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PHASIS INVEST, LLC

PHASIS INVEST, LLC

Ecologically friendly new crude oil refinery - under one umbrella in Southern Caucasus countries, namely Georgia.

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Deal Type

Equity

Funding Goal

$10,000,000

Current Reservations

$70,000

Minimum Reservation

$5,000

Maximum Reservation

$1,000,000

Deal Stage

Seed

Pre-money Valuation

$20,000,000

Open Date

11/29/2019

Closing Date

02/01/2020

Elevator Pitch

Phasis intends to raise finances to construct refinery with capacity up to 4.2 m tons of light crude oil/year in the Poti region of Georgia. Refinery will have a “Iso-Theming” hydrotreatment unit.

KPIs

16.44% ROI

Company Overview

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Project Summary:

The company intends to raise the needed finances for working capital to construct a refinery with a capacity to process up to 4.2 million tons of light crude oil per year in the Poti region of Georgia.

The refinery will have a “IsoTheming” hydrotreatment unit (licensor DuPont), fixed bed catalyst hydrocracking (licensor DuPont) and light fraction shift units to produce EURO 5 high-octane gasoline and diesel fuel as well as LPG and electricity.

DuPont’s latest technology rise refinery efficiency up to 96% and gives a significant competitive advantage to our company among all the competitors in the region.

Capital Discipline for the development/construction of a Light Oil Crude Refinery in the City of Kulevi in the State of Georgia.

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The company’s project implementation process requires the development of three (3) stages before final approval is granted to start construction:

These are:

Stage I – Opportunity Identification

Stage II – Conceptual Project

Stage III - Basic Project

At the end of each stage, as the maturity level of project information increases, a decision gate will confirm the project’s viability and whether it adds value to the company’s portfolio. The project will then compete with other projects for the necessary resources to advance to the next stage.

Stage IV, when investments are effectively contracted, will only be initiated if the project’s technical feasibility and economic viability has been confirmed (Stage 3 approval).

There is an exception for oil exploration & production projects in Georgia, which may receive necessary resources in advance of Stage 3 approval, if it is determined such resources will accelerate oil production.

The portfolio analysis of the Phasis Business Plan did not lead to the cancelation of projects. The Plan’s physical targets will be achieved by managing the portfolio, which is now classified into the following groups:

Project scope:

The construction project is comprised of the following:

  • 4.2 Mt pa (33,000,000 barrels per annum) refinery construction;
  • 3-berth pier construction to receive up to “Aframax” class vessels (120,000DWT);
  • Railroad terminal construction for 72 rail cisterns;
  • Storage farm of 440,000 m3 construction;
  • 50 MWatt power station construction; Hydrogen generating plant construction;

Phasis Group is a middle sized scale but standard and licensed crude oil refinery business that will be based in Light Oil Crude Refinery in the City of Kulevi in the State of Georgia.

Although we intend to start out on a small scale, that will not in any way stop us from maximizing our potential in the international crude oil industry. We hope to grow the business so as to start exporting refined crude oil products from the Georgia to other neighboring countries.

Our business goal as a standard and licensed crude oil refinery business is to become one of the leading oil and gas companies in Georgia.

Our business activities will involve: gasoline production, kerosene production, distillate fuel oil (diesel fuel) production, aviation fuel production, residual fuel oil production, lubricant production, producing aliphatic and aromatic chemicals as byproducts, diesel fuel oil, jet fuel, liquefied petroleum gases, residual fuel oil, and other refined petroleum products. We have been able to secure permits from all relevant departments in the State of Georgia to run the business.

However, upon the company’s growth, we would like to serve the Georgia, Armenia, Turkey and Ukraine market. Being an animated visionary, a success-inclined personality, a passion-driven human, and a result-motivated individual, Mr. Rolf Gruenhut was propelled to found and manage PHASIS INVEST LLC. Consequently, he engenders diligence, the significance of individual power and collective efforts, resoluteness and passion for excellence, and will be of immense benefit to the growth and sustainability of the organization.

Free Industrial Zones in Kulevi and Kutaisi:

Many foreign investors find Georgian Free Industrial Zones (FIZ) very attractive.

