So why the delay? Delay probably about six months. We went through a value engineering effort that took a little bit of time. to make sure we can execute with the necessary flexibility, including EPC partners that make sure that we have fixed price, fixed time line, execution path for all of our plants. Those plans are standardized with all the experience that we have generated and gathered over the last two decades, I feel very, very good about that. What it allows us to do is build the four plants that we’ve outlined in the next four years, but certainly allow us to above and beyond as opportunities materialize to replicate building those plants as fast as we can with the equity raise that we’ve mentioned. We have the financial flexibility to execute this to execute that and more particularly as we get to self-funding mode by 2027.
Operator: Our next question comes from Jordan Levy from Truist Securities. Please go ahead.
Unidentified Analyst: It’s. Henry on for Jordan. So you spoke earlier to some of the main drivers for the higher expected plant costs following the EPC review process. I’m wondering if you have any kind of — any other color to provide there in terms of the higher cost? And then, what you see in terms of like potential financing-related implications of for that contracted DC route?
Shai Even: So one thing I should also mention in addition to what we’ve said, , is that these plants are bigger, right? There are like 1.1 million tonne plan. There — I mean, Epes is going to be the largest wood pellets client in the world. It certainly compares very well. The capital costs that we’re generating compares well with the different comparisons that we’re seeing in the market. And I think it will set us up extremely well for — to generate those cash flows in the time frame that we have outlined.
Unidentified Analyst: And then in terms of the spot price kind of advantage you talked to with the recent fall well in energy prices. Do you have any more to add to that in terms of the kind of material benefits you expect to see for that in 2023?
Shai Even: Well, Henry, thank you very much for that question. We certainly see — we continue to see the structural short in the market and elevated pricing, right? That will come through in two different forms. One is new contracts that we have signed are in elevated prices. But certainly, some of the market dislocations that we will continue to see will certainly provide incremental opportunities. One of the things I just wanted to say is that we do not expect that prices come back to historical levels. And as you’ve heard us say in the past, 15% to 20% of our supply typically comes from third parties — from third-party purchases. This was certainly a little higher in 2022 from a margin perspective. But as we go into 2023, we expect that to go back to historical levels.
Commercial activity, 15% to 20% is another good proxy for what you should expect as part of the guidance, right? Should the structural short that we see in the market lead to higher prices over the course of 2023, which is not part of our current guidance, you certainly will see us being pushed to the higher end of the guidance and maybe beyond.
Thomas Meth: I would add that as we mentioned on the permits, we do expect to benefit in 2023 with product sales of over 7 million metric tons.
Operator: Next question comes from Pavel Molchanov from Raymond James. Please go ahead.
Pavel Molchanov: Is it fair to say that the equity offering is accelerated from perhaps what you guys were indicating three, six months ago when I think that the messaging was more maybe a year from now or something along those lines?
