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WOODS CROSS, Utah - Sky Quarry Inc. (NASDAQ:SKYQ), currently valued at $15.4 million in market capitalization, announced Wednesday that its wholly owned subsidiary, Foreland Refining Corporation, has launched a crowdfunding offering to support operations at Nevada’s only active crude oil refinery. According to InvestingPro data, the company faces significant financial challenges with negative EBITDA of $8.3 million in the last twelve months.
The Railroad Valley-based Eagle Springs refinery produces diesel, asphalt, vacuum gas oil, and naphtha for mining, industrial, and transportation customers across the Western U.S. According to the company’s statement, Nevada currently imports approximately 86% of its refined fuel. With a current ratio of 0.39, InvestingPro analysis indicates the company’s short-term obligations exceed its liquid assets, highlighting the urgency of this funding initiative.
The crowdfunding campaign aims to finance targeted upgrades to boost production within current permit limits, improve operational efficiency, and prepare for future integration with Sky Quarry’s planned asphalt shingle recycling operations in Utah. Funds will also be used for debt repayment and working capital. Financial metrics from InvestingPro reveal the company’s total debt stands at $11.6 million, with negative free cash flow of $9.6 million in the past year, underscoring the importance of this capital raise.
"While we continue working to bring our asphalt shingle recycling operations online, Foreland is already producing essential petroleum products and generating revenue," said Marcus Laun, Executive Vice President and Co-Founder of Sky Quarry, in the press release.
The offering is being conducted under Regulation Crowdfunding through PicMii Crowdfunding, with securities issued by Foreland Refining Corporation.
Sky Quarry also indicated it is exploring digital asset strategies for future capital raises, expressing support for legislation including the Clarity for Payment Stablecoins Act and the GENIUS Act, which aim to provide regulatory frameworks for digital securities.
The company describes itself as an integrated energy company focused on sustainable resource recovery, with plans to repurpose asphalt shingle waste that would otherwise go to landfills.
Potential investors are advised to review the offering materials, including the Form C and related risk disclosures, before investing, according to the company statement. The stock has seen a 16% gain over the past week, though it remains 83% below its 52-week high of $5.49.
In other recent news, Sky Quarry Inc. has announced several strategic initiatives aimed at enhancing its business operations and financial standing. The company is exploring the establishment of a digital asset treasury as part of its capital allocation strategy. This initiative involves forming an internal working group and engaging industry advisors to potentially invest in digital currencies, stablecoins, and other blockchain-based instruments. Sky Quarry also unveiled a strategic plan for its subsidiary, Foreland Refining Corporation, to boost refinery output. The "Path to Full Production" initiative aims to increase the refinery’s production to an annual peak rate of 800,000 barrels, with current operations at up to 3,600 barrels per day. The plan includes achieving key monthly production milestones and outlines a phased approach with operational, technical, and financial benchmarks. These developments reflect the company’s efforts to enhance its balance sheet and create shareholder value.
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