These are special territories with a lower tax burden often referred to as tax havens.

Both legal entities and private entrepreneurs registered in a FIZ pay almost nothing in taxes on the condition that they export their produce to other countries.

Another valuable merit such zones have is the provision for duty free trade with China, the EU and the CIS countries as well as those bordering Georgia.

Thanks to this, goods marked “Made in Georgia” are highly competitive in many foreign markets.

What else attracts investors to such Free Industrial Zones as those in Kulevi and Kutaisi?

The Kulevi Free Industrial Zone:

The youngest of all Georgian FIZ is the one located near Kulevi settlement in Khobski region in the west of Georgia. The Georgian government has allocated 599 790 square meters (717 343 sq. yards) for this Zone, and it is to be in operation under the current conditions for 99 years.

Even though the government decision to establish this FIZ was made in 2012, the Zone was put into operation only in September 2017. This delay was caused by the change of the Zone management. In the beginning SOCAR Georgia Investments, Ltd. (Azerbaijan) was appointed managing company. It is a subsidiary of the Azerbaijani state oil company who had planned to invest over several years at least $700 million USD into the construction of a carbamide production plant (carbamide is a nitrogen fertilizer).

At the time the memorandum was signed, SOCAR was the main supplier of oil, oil products, and natural gas to Georgia. It had invested over $1 billion USD into different projects in this country. Besides, SOCAR owned an oil terminal in Kulevi.

The start of the FIZ operations was postponed several times, first until September 1, 2014, then until September 1, 2016.

This delay occurred due to transition of the company to a new owner, Phasis Oil LLC (a subsidiary of Streamtrade SA, Switzerland).

The initial construction plan also changed: the carbamide production plant construction was terminated in 2015, and the construction of a petroleum refinery – the first one in Georgia – was started on this territory in 2018.

The expected refinery production capacity is 4 million tons, 500 tons of refined oil per day. In addition to the refinery, a natural gas reservoir and a thermal power station will be built. The estimated overall cost of the project is $1 billion USD.

Apart from constructing the plants, the FIZ administration is obliged to make it fit for conducting business activities there. This includes building the infrastructure, putting customs offices in place and providing all that is necessary for customs control, erecting office buildings and equipping the offices with furniture and clerical aids, and bringing the utilities. The existing infrastructure is meant to suit the companies connected with oil refinery in some way.

Traction

  • Raising of $6.0 Million US Dollar - the second goal.

    December, 2019
  • Establishing of Phasis Oil Swiss Limited

    November, 2019
  • Start: Raising of $4.0 Million US Dollar - the first goal.

    October, 2019
  • September 2019: Get the Feasibility Study from Deloitte Touche for the Development of the Light Crude Oil Refinery.

    September, 2019
  • September 2019: Get the Final Business Plan from Shell for the Development of the Light Crude Oil Refinery.

    September, 2019
  • September 2019: Establishing of the Crowdfunder Campaign Page.

    September, 2019

Pitch Deck

Press Mentions

Key Customers & Partners

Fin Med AG. Chilenholzstrasse 34b, CH-8907 We Phasis Oil LLC, Georgia Tecnicas Reunidas, Oil & Energy, Madrid / Spa Royal Dutch Shell plc, London / U.K.

Testimonials

Stefan Schaerli
Stefan Schaerli
Banker
"It never came to complaints and Mr. Gruenhut always carried out his activities correctly. After leaving the AG Kantonalbank I still advise Mr. Gruenhut privately."
Grzegorz Koprowski
Grzegorz Koprowski
CEO at Bionik Ltd., PL 02-365 Warszawa, Polan
"We worked with Mr. R. Gruenhut since 20 years when he was the CEO of Printoplast AG, then the CEO of PP Hightech AG and recently the CEO of Fin Med AG. Mr. Gruenhut provided our company high technologies especially in the field of contactless identification, RFID technologies and biometrics, which were then delivered to third parties, mainly ICT system integrators in Central and Eastern Europe. One of the major ICT integrator was Emax in Poland, for which we provided Mifare cards for Automatic Fare Collec "

Previous Funding

  • $7,000,000 Equity
  • Raise Source: Self
  • April 2019

Frequently Asked Questions

1). What are the different categories of Oil found worldwide?

