Vivakor, Inc. (NASDAQ: VIVK) shot up 90% after it announced the execution of a 10-year purchase agreement with Hot Oil Transport, a leading supplier of asphalt material. Hot Oil, in turn, supplies asphalt materials to a leading supplier of polymerized asphalt materials in Nevada, known as Southwest Liquid Asphalt & Emulsions.
Based on current asphalt materials index prices in Utah, this contract of sale could have a $250 million total value over the life of the agreement, provided Vivakor can operate and ramp up its Vernai site to full capacity. Southwest Liquid Asphalt’s largest customer in the Nevada region is Las Vegas Paving, one of the biggest road construction corporations in the state.
Vivakor’s Chief Executive Officer, Matt Nicosia, said:
We have already produced tonnage of asphaltic cement with our Vernal, Utah RPC and believe that by the end of the year we will have ramped up our infrastructure to include three additional RPCs to operate the site to the level required to fulfill the full amount of material requested by HOT on an annualized basis.
Mr Nicosia claimed that even though this was their first long-term sale agreement for their asphaltic binder, it was a huge milestone for the company. He said they’ve worked closely with Hot Oil to refine their product to meet their demands and specifications.
Hot Oil Transport Manager, Gene Chrisenbery, said:
This long-term contract for Vivakor’s asphaltic binder will help meet this increased demand and thus give us an added benefit of asphaltic binder that is reclaimed from waste and produced in an environmentally conscious manner.
The HOT Manager claimed that demand for this asphaltic binder had been steadily rising as a result of general supply constraints and new governmental infrastructure spending.
Details of the agreement
According to the contract of sale, Vivakor can provide Hot Oil Transport with up to around 50,000 tonnes of ratable asphalt cement materials from its Vernal, Utah facility.
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