Afternoon, everyone. Appreciate the opportunity to talk to you all today about Perma-Fix. Thank you to Gabelli Funds for hosting us again this year. Anxious to talk about where things are going with Perma-Fix and how things have changed over the last year and how our growth initiatives are setting us up for a really good-looking 2026 and 2027. Introduce you to the company if you're not familiar with us. Our company is broken into two different segments. One is waste treatment. We have a number of waste treatment plants I'll talk about in a minute and some technologies that go with each one of those. The other half of the company is our services segment. Basically, the way we look at it is if we are doing work in our treatment plants around the U.S., that's a waste treatment revenue.
If we're doing things in the field, such as remediation or demolition or processing waste in the field, that's our services group. We've seen a little bit of a dip in 2024 in the services group, which was somewhat anticipated based on the procurement cycles that we're in. We're seeing that those revenue potentials increase here recently. We've also seen some increases in the treatment segment as well. We have a very senior management team, everyone with at least 30 years' experience in this business. Most of the company are at least eight or nine years and some closer to 20, 30. Louis Centofanti, there in the middle, is our founder. He's a PhD chemist.
He has come up with many of the different treatment technologies that we have today, about 40 different patents, and is a big part of our strategic growth plan and continues to generate new technologies that are generating revenue. Our primary market overview, we have a large dependence on the Department of Energy. The Department of Energy is responsible for most of the nuclear waste cleanup efforts in the country. There is about an $8 billion, a little over $8 billion a year in the last several years of budget cycles associated specifically with cleaning up radioactive waste. We get a good bit of our revenue, about 50-60% from that budget cycle or budget segment. Also, we get an additional amount from the weapons program within the Department of Energy. That is what we call the National Nuclear Security Administration, NNSA.
They are responsible for maintaining and developing the arsenal that we've got now, which are largely just a couple of different sites that generate pretty sustainable waste streams as well. Also getting waste from the Navy, but in addition to that, from nuclear propulsion waste, we also are doing ship decommissioning in our services segment where we take ships that have been in the nuclear arena for quite some time, are going through decommissioning. We have the expertise to decommission those, clean them up, put them in a position where they can be free- released or scrapped or used for targets and removed from the maintenance arsenal that they have. Also seeing real growth right now in commercial segments, particularly in oil and gas, fracking, which most people don't realize generates quite a bit of radioactive waste.
When you frack, you insert or inject tens of millions of gallons of water into the subsurface that goes through many different layers of radioactive shales. When that water comes up, you take out all the solids and you have a waste stream that frequently has over-regulatory limits for radioactive materials. We treat those, and we're seeing a big increase right now in those receipts as well. Also doing very well in Europe. The technologies that we've developed are not in Europe, and we are deploying those over there, including—oh, excuse me—we're actually using our technologies in this country to ship their waste to us, their waste to us. We treat it, which usually means incineration or some other form of treatment, and then we send it back. We don't have to worry about tariffs here.
Basically, it comes over here, it goes back, and it's a service. What that offers our friends in the other countries is that we reduce volumes by about 90%. Most of their long-term strategy for waste internationally is storage. If they can get their waste reduced to 90% at a reasonable price, that allows them to store more. Our four plants is what really distinguishes us. They're very unique plants with very, very difficult permits to attain. Some of these permits could never be duplicated. For example, at our biggest facility, the Northwest facility in Richland, Washington, which is where the Hanford site is, we have a set of incinerators that incinerates radioactive waste. There's really nothing like it worldwide. We do most of our international work here as well. We also support the Hanford site.
The Hanford site is far and away the largest single facility within the Department of Energy or the government in regards to liability, with a liability of about $600 billion just to clean it up in the next 100 years or so. We also have a facility just outside of Oak Ridge, Tennessee, in Kingston, Tennessee. That also has an incinerator to incinerate liquid radioactive waste, which is something that no one else has as well. The Florida facility has a couple of new technologies as well. That was our initial facility. We've also put our first PFAS unit in Gainesville. The last facility we just attained here recently, which is in Oak Ridge, Tennessee, where I'm located, is the EWOC facility. EWOC is a facility we're also deploying a new PFAS unit.
We also do a lot of other rudimentary waste treatment technologies there, including sorting out waste that are radioactive and a number of other lower technology types of activities. Okay, we have five growth initiatives that really have been in development for the last five to ten years. I want to go through each one of those in detail and kind of show you how we're seeing our path to a $200 million a year revenue growth is looking like it's coming into clear vision. It begins with our larger bids. We have a business base right now we try to focus on, which is about $80 million a year. We're a little bit—oh, excuse me—yeah, $80 million a year, about $20 million a quarter.
