the second thing we are is this isn't a 2030 ESG plan. This is ready, not our Delta facility, the Empire facility in Delta is targeted to move to steady state production in one queue revenue production, you know, around about the same time as well. So this isn't the difference between us. I think a number of our peers is they have developing technologies. We literally have a technology that is ready to go. That's incredible. Now, I know that North Star expects to reach commercial production and begin generating revenue early next year. Can you tell us about the company's multiple revenue streams and your term revenue projections? Sure. So the first step in this is we, so I talked a little bit earlier about the technology being improved. So we this month ran commissioning runs at the facility in Delta. And commissioning runs are really important because they do two things. The number one proves that the technology works. So, you know, at the back end of the plant, we get we got aggregate and fiber and oil. So we know that the technology works. And now, also during that process, we identified the steps that we need to take to get to steady state production. So we're very confident that will happen in that in Q1 next year. And if you look at the revenue for that for the plant, there's really five buckets of revenue that comes in from the plant perspective. So the first thing is, if you're if you take some Asheville Jingle tiles in off a roof in Vancouver, and you drive it to the landfill, you have to pay a tipping fee of about 130 bucks a ton for every ton of Asheville Jingle that you put in the landfill. So our Delta facility is five kilometers away from the Vancouver Metro landfill. So the first part of the business model is we get the roofers to turn right to our facility instead of left to the Metro facility. And when they come to us, now we'll give them an advantage rate. So we will have a landfill tax that is lower, a tipping fee that is lower than the Vancouver Metro landfill. And so that's the first revenue stream. And when we bring the trucks in, we've got kind of three things to do. Number one, we offer the guy who runs the company an incentive of 20 bucks a ton of advantage to come to us. Number two, it's not like a landfill queue. We can literally unload the trucks within 15 minutes. And the third thing is we might even give the truck driver a cup of coffee and make sure that whenever he turns up, he gets a cup of coffee and a bacon road or whatever when he drops the stuff off. So that's the first kind of part of the revenue model and part of the marketing stream to bring that in. And then you think, so then we process and then at the back end drops fiber and aggregate, so sand. And that's fine because that can go into local markets. Now, are any sand buyers going to give us a huge premium because it's green? Probably not. But we know that there's a local market. There's no supply issues or no demand issues. So we can take those products into the local market. But the third thing at the back end, it's really important is asphalt. So if you think about asphalt, think about the guys who use asphalt for the roads, whether it's Lafarge or Colus or Dow Corning all across North America. I mean, today, when they show their production graph or their usage graph, it's like, you know, here's the usage graph of their asphalt, their black line of asphalt. Suddenly, as we build our plants, we start to introduce a green recycled line. Now, I'm not going to tell you that that's necessarily going to be three times the price of asphalt, like, like jet fuel, green jet fuel is versus jet fuel. But we believe that there's upside for that because we believe there will be a green premium, a green premium above market for asphalt coming out the back end. And then the fifth, the fifth part of the model is what we're studying now. And that's what is the CO2 footprint of our facility. We believe because of the way that we're processing it, we have a CO2 footprint that is significantly lower than the virgin production of asphalt, you know, at the back end of refineries and from aggregate, etc. So we believe there'll be a carbon credit element. And we know, we certainly know. And the carbon credit element depends, it often depends on the jurisdiction. It depends on the state law or the provincial law, you know, what the federal regulations are for measuring the carbon credit. But I can tell you for sure that our view is that we will use less carbon to generate a ton of asphalt versus virgin production. So as we run every hour, we will have carbon benefit with our production model. So we still have to do a lot of work about how to monetize that. But that's the fifth revenue model that sits over the whole top of the process. So you have the tipping fee in the front end, three products in the back end, and then the carbon benefit that sits on top. Aiden, one of the things that we really look for here at Rich TV Live is companies that are well funded, well capitalized, with little to no debt. Can you talk a little bit about your financial structure? Sure. So look, this is the thing that I think is really exciting about the company. As I said earlier, so we IPOed on the 13th of July. That generated about, you know, 12.2 million of a raise and all equity raise, so all retail equity, no institutional investors in as yet. So all people like