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February 16, 2006
Dear Fellow Shareholders:
The number of investors owning shares in our company
has increased over the past few weeks, and management
would like to extend a warm welcome to you, and to say
thanks for your confidence in the future of CSMG Technologies.
We are a small company, but own several patented technologies
that are both potentially very profitable and that should
have strong demand on a worldwide basis. We thought
it appropriate at this time to publish a brief overview
of our renewable energy landfill methane gas extraction
and purification technology what makes it useful and
unique, and where its growth cycle. We will provide
details of our tissue welding/bonding technology in
a future letter.
Renewable Energy -- Landfill
Methane Gas Extraction and Purification
What is landfill gas and why is it important? Methane
gas is created in landfills by the same process as natural
gas found in deep-well drilling: that is by decaying
organic matter. This gas, in its pure form, has the
same high BTU content as any other source of natural
gas. Natural gas production has peaked in the U.S.,
yet demand for this clean-energy source continues to
increase at about 4% per year, boding well for firm
prices over the next decade.
Here are some of the reasons we are very bullish about
our technology:
-
Superior
Technology Over Existing Systems
While there are already a number of methane gas
purification systems operating on landfills in the
U.S. currently, none have been able to produce pipeline
or near pipeline quality gas (generally defined
as 95% pure or better) and remain economically viable
for landfills that produce between 2,000 and 5,000
CFM cubic feet per minute of raw landfill gas. The
CSMG Technologies plant, by contrast, has proven
itself over several decades of operating in the
gas fields of Eastern Europe. The manufacturer of
our patented system is SUMY-FRUNZE, of Ukraine.
Frunze is a 100-year-old company with over 20,000
employees, and is well known for shipping high-quality
refining and oil and gas drilling equipment worldwide.
The value of high BTU landfill gas that is commercially
usable or pipeline-quality gas is almost double
that of medium-BTU gas produced by many competitors,
as it is acceptable for many more power applications.
-
Protected
by U.S. Patent
The unique CO2 removal system uses an absorption/desorption
technology employed in the CSMG plant is fully protected
by an issued U.S. patent, thus making duplication
difficult if not impossible.
-
Exclusive
Rights to Equipment Produced by SUMY-FRUNZE in the
U.S.
Your company has an exclusive North American agent
agreement with Frunze for almost all other Frunze
Oil and gas, refining equipment, pumps and compressors
a further barrier to competition.
-
Higher
Operating Profits from the CSMG System
Our cost to build and install a methane purification
system in the U.S. is lower than that of any domestic
competitor, as our equipment is designed and fabricated
in Ukraine, at very favorable exchange rates. Further,
revenues and profits that can be generated from
production and sale of high BTU methane gas are
about several times that of using the same gas to
generate electricity (which is what most landfill
gas is currently being used for).
Current Status of the CSMG Landfill
Gas Processing System
The company's first facility, in Chastang, Alabama (about
40 miles north of Mobile), is virtually completed and
awaits commissioning. The plant may be viewed on our
website at: www.ctum.com.
The landfill where the plant is located is managed by
Waste Management Corporation, and we have a 10-year
supply contract with Waste to process and deliver the
gas to our site. Management is in final stages of negotiation
with a large industrial plant that is owned by a major
U.S. company to purchase the refined gas over the next
10 years. The gas will be the primary heat/power source
for a large manufacturing plant located nearby. Finally,
the gas reserves from Chastang will actually increase
over time, allowing for additional contracts with other
industrial clients or gas utilities.
Sincerely,
Don Robbins
President and CEO
CSMG Technologies, Inc.
Additional information about CSMG can be found at http://www.ctum.com
or e-mail publicrelations@ctum.com.
An online investor kit containing CSMG press releases,
SEC filings, current Level II price quotes, interactive
Java, stock charts and other useful information for
investors can be found at http://www.hawkassociates.com/csmg
and
http://www.hawkassociates.com/csmg/kit.htm
.
Investors may contact Don Robbins or K. Bruce Jones,
CSMG, at (361) 887-7546, e-mail: publicrelations@ctum.com,
or Frank Hawkins or Julie Marshall, Hawk Associates,
at (305) 451-1888,
e-mail: info@hawkassociates.com.
Safe-Harbor Statement: Under the Private Securities
Litigation Reform Act of 1995. This press release may
contain forward-looking information within the meaning
of Section 21E of the Securities Exchange Act of 1934,
as amended (the Exchange Act), including all statements
that are not statements of historical fact regarding
the intent, belief or current expectations of the company,
its directors or its officers with respect to, among
other things: (i) the companys financing plans; (ii)
trends affecting the companys financial condition or
results of operations; (iii) the companys growth strategy
and operating strategy; and (iv) the declaration and
payment of dividends. The words may, would, will, expect,
estimate, anticipate, believe, intend and similar expressions
and variations thereof are intended to identify forward-looking
statements. Investors are cautioned that any such forward-looking
statements are not guarantees of future performance
and involve risks and uncertainties, many of which are
beyond the companys ability to control, and that actual
results may differ materially from those projected in
the forward-looking statements as a result of various
factors.
CONTACT:
CSMG Technologies, Inc.
Donald S. Robbins, 361-887-7546
President and CEO
or
K. Bruce Jones, 770-955-0409
or
ROI Group Associates, Inc.
Michael Dodge, 212-495-0744
mdodge@roiny.com
or
Bob Giordano, 212-495-0201
Newsletter Archive:
February 16, 2006
August 3, 2006
November 29, 2006
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