Xebec Adsorption (TSX: XBC) this morning announced that it has received a major new purchase contract. Referred to as a master service agreement, the company has entered into an arrangement with a large dairy farm project developer for the sale of a number of Xebec’s BGX Biostream units.
An initial 18 units are to be sold under the arrangement, with the company indicating that the potential for additional orders exists under the same arrangement. As a result of the arrangement, and further orders the company expects to receive, Xebec has started the production of a total of 30 Biostream units that are expected to be delivered to consumers over the course of the next twelve months.
The Biostream devices are expected to be produced at the firms Canadian facility, which is being modified to enable the annual production of up to 40 units.
While the company did not indicate specifically the value of this contract, which is reportedly the largest single unit order received to date by the firm, Xebec indicated that the Biostream begins at a list price of US$1.5 million. Assuming the firm is paying list price, this would equate to a purchase order worth roughly $27.0 million.
The BGX Biostream utilizes animal manure feedstocks to produce what is referred to as renewal natural gas. As a result, the units are ideal for large dairy, poultry and swine farms.
Xebec Adsorption last traded at $4.14 on the TSX.
Information for this briefing was found via Sedar and Xebec Absorption Inc. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