the community you serve. So let's talk about where we are now. So at the end of the last quarter, the last quarterly results, we had 10 million dollars worth of cash on the balance sheet. All of that, about 0.9 of that was debt, but that's a credit revolver to a local friendly Vancouver finance institution, so not term debt. But if you step back and you think about our capital spend, so, you know, it's probably going to cost us a round about a million dollars to get the Empower facility up and running. We have, as we talked about, we have the engineering and the RFP to be done for the expansion plant, and we obviously have the development of the business to get ready for that. But Rich, there's nothing in our capital structure at all at the minute from government subsidies. So we have Wellington DePont, who are our government and public affairs advisor, based in Ottawa, engaging, along with us, engaging the federal government, provincial governments, and municipal governments about the level of support that they could be able to provide to something that is literally right down the fairway of the green infrastructure play. So none of that 10 million worth of cash is any government funding as yet. So that's one of the big things to look forward to that we're driving forward. The second thing is, there is no term debt in the structure. So we literally have no debt in that 10 million dollars worth of cash that is term debt that we will need to build these facilities out. So the expansion plant capacity, as I said, 150 to 200 tons a day, but also probably costs about 10 million bucks to build. So this isn't a renewable ESG plant that's going to cost 100 million or 150 million. Every single facility can be put in these cities and they cost 10 million dollars. So the plan that we have after the Calgary facility in Q3 is to think about potentially between then and the end of 2023, six plants. So a plant per quarter. And so that's a $60 million kind of build program. And we think that the equity that needs to go into that, it might only need to be like 25% that we may have 25% government subsidies and 50% green term debt, which of course is advantaged because every hour we run, we generate a carbon credit. Wow, you guys got it all figured out. Now the company already has a number of supply and offtake agreements in place. Can you tell us a little bit more about those? Sure. So the team that developed this five years ago, the first agreement with Lafarge, of course, was like, take the technology, you're good guys are good to run with it. But for the first three plants in Western Canada, Lafarge have an offtake agreement that we sell all the production to them. That's currently priced at what I would describe as a commissioning contract level. So five years ago, when Lafarge were talking to the empire, the finders, they were like, okay, so you're not sure when you're going to produce, you're not quite sure what the quality is going to be, et cetera, et cetera. Now we've got and so priced, you know, priced at 300 bucks a ton. So now we're in a position whereby we have quality, we know the quality is good, we have, you know, we're clear about when we're going to be producing, we have a good idea about how much we're producing, so it can fit perfectly into their offtake plans. So our discussions with Lafarge are now, well, this should reflect more of a market price. And so if you took the market price, for example, in Vancouver today, it's probably in the kind of $600 to $700 a ton. So, you know, asphalt pricing, it depends on its seasonal, it also depends on oil price. But again, we have the only green asphalt in North America. So we believe that there's a strong market capability and market pricing dynamic for our asphalt too. So that's the discussion ongoing with Lafarge. So we have three plants in Western Canada planned. For the rest of North America, we've now started discussions with both Lafarge and some of the other providers who take asphalt to talk to, including not only paving guys, but if this is a perfect circular economy play, it will go back into roofing. So, you know, we're talking to a number of roofers as well about what those offtake agreements could look like. From a debt perspective, we'll talk a little bit about the capital structure in a minute, but from a debt perspective, we believe if we have supply in the front end and we have an offtake agreement for the majority coming out the back end from a asphalt perspective, that you could fund that with ordinary debt today and green debt on top of it will be even better because we know that there's the CO2 benefit. Now here at Rich TV Live, we love to understand the fundamentals of the company. We also like to understand the management team behind the company. North Star's leadership team has an impressive 280 years of combined operational and capital markets experience. Can you tell us how this contributes to the success of the company? Well, look, I mean, I like the 280 years, but to me actually that could be 280 years of not good experience. So let me tell you why I think our team really works. Sure. So if you think about the team, it's really made up of three, the leadership team has made up of three constituent parts. The first thing, and it's absolutely crucial is, you know, we have the finders of the company and we have the finders of the technology. So