We've been falling a little bit short of that recently and closer to $15 million-$14 million a quarter range due to procurement cycles as such that just haven't had the opportunities in the services segment to put proposals together and respond to bids. That has been changing the last couple of months. We're seeing that activity increase dramatically. We are used to doing six to eight proposals a month. We've been doing one or two up until the first quarter of this year. We're starting to see some real movement there. We were selected for a $3 billion job up in West Valley, New York, just up the road here near Buffalo. We're with a larger team. BWXT is the company that won, and they have an LLC with several other large firms, Amentum and Geosyntec. We're their primary small business on the team.
We're what we call a teaming subcontractor. We're basically responsible for most of the waste management associated with the cleanup of the West Valley facility for the next 10 years. We're just in the process of transitioning. Right now, the transition runs through June 24. At that point in time, we'll take over June 25 and be operating the facility for at least 10 years. We're still in the process of defining what our revenue is going to be based on the scope of work that we're negotiating with the Department of Energy. It is looking very good for the types of work that we provide.
Also, several other projects I mentioned at Lawrence Livermore National Lab in the Bay Area, along with Berkeley Lab in the Bay Area, and several others within DOD that we're bidding on that are coming up here or are underway as we speak. We also submitted a very important bid for the USS Enterprise with another larger firm. Again, we're a small business. This is about a $500 million job to decommission the USS Enterprise aircraft carrier that had eight reactors on it. Our job will be to decontaminate the areas around the reactors so they can scrap the entire ship. That is set to be announced for award here in late Q2. We're hopeful. They're obviously a very competitive bid, but only really one or two other competitors will be in that race. Our second area of growth is the upgrades to our plant facilities.
Each plant we have has a strategy for broadening its TAM based on what waste are generated in the market right now, which change all the time based on what different organizations are doing from the nuclear power industry to the Department of Energy and DOD. Those things change. We find more difficult waste that don't have what we call orphan waste that don't have places that can be treated. You just have to stay in storage, and we can make the investments to provide technologies to solve that problem and get rid of them. We are in the process of upgrading these plants from our last capital raise that we just did in December.
That opens up the market for significant chunks of revenue for us, several $20 million different streams that we're working with in a classified area, classified waste at our DSSI facility in Kingston, along with our facility in Florida that also has some capabilities that we're broadening in association with thermal treatment of different types of NORM sludges, what sludges you get from the fracking industry, as I mentioned. In our last facility, our bigger one, we're making several upgrades to support upcoming waste streams that are on their way there with the startup of some new facilities at Hanford, which I'll talk about in a minute. Basically making capital upgrades to each one of these plants to broaden the potential revenue we can get through these facilities based on where the market's leading. Hanford really is the big one for us, though.
Hanford is where, if you've seen the movie Oppenheimer or any other number of movies, that's where they made the plutonium in the mid-1940s and onward. If you've ever been to Hanford or heard of Hanford, what Hanford has been doing since the initial weapons program is when they get liquid waste, they put them in underground storage tanks. Basically what they've been doing over all those decades is as tanks get full, they draw down the liquids out of those tanks through what they call evaporation, put dry materials back in. Most of these tanks are dry, some are peanut butter-like, but they've got 177 of them now, about 59 million gallons or so. Very, very radioactive, very difficult to deal with. Several of those tanks are leaking right straight down and coming close to the groundwater.
It is certainly by far the Department of Energy's and the government's largest single liability from an environmental perspective. DOE in the 2000 timeframe decided, okay, the tanks are a big deal. We got to build a facility that can treat the liquids and the tank waste out of there. They will add water into them, make a slurry out of it, pull it out, send it to a plant that they have been building for 25 years. It costs about $15 billion. The name of that plant is the DFLAW Plant, the Direct Feed Low-Activity Waste Plant. In that plant, as it was rolling along, they decided this thing is getting so expensive, we are just going to commercialize all of the waste that comes out of the plant. As they pump waste out of the tanks, it goes into DFLAW.
What they do in DFLAW, it's quite interesting, they mix it with glass beads. What comes out is a big log of glass, which is a very, very stable waste form in this industry. It doesn't get any better than that. You can put that glass in a landfill. It never leaches out, never contaminates anything. It's really fantastic as far as long-term viability of the waste and protection of the waste goes. It's very, very expensive. What people didn't realize when they were doing this design is when they make that log and they add a gallon of water from that tank into that system, they generate three gallons coming out. They make a really nice log that they can put in the landfill, but they generate three waste streams coming out.
