Firefighters work to fully extinguish a brush fire in Santa Clarita on Sunday. Rick McClure/For the Signal

Santa Clarita-based USEI plugs into California’s cannabis industry

Somewhere in Oregon, sitting on the floor of a warehouse, is a high-tech device tagged for Santa Clarita-based U.S. Energy Initiatives (USEI).

The nearly $200,000 piece of equipment, called an MRX 20L Super-critical CO2 Botanical Extraction Unit, draws the oil from the cannabis plant for use in a variety of products that some scientific and medical studies have shown to reduce inflammation, pain, anxiety and a variety of other physical conditions.

It may as well print money.

“There’s one company in Oregon that started with one machine three years ago,” CEO Anthony Miller told the Santa Clarita Valley Business Journal. “Now they have four machines and they’re making $12 million a year.”

He paused and added, “And that’s in a state one-fifth the size of California.”

With plans to participate in the now-legal recreational cannabis market in California – the largest in the world, with sales projected to reach $7 billion by 2020, according to New Frontier Data – USEI is nearing operation, likely in the Inland Empire, Miller said.

That is, for now, the closest USEI can get to its home base. The Santa Clarita City Council has pledged to permanently ban cannabis-related businesses at some point this year after extending a moratorium to prevent such businesses last November, while other cities across Los Angeles County have yet to finalize local permitting rules.

Anthony Miller

The city of Los Angeles, for example, didn’t even begin accepting applications until Jan. 3 – two days after recreational use of cannabis became legal in the Golden State, giving already permitted dispensaries in nearby West Hollywood and Santa Ana, as well as further away in Palm Springs and San Diego, a head start into the marketplace.

Less than two weeks after legal sales began with the turn of the calendar, the California Department of Finance predicted recreational marijuana sales, based on projected sales of 1 million pounds across the Golden State, would amount to $3.4 billion, according to Live Trading News.

USEI will begin its quest for a share of the profits with a single machine, the MRX 20L, a sleek invention that churns cannabis trim, or the excess snipping of leaves from buds of the plant, to extract a thick, sticky substance that can then be used for a variety of oil-based products from topicals to edibles. The oil is especially potent, the most concentrated form of the cannabis plant’s three products – the flower, the resin and the oil.

“It’s got its track shoes on and it’s ready to run,” Miller said of USEI’s MRX unit, noting that the 20L model is capable of generating $10,000-$15,000 of revenue each day from 9-18 pounds of cannabis.

“It just needs to be plugged in,” he said.

Once that happens, USEI plans to run the machine for 24 hours every day to both maximize its potential and satisfy a heavy demand that already has Miller planning to purchase another MRX unit, and possibly two, in 2018.

“We probably should have bought the 100L (instead of the 20L). The demand is there,” Miller said. “We’re a drop in the ocean. That’s why we have to buy a second unit. I’ve already been told, ‘If you’re producing a great product, they’re coming to you.’”

With MRX technology, which he described as the “best available cannabis extraction device on the planet,” Miller is confident USEI has an “added advantage” in the marketplace and will deliver a product that will develop customer loyalty.

Upon finalization of provisional licensing in the Inland Empire – Miller declined to specify a location, citing ongoing negotiations – USEI will begin operation following a round of on-site training with the MRX unit. A five-person USEI team completed a mandatory training session in December that was focused on learning the MRX technology.

With the Oregon company that has built itself into a multi-million success story as its motivation, USEI sees green in its future.

“I think we can do the same thing,” Miller said. “We’re gonna grind it out. If they can make $12 million in three years, then why can’t we?”

About USEI

  • Mission statement: To develop, market and create products and services for the cannabis marketplace through creating strategic partnerships to address the needs of the legal cannabis sector, including hemp; thus creating shareholder value to the firm.
  • On the web: www.useicannabis.com/web
  • Email: [email protected]

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