Update: CO2 Tech Ltd. - Like a Virgin?

The hype has faded, and so has the price of CO2 Tech Ltd. (Pink Sheets: CTTD) shares.  The Company's stock, which was trading at around $0.50 a share when we first wrote about CO2 Tech on February 8, 2007, has declined steadily since that time, plummeting to $0.15 a share.  See, CO2 Tech Ltd. - Buy These Shares, Save The World?  Trading volume has declined as well, plunging from the breathtaking 5 million, 6 million and 12 million share a day levels of late January and early February, to less than 26,000 shares on April 16, 2007. 

But CO2 continues to issue press releases – and to drop intriguing names that could be capturing the attention of hungry investors.  On February 12, 2007, for example, the Company made a two-pronged announcement.  First, the Company said that it had "approached several renown (sic) scientists," including a Columbia University scientist, to jointly develop air cleaning products.  CO2 Tech did not say whether any of the academics had enrolled for this cause. 

Then –and this was the true headline grabber - CO2 proclaimed that it was "considering" submitting a proposal for a new $25 million fund formed by billionaire and Virgin empire founder Richard Branson and former Vice-President Al Gore to combat global warming.  The Company suggested that it might seek to incorporate its own research on airplane emissions with a technology developed by the Columbia scientist who had been approached for a joint-venture – although the scientist's research remains in the planning stages.

There was no information in the press release that would suggest CO2 had better odds at winning a Branson grant than walking off with the grand prize in a lottery.  Still, the sexy headline was enough for one promoter.  On February 13, 2007, SmallCap Sentinel issued its own press release noting CO2's "possible" Branson submission.

CO2 has made additional announcements this past month.  On February 12^th, the Company revealed that it had been awarded a contract to help the government of Romania outline a compliance program to reduce specific greenhouse gas emissions.  Although the Company claimed it would be helping the Romanian government comply with the Kyoto protocol and the United Nations Framework on Climate Change, the February 12^th press release did not reveal any terms of the "contract."  CO2 did not indicate how – or whether – it would be compensated for its efforts or the length of the project. 

Since CO2 does not file financial statements wither with the SEC or Pink Sheets, investors cannot determine whether the Company has any assets, revenues, employees – or the wherewithal to conduct the research and render the services promised in these press releases.  Revenues would appear to be even more problematic in view of one of the Company's other recent pronouncements.  On February 14, 2007, CO2 Tech announced that, in order to promote environmental concerns, it would offer its monitoring and assessment services to major corporations at no charge.  CO2 says that it helps organizations monitor and reduce carbon emissions from their operations. 

In making this announcement, the Company said that it was responding to "the growing call of investors and the public to demonstrate compliance with carbon emission standards and initiate corporate programs to reduce global warming."  The Company did not explain why "major corporations" – presumably with large compliance budgets – had been chosen as the potential beneficiaries of these free services.  Nor did it state whether any "major corporations" had accepted the generous offer.

Two more recent press releases have highlighted CO2 Tech's development plans – but leave lingering questions about the Company's finances.  On March 8, 2007, the Company stated that it had begun development of "a new interface for its combined aqueous and vapor-phase carbon adsorption software application that operates under Microsoft Windows(r) environment."  The Company explained that carbon adsorption is a pollution abatement technology. 

Most recently, on March 15, 2007, CO2 issued a press release stating that it was working on development of "cost-effective heavy-duty evaporator units which will be designed for wastewater treatment in utilities, chemical processes, pulp and paper and other industries with zero liquid discharge requirements."

Although the March 8th and 15^th press releases disclosed ambitious projects that would require five to eight months to develop, the Company did not reveal the contemplated costs of the programs or say whether it had sufficient capital for that purpose. 

Can the Company afford these extensive development programs?  If trading volume is any indicator, fewer investors are persuaded that CO2 is poised for success.

Then again, it only takes a few promoters to oil the hype machine.

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