the people who literally can walk up to a pump, put their hand on it and go, hmm, I think this should be running better. You know, so they know exactly how to produce the products at the back end. It was their idea and they're hugely vested. The two of the finders own 5% of the company each and so absolutely locked into the success going forward. Also part of the management team is some of the guys that did the capital raise. So Empower was a standalone company. North Star then acquired Empower and it was North Star and the leadership team in North Star that did the capital raise. So IPO in the 13th of July, $12.2 million worth of equity cash came into the company to drive the next steps forward. And so that team is still in place as well. And I joined on the 12th of July. So look, my background is, you know, 20 years of BP, 10 years in operations and engineering, 10 years in commodity marketing and trading and offtake agreements, just like we talked about. And then the last 10 years, both at Husky and at Goldman and at Meg, you know, working on the strategic development of businesses. And so me joining enables the kind of third level to be added to the leadership team about how do we drive this business forward and commercialize it. So if you step back, ignoring the 280 years, the three really important component parts of the operation and engineering and the understanding, the financing and how we're helping with the capital markets and driving the strategic business forward, that's what the leadership team has today. I love it. And what should investors watch out for from North Star Clean Technologies in the coming months, years? Well, look, the first thing we talked about earlier was the Empower Plant in Delta. So it should move to steady state production and Q1. So that steady state production to me is probably about, you know, 50 to 100 tons a day. The other thing, and we're going to be announcing this quite shortly, the other thing we've done is we've done an RFP process for a category engineering company. We had three companies that bid for it. We're just about to finalize the agreement with one of those companies, and that's to build the expansion plan. So the plant in Delta is an excellent plant, but it's an entrepreneur plant. It's not a fully engineered plant. And that's what the tech, that's what the engineering provider will do. And that detailed design for the expansion plants will be ready probably about the end of Q1. That's our target. So once that's ready, then essentially we can start the rollout program. So the rollout program will start with Calgary. So we will likely start, we'll likely start construction in Q3. We think from kind of first saw being turned to commissioning, it's probably about six months. So in theory, investors can expect the first expansion plant online by the end of next year. And that expansion plant, that's 150 to 200 tons a day. So that's actually an important point as well with respect to ESG, et cetera, and repurposing plants for this new technology. Like this is ready to go, but the scale-up risk from the current plant to the expansion plant is like times two. So I'm not saying to people, hey listen, invest in us. I have something on a bench in a laboratory and the risk you're taking is a times 50 or a times 100 scale. This isn't ready in 2020. We literally have a scale-up that is two to three times ready by the end of next year. The other thing that we chatted about earlier quickly was the CO2 benefit. The CO2 study should be ready again within this quarter to be able to talk about what we think the benefit is of both the empower plant and Delta, but also the expansion plant. Now, to be fair, we'll know more about the expansion plant carbon footprint whenever the detailed engineering is done by the end of Q1. But indicatively, we should know both of those figures this quarter this year. And so that's something for people to look forward to, because we'll be able to actually say, not only do we believe we're green, but here are the indicative figures that demonstrate that from a carbon perspective. Finally, how can investors get in touch with North Star? So let me just have a quick look at our IR deck. So one of the best ways to get in contact with this from an IR perspective is to talk to kin communications. They are investor relations supporting. So that is roof at kincommunications.com. Our director of capital markets at North Star is Carson Sadon. He's Carson at northstarcleantech.com. And as the CEO, I'll give my contact as well, which is aiden at northstarcleantech.com as well. Fantastic. Now, I must remind everyone who's watching these videos that Rich TV Live is strictly for information and education purposes in saying that, I do believe this is a company that's undervalued, underappreciated, underexposed. Thank you so much for joining us today. The CEO of North Star Clean Technologies, Aiden Mills. Rich, thanks very much. Thanks for your time. Always a pleasure. Love to invite you back on the show. If you ever have any big breaking news or anything you want to talk about with our community, we'd love to invite you back. Thank you for your time today, Aiden Mills. And thank you guys for watching. If you're not winning, you're not watching. You're bringing the winners and we're bringing them to you first. Thank you for watching, everybody, and have a nice day.