Future Fuel’s Enticing Earnings
by Debra Fiakas CFA Who doesn’t like a bargain? FutureFuel Corporation (FF: NYSE) is trading near $13.15 per share, below nine times net earnings. Yet, the enticing earnings multiple might be only part of the story. The stock has gapped down in price twice in the last six months, trailing off after each leg down. The stock now appears oversold. Based in Missouri, FutureFuel produces biodiesel and biobased speciality chemical products. In the twelve months ending June 2014, the company reported $396.9 million in sales, providing $53.5 million in net income or $1.52 per share. ...
Amyris hits the comeback trail
Jim Lane Biofene production starts up in Paraiso, Brazil – sales expected to commence in Q1 2013 – Total, Temasek, Biolding inject fresh capital. What’s next for biofuels’ “Comeback Kid”? By now, most of the “smart set” that found itself excited about Amyris (AMRS), and about advanced synthetic biofuels during the IPO fever, have moved on. They read Dan Grushkin’s “The Rise And Fall Of The Company That Was Going To Have Us All Using Biofuels” in Fast Company, wrote off Amyris and possibly the entire sector, and presumably migrated their enthusiasm to low-cost natural gas, battery...
EPA increases US Renewable Fuel Standard Volumes, But Only Slightly
Jim Lane In Washington, the U.S. Environmental Protection Agency announced final volume requirements under the Renewable Fuel Standard program today for the years 2014, 2015 and 2016, and final volume requirements for biomass-based diesel for 2014 to 2017. This rule finalizes higher volumes of renewable fuel than the levels EPA proposed in June, boosting renewable production and providing support for robust, achievable growth of the biofuels industry. “The biofuel industry is an incredible American success story, and the RFS program has been an important driver of that successcutting carbon pollution, reducing our dependence on foreign oil, and sparking...
Soladiesel Algae Fuel is a Monster Hit
Jim Lane Sales increase 35 percent at participating test sites and survey results reveal driver preference for algae-based Soladiesel over conventional fuels. In California, Propel Fuels and Solazyme (SZYM) announced that sales grew by 35 percent at Propel stations, offering SoladieselBD in a B20 blend during a 30-day retail pilot program, compared to non-test sites. The pilot was conducted at Propel’s Clean Fuel Points in Redwood City, San Jose, Berkeley, and Oakland. In addition, a follow-on consumer preference study with Propel’s customers found 92 percent of participants noted that they would be more likely to...
Fortunately, Unfortunately: The Spring Saga of American Ethanol
by Jim Lane
The ethanol signals from Washington DC are more inexplicably mixed than cocktails with names like Sex on the Beach. Let’s parse through the wigwagging over the future of American biofuels supply and demand — ethanol and otherwise.
Fortunately: Trump backs year-round E15 ethanol blends
In Washington, President Trump endorsed year-round E15 ethanol availability as an emerging compromise between oil refiners and US farm sector.
The Renewable Fuel Standard is a federal program that requires transportation fuel sold in the United States to contain a minimum volume of renewable fuels. The RFS originated in a bi-partisan Congress with the Energy Policy Act...
Ethanol and Biodiesel: Production Cost and Profitability
For a number of years, this (now old and outdated, but) very useful chart has been in circulation in energy circles, mapping the supply of energy to the world by looking not at prices, but at production costs. For one thing, it goes a long way to explaining why the price of oil can tumble so quickly when there is a fall off in demand, and explains why OPEC is troubled by unconventional oil in a way it is not so bothered by other energy sources such as renewable fuels. Renewables not only have been traditionally at the...
Darling Ingredients: At the Margin
by Debra Fiakas CFA This week Darling Ingredients (DAR: NYSE) reported earnings of $100,000 on net sales of $874.7 million in the first quarter ending March 2015. Darling is a recycler of sorts, collecting by-products of the food production industry and recycling the left-overs and waste into proteins, fats and leathers. Nothing goes to waste. Every last chicken feather, hide, gallon of used cooking grease and cake crumb gets up-cycled to a usable material for feed, food, fuel or clothing. Its customers include pet food producers, personal care manufacturers and textile users, among others. Darling used...
REG Buying European Biodiesel From Used Cooking Oil Producer
Jim Lane US biodiesel leader heads for the EU – what’s up with used cooking oil, and what is REG’s path forward with the German-based biodiesel producer? In Iowa, Renewable Energy Group and IC Green Energy announced that REG will acquire ICG’s majority equity ownership position in German biodiesel producer Petrotec AG (XETRA: PT8). Closing of the transaction is expected before year end. REG CEO Dan Oh Last month, REG CEO Dan Oh told The Digest, “We’re not done growing, that’s for sure! We’ve done something of...
