Sea 2 Sky Inks $757 Million Agreem
Sea 2 Sky Corporation (SSKY) shares jumped more than 60 percent after it obtained a multi-year Wood Fiber Supply Agreement worth more than $757 million in projected sales over the next 15 years based on the current market price of $233/dry ton.
Sea 2 Sky Corporation [[SSKY.OB]], a leading renewable bio-energy company, announced a multi-year Wood Fiber Supple Agreement with Des Wilson Forestry Ltd. of New Zealand. The agreement will allow the company to service the international wood pellet market on a long-term basis with Europe and Asia having substantial multi-billion dollar product requirements.
David Siebenga, President and CEO of Sea 2 Sky Corporation commented, “With this agreement now in place, we have achieved a historic milestone of opening up new markets in the forest industry by harnessing strong international sources of supply in stable democratic states that we can now market to our international network of companies and governments.”
Wood pellets have many uses in both industrial and residential use and are considered to be carbon neutral when burned. Many companies like Novus Energy and RWE AG are substituting biomass for coal in Europe, and the trend is only rising as consumers and governments shift their focus to alternative energies. As a result, the company expects strong results from this deal.
Last quarter, Sea 2 Sky reported no revenues and a narrowed net loss of $9,949 with 128,733,333 shares outstanding. Meanwhile, it reported total assets of $16,179, cash of $9,504, and liabilities of just $2,982. This implies that the company will be all right in the near-term, but may have to raise additional debt or equity funds in the future to continue operations.
In the end, Sea 2 Sky has yet to produce any substantial revenues from its operations. However, this supply agreement should provide it with the raw materials necessary to begin producing its product. Prudent investors may want to wait on the sidelines until the company shows a profit, but speculators appear to be bullish on the company’s future prospects.
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