Plastech says its technology can halve the cost of recycling plastic – but first it needs some capital
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3.5 million tonnes.
By weight, that’s how many plastic products were sold in Australia during the 2017 financial year, according to the Australian Department of Environment and Energy.
Of that amount, just over 10 per cent was recycled — the rest goes unrecovered.
And those stats present a business opportunity, according to the team at Plastech Recycling who are looking to commercialise their patented PolyWaste plastic conversion technology.
To help drive product development, the company has tapped private markets for some extra capital via the crowd-sourced funding (CSF) platform Crowd88.
Speaking with Stockhead, executive directors Glenn Reilly and Colin Barker outlined some big plans for the PolyWaste product, which they hope will spur a fundamental shift in how plastic products are reused.
Broadly speaking, plastic recycling techniques involve a process where the plastic is melted down before it’s reproduced as a different product.
But it’s typically limited in two ways; you can’t combine different plastics, and the recycled products need to be cleaned first.
“If you talk to people who are expert in plastics, they’d say to you you can’t mix different polymers,” Barker says.
“But the unique thing about PolyWaste is that you homogenise the plastics at a molecular level, so there is no interface for different polymers.”
“People make a lot of effort to either separate the different polymers, which is expensive, or they try and cobble them together and they have to melt them multiple times to get them homogenised.”
By designing a machine that can melt different polymers, the company says it can reduce the cost associated with plastic waste by 60 per cent.
Reilly says a crowd-funding model suits the company at this stage of its life-cycle, largely because of its cost-effectiveness.
“I see it as a niche fit for early-stage companies that are looking to target retail investors, without listing on the ASX or NSX,” he says.
The funding round is listed on the Crowd88 platform, which aims to differentiate itself in the market by offering companies exposure to its “cornerstone club” — a network of sophisticated investors who make larger capital contributions as part of the funding process.
Plastech has a minimum funding target of $600,000, up to a maximum of $1.6 million.
Having launched its CSF round, the company is in advanced discussions with a large private investor to tip in an amount which will push it above the minimum target.
“We view this as a combination or sophisticated investors raise, plus a retail component. So for us it provides us with a platform, but it will allows us to do what I would call off-platform marketing and speak with sophisticated directors directly,” Reilly said.
Plastech then plans to deploy the capital largely toward product development in 2019.
“We expect it will take about four months to finalise the engineering,” Barker says. “And we’re producing operating manuals so we can give people an idea of what proportions will give you what physical properties for the plastic substrate.”
The company will then embark on a global search for partners who can manufacture the product. “It’ll be around a three-month process to build the first one. That’ll go through its paces a little bit and then we’re into it,” Barker said.
Plastech’s commercial strategy is based around licensing agreements for its patented technology.
The group is targeting both individual customers who will pay an ongoing fee to operate the PolyWaste machinery, along with master licensing agreements where Plastech receives an up-front fee in return for regional distribution rights for a partner entity.
Once up-and-running, the PolyWaste technology has a production capacity of 3,500 tonnes per annum.
The company wants to change the domestic landscape for plastic recycling among companies and local councils, but it’s also obtained the patents to launch globally.
“We’re able to have really strong patents, because the product is absolutely unique,” Barker said.
Filing individually by country, Plastech has now received patent approval for its product in Australia and New Zealand, China, Japan, the US, UK, European Union and South Africa.
Once the process is complete, Barker says it’s up to the customer how they want to reuse it.
“The melter itself only spits out the molten putty, it’s really what you want to turn that into at the backend of the process.”
(As a mildly amusing test-case, the company used its PolyWaste technology to create furniture for major cigarette companies derived from the plastics in cigarette butts discarded at Crown Casino).
“We’re looking at just supplying the technology so it can be bolted onto existing plastic recycling operations,” Barker said.
“If we can halve the cost of recycling plastic, all of a sudden there’s a whole range of uses it can be put to.”