Finished BOOST contract should bring in recurring revenue stream going forward.
Late last year TRIT won Boost contract. The key word is proceeds. It means they will collect revenue every day, month and years for 30 years. I dont know how much it is worth per year. But based upon previous BOOST contract models from other companies range from $3 million to $20 million dollars a year. Even if its low end between $1 million to $3 million is huge revenue stream. Hopefull they will disclose or provide more information at the next conference call.
November 29, 2011
Tri-Tech (Beijing) Co. Ltd. (Tri-Tech Beijing), was awarded a concession build-own-operate-subsidy-transfer (BOOST) municipal infrastructure project from Buerjin County Government in Xinjiang Uygur Autonomous Region (Xinjiang). The scope of the project covers construction and operation of the water treatment and water supply systems, as well as wastewater collection and treatment systems for Yelaman Township in Buerjin County. Tri-Tech's total investment in the project is expected to be approximately $3.15 million. Tri-Tech Beijing's majority-owned subsidiary will own and operate all assets for up to 30 years.
To invest, build and operate the project, Tri-Tech Beijing established Buerjin Tri-Tech Industrial Co. Ltd. (Tri-Tech Buerjin), a joint venture with the Buerjin government in which Tri-Tech Beijing holds 80% of its equity, the Buerjin county government holds 10% of its equity, and an unrelated third party holds the remaining 10% of its equity. Upon the completion of construction, Tri-Tech Buerjin is entitled to all assets of the project and proceeds from independently operating the systems and facilities associated with the project for up to 30 years under a concession agreement. In addition, Buerjin's government is expected to award Tri-Tech Buerjin a monetary subsidy of 60% to 65% of its committed investment for construction of the project. Tri-Tech Buerjin is required to forfeit its rights to all project-related assets to Buerjin government when the 30-year concession period expires.
Mr. Gavin Cheng, President of Tri-Tech Holding said: "The Yelaman project is our first BOOST municipal infrastructure project. BOOST projects offer an exciting opportunity to our company, because we are able to receive substantial subsidies to reduce the cost to build the project. We expect that the project will be completed by October 2012. Once the project is built, we will then be able to operate the municipal water supply and sewerage systems for the next thirty years. The BOOST model lets us participate in the long-term upside presented by equity ownership in the project and a 30 year operating relationship. Tri-Tech's experience in the industry allows it to provide advanced technologies, leading engineering and experienced personnel to maximize operating stability of the project and maintain project-related assets. We believe this BOOST project will help to strengthen our competitiveness and raise our visibility in the market."