There are about 161 different types of Oil found worldwide. The different categories of Oil found worldwide is classified into different types of crude oil like Brent, Dubai Crude, West Texas, Intermediate, etc. Classification is done according to their sulphur content.

2). On what basis Crude Oil prices are determined?

Crude oil is a commodity, and the prices depend on the demand and supply.

3). Would you be able to recruit investors from your existing network?

Equity Crowdfunding platforms like Crowdfunder can be a great way to market our product and gain a new audience. However, it’s best not to solely rely on the crowdfunding platform you go with and their investor base to hit your funding round’s target. It’s worth noting that your own, existing customer base can often make the best brand evangelists and they can simultaneously provide validation for your product or service offering.

4). Are you prepared for the administration involved with a raise?

Raising funds via a crowdfunding round can be rewarding – as you raise capital and awareness simultaneously. Yes, it requires organization and focus. In fact, it’s usually best to have a dedicated person to ‘own’ your campaign and all the associated activities it involves.

5). Could you keep potential investors updated throughout the raise?

To further fuel the interest in our raise, seize on every opportunity to put the spotlight on any of our new products or services we are developing, any landmarks we reach throughout the campaign and any mentions we get in the press.

Risks & Disclosures

What are some of the risks involved in investing?

Please be sure to carefully review the Risk Disclosures. The following section is excerpted from that lengthier document.

Some of the key risks to know before you invest in startups:

Crowdfunding investments are highly risky and speculative. You should do your own research and scrutinize all disclosed risk factors before making an investment decision. The following are some of the key risks applicable to Republic offerings:

Speculative: Investments in startups and early-stage ventures are speculative and these enterprises often fail. Unlike an investment in a mature business where there is a track record of revenue and income, the success of a startup or early-stage venture often relies on the development of a new product or

service that may or may not find a market. You should be prepared to lose your entire investment.

Illiquidity: Your ability to resell your investment in the first year will be restricted with narrow exceptions. You may need to hold your investment for an indefinite period of time. Unlike investing in companies listed on a stock exchange where you can quickly and easily trade securities, you may have to locate an interested private buyer when you do seek to resell your crowdfunded investment.

No voting rights: A Crowdfunding Investment does not provide voting rights to its holder, unless and until the Crowdfunding Investment or the note is converted into an equity stake. If and when you receive voting shares in a company, your voting rights will likely be diluted when the company raises additional funds.

Cancellation restrictions: Once you make an investment in a crowdfunding offering, you can cancel the investment at any time and for any reason up to 48 hours before the offering deadline.

Valuation and capitalization: Unlike listed companies that are valued publicly through market-driven stock prices, the valuation of private companies, especially startups, is difficult. You risk overpaying for the equity stake you receive. The class of equity being sold via a crowdfunding offering may have fewer rights than other equity classes issued by a company.

Limited disclosure: The company must disclose information about itself, its business plan, the offering, and its anticipated use of proceeds, among other things. An early-stage company may be able to provide only limited information about its business plan and operations because it does not have fully developed operations or a long history to provide more disclosure. The company is also only obligated to file information regarding its business annually, including financial statements.

Under certain circumstances the company may cease to publish annual reports and holders of the Crowd SAFE will have no information rights.

Investment in personnel: An early-stage investment is also an investment in the founding entrepreneur(s) and/or management of the company. Being able to execute on the business plan is often an important factor determining whether the business will be viable and successful. You should also be aware that a portion of your investment may fund the compensation of the company’s employees, including its management. You should carefully review any disclosure regarding the company’s use of proceeds.

Possibility of fraud: As with other investments, there is no guarantee that crowdfunding investments will be immune from fraud.

Lack of professional guidance: Many successful companies partially attribute their early success to the guidance of professional early-stage investors (e.g. angel investors and venture capital firms). These investors often negotiate for seats on the company’s board of directors and play an important role through their resources, contacts and experience in assisting early-stage companies in executing on their business plans. An early-stage company primarily financed through crowdfunding may not have the benefit of such professional investors.

Documents

Confidential

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