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Clean Tech Co. Set To Benefit From 'Forever Chemical' Crackdown

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As the U.S. federal government continues to crackdown on so-called "forever chemicals," one company said its technology could help localities comply with the regulations. One technical analyst is predicting a breakout in the company's stock.

As the U.S. federal government continues its crackdown on so-called "forever chemicals," clean tech company BioLargo Inc. (BLGO:OTCQB) is noting that its treatment systems for removing them can eliminate less waste than other methods, thereby saving clients' money.

After finalizing standards to protect communities from contamination by per- and polyfluoroalkyl substances (PFAS), the EPA announced on April 19 that it would designate two widely used PFAS chemicals as hazardous substances under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), also known as Superfund.

This means that materials containing these chemicals, perfluorooctanoic acid (PFOA) and perfluorooctanesulfonic acid (PFOS), will need to be transported using special protocols.

BioLargo's Aqueous Electrostatic Concentrator (AEC) technology removes more than 99% of PFAS chemicals from water, the company said.

"We believe these and other upcoming regulations create a price advantage for our AEC system over competing sorbent technologies such as carbon filtration," said Tonya Chandler, president of BioLargo Equipment Solutions & Technologies, Inc., which markets the systems. "With less waste generated, we can also offer clients waste handling all the way through to full destruction at our facility."

Analyst Richard Ryan of Oak Ridge Financial increased the firm's target price on the company's stock to US$0.50 per share from US$0.45 per share. He maintained his Buy rating.

Analyst Richard Ryan of Oak Ridge Financial increased the firm's target price on the company's stock to US$0.50 per share from US$0.45 per share. He maintained his Buy rating.

"The recent EPA regulations should help drive investor attention to BioLargo's unique technology offering," Ryan wrote.

"The large emerging market for PFAS removal and BioLargo's growing validation in this opportunity should not be overlooked," he continued.

AEC removes more than 99% of those dangerous substances and has been shown in pilot studies to meet the EPA's tough new specifications for PFAS in drinking water, the company said.

The process separates the compounds in an electrostatic field, forcing them across a proprietary membrane system. The AEC's energy costs are very low, and its waste stream is a fraction of that of traditional carbon or ion exchange systems.

Testing has shown the technology removes the chemicals to a level of "non-detection," or a level at which science can no longer detect them, the company said.

The Catalyst: Taking Earlier Action

Under the new Superfund designation, "entities are required to immediately report releases of PFOA and PFOS that meet or exceed the reportable quantity of one (1) pound within a 24-hour period to the National Response Center, state, tribal, and local emergency responders," the EPA noted in its April 19 release.

Technical Analyst Clive Maund noted BioLargo had been "extremely overbought" after that prediction but said "that volume has died back."

“Designating these chemicals under our Superfund authority will allow EPA to address more contaminated sites, take earlier action, and expedite cleanups, all while ensuring polluters pay for the costs to clean up pollution threatening the health of communities," EPA Administrator Michael S. Regan said.

Federal entities that transfer or sell their property must provide notice about the storage, release, or disposal of the chemicals on the property and guarantee their cleanup, or that cleanup will occur in the future, the EPA said.

The EPA has committed US$9 billion in funding to help communities and water providers address contamination by PFAS and other emerging contaminants," BioLargo noted. "This funding will assist communities and water providers to acquire PFAS monitoring and treatment systems to comply with new regulations."

Millions Affected by Chemicals

PFAS are a group of thousands of synthetic chemicals used in everything from the linings of fast-food boxes and non-stick cookware to fire-fighting foams and other purposes.

Prolonged exposure may be linked to adverse health risks such as cancer, hormonal disruption, and reduced immune system effectiveness, although research is still being conducted. They are called "forever chemicals" because they break down very slowly.

The EPA has noted about 70 million people are exposed to PFAS in U.S. drinking water, but that testing has only checked about one-third of the nation's public water systems. The agency said it is on pace to find over 200 million people exposed, or at least 60% of Americans, not including those who use private wells. There's even a map of PFAS detections across the country.

More than 15,000 PFAS claims have been filed nationwide against DuPont and its spinoffs and 3M, major manufacturers of the substances in the U.S., Time reported. So far, settlements have totaled nearly US$11.5 billion in damages.

'Sizeable Upleg' Expected Soon

Technical Analyst Clive Maund recommended BioLargo in February, predicting a "major bull market" for the stock. On April 19, he noted it had been "extremely overbought" after that prediction but said "that volume has died back."

"That speculative froth has cleared, paving the way for renewed advance, and it is thus most encouraging to see that the Accumulation line has remained strong during the reaction and is even making new highs which is a reliable indication that another sizeable upleg can be expected soon," Maund wrote. "With the price now cornered between the rising parabola and the descending upper rail of the Flag/Pennant channel, an upside breakout looks set to occur soon."

But the news that BioLargo's PFAS solution meets the new drinking water standards is what could drive the stock now, which Maund deemed an "Immediate Strong Buy." 

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BioLargo Inc. (BLGO:OTCQB)

*Share Structure as of 2/20/2024

"The full significance of this is grasped when you understand that until now, drinking water providers were subject to a patchwork of regulations cobbled together in a piecemeal fashion by state and local regulators," Maund wrote. "Now, however, they will be governed in a uniform manner by federal law understood to be coming into effect this month."

Ownership and Share Structure

About 14.6% of BioLargo is owned by insiders and management, according to Yahoo Finance. They include Chief Science Officer Kenneth Code with 8.48%, CEO Dennis Calvert with 3.34%, and Director Jack Strommen with 1.65%, Reuters reported.

About 0.04% is held by the institution First American Trust, Reuters said.

The rest, about 85%, is retail.

Its market cap is US$101.36 million, with about 295.55 million shares outstanding and about 253.42 million free-floating. It trades in a 52-week range of US$0.45 and US$0.15.

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Important Disclosures:

  1. BioLargo Inc. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.
  2. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of BioLargo Inc.
  3. Steve Sobek wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee. They or members of their household own securities of: [COMPANY]. They or members of their household are paid by: [COMPANY]
  4.  This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company. 
  5. This article does not constitute medical advice. Officers, employees and contributors to Streetwise Reports are not licensed medical professionals. Readers should always contact their healthcare professionals for medical advice.

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