Biodiesel’s Big Comeback
Jim Lane Filling up with Biodiesel in 2007. Photo source: Tom Konrad Darling of the mid-2000s, still beloved by its many fans biodiesel is increasingly a key to delivering advanced biofuels volumes now and even more so between now and 2022. Presentations by NBB CEO Joe Jobe and REG CEO Daniel Oh at ABLC 2013 explained the how and why. In the excitement over cellulosic biofuels and drop-ins, it is easy to forget that the backbone of advanced biofuels in the US and around he...
Neste Sells 1 Billionth Gallon of Renewable Diesel
Neste reaches 1B gallons renewable diesel sale, runs in fire trucks, ambulances and school vehicles
In Texas, Neste U.S., Inc. (NEF.F, NESTE.HE, NTOIF, NTOIY) is celebrating its 1 billionth gallon of Neste MY Renewable Diesel sold in North America which has effectively helped reduce more than seven million metric tons of greenhouse gas emissions in the Earth’s atmosphere. This is the equivalent of removing 1.6 million passenger vehicles from the road for one year.
“There’s never been a better time to take a closer look at the steps we’re taking to ensure we’re leaving our planet in a healthier state for future generations,”...
Biodiesel Christmas Caroling: FFA La La
Jim Lane “On the way” forever, talked up by all, deployed by some – technologies that handle high free fatty acid feedstocks like used cooking oil are coming into their hey-day, via players like REG, Novozymes, Pacific Biodiesel, Blue Sun, Piedmont, COMAC and more. Christmas come early for advanced biofuels? One of the most alluring targets in advanced biofuels although cruelly mis-named is in the world of free fatty acids. Most of the oils currently used for biodiesel are sourced from soybeans, palm or rapeseed, and precisely because they contain less than 0.5%...
EPA Reneges on Trump’s Biofuels Deal
by Jim Lane
“EPA Reneges on Trump’s Biofuels Deal”, said the Iowa Renewable Fuels Association in reacting to the US Environmental Protection Agency’s new plans for fulfilling federal renewable fuel requirements. EPA released a proposed supplemental rule for the Renewable Fuel Standard today, and the bioeconomy is up in arms, and the outrage is centered in farm country, once a Trump bastion of support.
“IRFA members continue to stand by President Trump’s strong biofuels deal announced on Oct. 4, which was worked out with our elected champions and provided the necessary certainty that 15 billion gallons would mean 15 billion gallons, even after...
Solazyme’s Oilcane Boom
Jim Lane Though building capacity globally, Solazyme’s operations in Brazil are getting traction fast – and raised $235M last week. How much oil could be produced in Brazil via sugar-munching microalgae? Today, the Digest looks at Solazyme’s (SZYM) progress and the bigger picture. In California, two monster announcements came out of Solazyme headquarters last week. One related to project finance and one related to raising cash. In midweek, Solazyme Bunge (BG) Renewable Oils received approval for project financing in the form of a $120M (R$245.6M) loan from the Brazilian Development Bank (BNDES). ...
REG Buys Imperium Renewables
Jim Lane The biggest US biodiesel, renewable diesel producer Renewable Energy Group (REGI), or "REG" buys the biggest US facility in asset deal. The fully-operational 100-million gallon nameplate capacity biorefinery will be renamed REG Grays Harbor. The facility includes 18 million gallons of storage capacity and a terminal that can accommodate feedstock intake and fuel delivery on deep-water PANAMAX class vessels as well as possessing significant rail and truck transport capability. REG will pay Imperium $15M in cash and issue 1.5 million shares of REG common stock in exchange for substantially all of Imperium’s assets. In addition to...
Oh, No! Renewable Energy Group CEO Departs
Oh, No! Renewable Energy Group CEO Departs
Intirim CEO plans no strategy change
Jim Lane
In Iowa, Renewable Energy Group (REGI) announced that Dan Oh has resigned as President and Chief Executive Officer and as a member of the Company’s Board of Directors. The resignation was effective July 3, 2017. The Board of Directors appointed long-time director Randolph (Randy) L. Howard as Interim President and Chief Executive Officer.
Howard is a 33-year veteran of Unocal, has been on the REG board since 2007 so, a familiar face at 67, may not be in the job for the long-haul, but a strong interim pick.
Oh...
Biodiesel Tax Credit Back In US Budget Deal
by Jim Lane
In Washington, the US Congress passed its budget deal, and among the items in the deal was a retroactive restoration of the $1 per gallon biodiesel tax credit for 2017. The bill did not include a provision for 2018 and future years.
The budget compromise had run into headwinds in the Senate, in the form of a voting delay imposed by Rand Paul of Kentucky, while opposition in the House from a group of Democrats and hardline conservatives had put the bill into some degree of jeopardy.Renewable Energy Group CEO Randy Howard said “We are pleased that Congress recognized...