They decided what they would do because this plant got so expensive is they decided, let's just commercialize all the waste coming out of the plant. We'll send it out to a commercial area of treatment facilities and let them make it go away. There's only one of those facilities in the Hanford area, and that's our facility. It's right 1.2 miles away from the fence of the Hanford facility. They signed a document here called a Record of Decision in a 2023 timeframe. It basically said very clearly in that document, all of the waste that comes out of DFLAW, once it starts, will go to Perma-Fix Northwest. We estimate that to be about 8,000 cubic meters a year. A very dramatic amount of waste. In terms of revenue, that's about $70 million a year in waste generation itself.
That plant is part of an agreement that says up top there are holistic negotiation. That basically is fancy for some legally binding milestones that the government has signed up for. That plant is to start based on those agreements on August 1 of this year. Once that starts, we'll start to see that revenue come in a couple of million dollars a month and get close to $6 million-$7 million a month here through the next year. That grouting plant I talked about, excuse me, that vitrification plant at DFLAW that I talked about will only address about 40% of the underground storage tanks that I mentioned that are at Hanford. The other half, other 40% of it, they've decided because it's in a different location, they're going to grout them.
What that means is they're going to pump that waste out and they're going to send it to a commercial facility. Those facilities will mix it with basically a type of cement, fancy, expensive type of cement, make a big box out of it, and then it can go out to a commercial landfill somewhere and be disposed of. That is something else that we've been doing for the site for Hanford for many years. We have the permits to do that right now. They'll be generating 3 million gallons a year at roughly $50-$100 a gallon in the next several years. That is a little bit farther behind. I think the DFLAW plant is pretty solid in regards to funding.
Grouting is more susceptible based on cuts and things because it's still a few years out, but the DFLAW is on track for August 1. International growth, as I mentioned, we did win a EUR 50 million project out of Italy to take some bituminized waste out of Ispra, Italy, which is up north, right near the base of the Alps. We're right in the process right now of finishing our documentation, getting ready to start exhuming that waste. We'll pull that out with our partnership with a local company called Campo Verde. We have a 50/50 JV with them. They pull it out. We ship it to ourselves in Richland, Washington, incinerate it, and send back what's left over for them to store. That's off and running for about a year now.
Revenue hasn't really seen a significant impact because it's kind of document development, but we'll start to see some good revenue on that in the 2026 timeframe. We're also working with a partner in Europe right now to build a facility in Europe, in the U.K., and duplicating our facility that we have up in Washington State, the incinerator I mentioned over there, to really provide a much more efficient operation as opposed to shipping waste across the pond all the time. That will support several new clients that we have in the European Union, particularly Germany, as they're decommissioning their fleet of reactors, as well as several other clients in the power industry around Europe. Okay, PFAS is number five. PFAS has been a big initiative for us. We're putting a lot of effort, a lot of our top talent on PFAS.
We've been working on this for several years. I'm assuming people know what it is. I won't spend a lot of time talking about it. As defined by Barron's, it's about a $200 billion market. It's just beginning to pick up. Our technology is a lot different than anybody else's. Everyone's got a different twist on technology. The reason we're so confident in ours, I'm just going to cut straight to the most important thing, is that ours is very economical. We can run it very inexpensively because we don't need a lot of heat. We only take our reactor that we put the PFAS in up to about 150 degrees Celsius as opposed to some of our competitors. We've just completed in October our first prototype facility. We went through bench- scale testing and pilot- scale testing.
Our initial prototype will do about 650 gallons a day per shift. We're still tuning it and getting it just right from an engineering perspective. The technology works great. It does what we call six nines of destruction. In other words, it goes away to the point that we could either deep well inject it or we can put it in a landfill. We are working on our second unit. That's another reason for our capital raise recently. Our second unit will do about three times that, about 2,000 gallons a shift. We are building up our backlog now with partnerships with generators and other companies to begin to support that in the Q4 timeframe, early Q4. That will be located, as I mentioned, in the Oak Ridge facility. Also taking this exact technology, which is largely chemistry-based, there's no stack. Basically, everything's in a closed loop.
We can also apply that to soils as well as to GAC, which is also a very growing market right now, or activated carbon market, as well as leachates from wastewater treatment plants in landfills. It's a very exciting deal for us. We're just starting to really see the revenue now pick up as we get to more of an operational stage with our prototype unit. Once our new unit gets installed in September, we will be off and running with a lot of other units. As I mentioned, we did have a rough 2024. We predicted we would, based on, as I mentioned, the investments we're making in PFAS and putting our top folks on it, as well as the procurement cycle on the services side. We are seeing that recover through March, particularly. We will see the continuing recovery through this quarter.
With DFLAW coming into play here, hopefully as scheduled by DOE for the summer, we'll have to see the West Valley program also be kicking off really in the summer and PFAS going in Q3 and a few other proposals we're witnessing here on. We're looking for a significant increase in revenue here the latter half of the year. Between each segment, they're kind of completely different in regards to how we account for margins. On the treatment segment, we have a lot of fixed costs in keeping these plants compliant, keeping all the trained people there. But once we get over a certain revenue base, we start to see margins dramatically increase, which is kind of designated by the graphic on the left. On the right side, the services segment is just the opposite.
