REG Sells More Biodiesel, Earnings Drop, Acquisitions Are Future Wild Cards
Jim Lane Biodiesel giant Renewable Energy Group (REGI) is up on gallons, down on dollars as market prices weigh on results. In Iowa, REG announced net income of $10.8 million for the second quarter on revenues of $332.9M, a drop from its Q2 2013 net income of $19.6 million, and a 13% drop in revenue despite an 11% lift in gallons produced. The company noted that net income was boosted by a tax benefit of $11.9 million, recognized primarily from the release of a valuation allowance resulting from recording deferred tax liabilities related to the...
What I Sold: Dynamotive Energy Systems (OTC:DYMTF)
This entry continues a series on companies I sold as part of a portfolio cleanup prompted by the mess on Wall Street. In the first entry I described what I plan to do with the cash, followed by the reasons why I sold Carmanah Technologies and Pacific Ethanol. UQM Technologies was one I didn't sell. I have not mentioned Dynamotive Energy Systems (DYMTF) before. I have mixed feelings about the company. They use fast pyrolysis to make cellulosic biofuels, which I believe will prove to be one of the more economic pathways to cellulosic biofuels. However, I believe that...
Green Star Products Unveils Advanced Biodiesel Reactor
Green Star Products Inc (GSPI) announced that they have developed and successfully commercially tested their advanced biodiesel reactor. GSPI reactors require an amazing two minutes to complete the biodiesel conversion reaction versus over one hour for the rest of the industry. This means that GSPI's processing rate through the reactor is at least 30 times faster than the rest of the biodiesel industry.
FutureFuel Profits Preview
by Debra Fiakas CFA Biodiesel and biochemical producer FutureFuel Corporation (FF: NYSE) will report fourth quarter 2015 financial results after the market close today. No conference call will be held due to low attendance on recent calls. The single published estimate for FutureFuel is for $0.28 in earnings per share on $122.5 million in total sales. Despite an increase in this estimate in the last week, the number still represents a significant decrease in earnings compared to the prior-year period. The Company has missed the consensus estimate in both of the last two quarters and we do not...
Betting On Renewable Diesel: Valero or Darling?
Valero Energy (VLO: NYSE) recently disclosed ongoing discussions to expand its renewable diesel production to a second plant that would be built and managed by its Diamond Green Diesel joint venture with Darling Ingredients (DAR: NYSE).
The proposed plant that would be located in Port Arthur, Texas and turn out 400 million gallons of renewable diesel and 40 million gallons of naptha per year. As a food by-products processor Darling has easy access to low-cost used cooking oils and animals fats that serves as the feed stock for Diamond Green’s renewable diesel production.
Valero management has cited increasing global demand for low- to no-carbon...
Hither and Yon: Transmission and Biofuels
In the most recent two installments of Energy Tech Stocks' interview with me cover my views on transmission stocks, and biofuel stocks. Readers of AltEnergyStocks know that I am a big fan of electricity transmission, a theme I keep coming back to. You also know that I have a very ambivalent relationship with both ethanol and biodiesel. So I liked Bill's transmission article, but I just wasn't able to convey to him the subtleties of how I feel about biofuels. But he got one thing right: the owners of biofuel feedstock are likely going to be the biggest winners....
A (nearly) Pure-play Biodiesel Stock
On January 29th, M~Wave and private vertically integrated Biodiesel distributor Blue Sun Biodiesel announced a merger between the two, with Blue Sun becoming a division of M~Wave, and the merged company being renamed Blue Sun Holdings. Managerial control will also pass to "certain directors and the officers of SunFuels." If this merger goes through as planned in the second quarter of 2007, US investors will have their first opportunity to invest in a stock focused on a biofuel which is much less controversial among environmentalists than corn-based ethanol. Estimates of the well-to-wheels Energy Return on Energy Invested...
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%...
DAR the Rins Blow!
by Debra Fiakas CFA Last week the management of Darling Ingredients (DAR: NYSE) staged a webinar on its opportunities in biofuels. Darling produces biodiesel in Kentucky and Canada and is in a renewable diesel joint venture with Valero Energy (VLO: NYSE) in Louisiana. As a recycler of wastes and excess from the food production processes, the production of energy with organic feedstock is a logical extension of Darling’s collection and aggregation infrastructure. The event did not do much for Darling’s share price, but the presentation triggered a few questions about RINs - shorthand for...
Biofuel Industry Reacts To EPA New Renewable Fuel Standard
Yay or Nay for EPA? RFS Volumes out for 2020, Biodiesel for 2021 – What’s the reaction from industry?
by Jim Lane
What’s the reaction from industry? Coal for Christmas?
Should Santa bring coal for EPA’s stocking this year? Do the biofuels and agriculture industries think the EPA just put coal in their stocking? Is it thumbs up or thumbs down from biofuel industry advocates on last week’s U.S. Environmental Protection Agency renewable fuel volumes? What about the exempted volumes?
The Ruling – Rotten or Respectable?
First, a bit on the EPA ruling that establishes the required renewable volumes under the Renewable Fuel Standard (RFS) program for...
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...
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...
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...
The Low Sulfur Diesel Crisis of 2020 And How To Prevent It
“The global economy likely faces an economic crash of horrible proportions in 2020, not for want of a nail but want of low-sulfur diesel fuel,” writes renowned energy analyst Phil Verleger in a note this month titled “$200 Crude, the Economic Crisis of 2020, and Policies to Prevent Catastrophe”. Not good timing for a White House re-election effort if, as expected, the blame falls on lack of preparedness in the 2017-2020 run-up to the projected crisis..
It’s a dire scenario but there’s hard data behind it, and though few go as far as Verleger, almost every expert is warning of a...
Methes: The McDonald’s of Biofuel
by Debra Fiakas CFA Few would make the connection, so Methes Energies International (MEIL: Nasdaq) chief executive office explains his company’s unusual business model in McDonald’s terms. Methes, which is a contraction of ‘methyl ester,’ has developed a biodiesel system that accommodates various feedstocks that yield methyl esters. The system is a handsome, compact configuration of stainless steel tanks and piping that are all capable of automated operation. The company operates its own commercial-scale facilities in Ontario, Canada. Sales of biodiesel represent the majority of Methes revenue, which totaled $10.3 million in the twelve months ending...
North American Outlook on Biofuels Challenges and Opportunities
Challenges and Opportunities in Biofuels
By Steve Hartig, Former VP of Technology Development at ICM
The North American biofuels market can be split into three main segments all of which have major dynamics. What I would like to do is give a high-level overview of what I see as some of both the challenges and opportunities across these.
Ethanol which is a produced from corn and sorghum in about 200 plants mainly across the Midwest and blended at about 10% with gas. Majors such as POET, Green Plains, Flint Hills, Valero, ADM and Cargill do a bit more than half of the 16...