We move staff up and down depending on how much work we have, how much backlog we have. We have gone down pretty low here to try to cut costs as much as we can to address the reduction in revenue that we've been seeing in the last couple of months, couple of quarters. This graphic here is just to show you how things scale in regards to our revenue increases. If you're looking across the top here at $100 million-$200 million, how the impact of EBITDA goes up non-linearly in regards to covering our fixed costs and putting us in a position of real growth in the next couple of years. Okay, just to recap, again, 2024 was rough for us. We made it through okay. Now we're on to some very exciting times for us.
We're seeing several different things increase in regards to revenue generation opportunities with very limited anticipated impact by the change of administrations under President Trump. Obviously, we don't know everything that's going to happen. In regards to the nuclear waste world, most of this is driven by regulatory milestones and commitments, as well as safety. We do see the potential for some of these procurements maybe to get delayed, some that we're waiting on, but we still have a very strong backlog of opportunities in our pipeline, as well as wins that we see coming irrespective of those headwinds. That's West Valley, the PFAS, and the European markets as well. Okay, I think that's pretty much it for where we are today. Thank you.
Perfect. Yeah, if you want to, feel free to take a seat.
Just want to briefly turn to the audience in case there's any questions there. Yes.
Given the changes in the way the administration is going about downsizing, has DOE, any of their representatives from Chris Wright on down, given you any sense of the disruptions that may occur to your business?
There really is no. We've had meetings, several meetings actually, and it's meetings next week specifically with the new administration. We have not seen any impacts yet. I think from what I understand, the real impacts we will see will come in the 2026 budget. From a philosophical perspective, the focus on commercialization has been mentioned several times and reducing on-site staff.
There's definitely been a big shift in focusing on how many jobs are created versus focusing on performance-based contracts and performance-based milestones, which include, particularly at Hanford, the contractor being incentivized, the site contractor being incentivized for every gallon of waste they dispose of. That's exactly what we want to see in contracts. If a contractor is motivated to move waste when things happen, for example, this just happened a couple of days ago or weeks ago, when their systems went down that treats waste, they call us, we pick up the waste and keep things moving. That is driven heavily by performance-based contracting. That's what we want to see. That's what this administration brought to the forefront last time as well. We're excited about that, not excited to see what's going to happen in the 2026 budget.
No one really knows at this point what they're thinking.
Just wait for the mics to come on the way here.
Oh yeah, just to follow up on another aspect of your business, the PFAS, maybe Ben could answer this, the investment in PFAS, is it expected to give us a payoff at any point in the next year?
Yeah, how's that? Okay. Yeah, it'll have not, I guess when you count a year starting when we start to see material revenue, which is kind of early Q3 over a 12-month period, yeah, we expect it. It's like our other waste streams. We're seeing very high incremental margins. And we believe most of our current staffing can handle it. It might need one or two people to run a unit. For the most part, it's set up at our two existing plants.
We don't see much incremental fixed, and we see a pretty aggressive variable margin. Yes, we think our expectations are for a first-year return and a pretty profitable venture overall.
Do you see more of an opportunity in SMRs and thorium-based nuclear reactors?
You know, I wish we could say we see an opportunity there. We're very tuned, and actually, it's very lucky to be located in Oak Ridge, Tennessee. Oak Ridge has got one of the first sited areas, units for an SMR facility through TVA and Kairos Power. Also, Orano has just announced that they're building a centrifuge plant there for enrichment. To answer your question, it's been very difficult to really pin down what the waste generation process will be and whether it'll be suspended fuel or whether there will be other ancillary contamination associated with managing an SMR unit.
To answer your question, we really don't know. We're staying in touch with some leadership with firms that are designing units and getting ready to build them. It's really unknown how much waste you're going to generate at this point. We're not in the spent fuel business. There are other people that are. It's a very different business than we're in. However, what we're hopeful is that when they change out and maintain the units, they'll be generating waste. That will be likely the type of waste we can manage.
Yes, sir.
Do you see anything that you foresee for your PFAS technology?
At this point in time, the first operational, the real operational unit, we're hoping to see in the $3 million-$5 million revenue for Q4. We've projected that unit to do about $5 million a quarter through 2026.
That's not considering adding on other units and optimizing this unit or anything like that. That's just basically from the investments we're making now, we're seeing basically a $5 million quarter in revenue.
Excellent. That was a great job and great overview. We're excited about all the things you guys are doing. We'd look forward to having you back next year. Thank you. All right.
Thank you.