Coskata’s $100 million IPO: The 10-Minute Version
Jim Lane The first gas fermentation technology to come to the public markets: Coskata files its $100 million IPO. Here’s our 10-minute version of the filing, with a translation of the risks into English. In Illinois, Coskata has filed an S-1 registration statement for a proposed $100 million initial public offering. The number of shares to be offered in the proposed offering and the price range for the offering have not yet been determined. The lead book-running managers for the offering are Citigroup, Barclays and Piper Jaffray. The company is currently ranked #17 in the world...
Ethanol Stocks: Risks, Challenges, & Opportunities
The Great Ethanol Debate: Shoddy Economics all 'Round. Like many environmentalists, I'm not a big fan of the ethanol industry, especially corn ethanol. From a net energy standpoint, even advocates agree that you only get a little more energy out than the energy you put in (Energy Return on Energy Invested or EROEI of 0.9 to 1.5, depending on whom you ask... some say it's much lower.) At this point, most environmentalists simply decide that ethanol isn't sustainable enough for them, and go back to talking about photovoltaics (EROEI around 8, PDF) and wind (EREOI 30-70, PDF). The last...
Pacific Ethanol Completes Permitting for Planned Ethanol Plant in Boardman, Oregon
Pacific Ethanol, Inc. (PEIX) announced that it has received all necessary permits to begin construction on a 35 million gallon per year ethanol facility at the Port of Morrow, located on the Columbia River near Boardman, Oregon. The Company further stated that it expects to begin construction, which should take approximately 12 months, within the next thirty days. The Oregon ethanol facility will provide ethanol for the Pacific Northwest gasoline markets, helping to increase supply in that area and provide a CO2-reducing fuel for the transportation sector. It is expected that the plant's distillers grains will be sold...
Veridium Receives Order to Increase Ethanol Production Efficiencies
Veridium Corp. (VRDM.OB) announced its receipt of an order from a Wisconsin based ethanol producer for the second stage of Veridium's patent-pending Corn Oil Extraction Systems(TM). Veridium's proprietary new Corn Oil Extraction Systems(TM) extract high grade corn oil from an ethanol by-product called distillers dried grain ("DDG"). Currently, the majority of ethanol production is based on a dry milling technique that utilizes more than 1 billion bushels of corn to produce 3 billion gallons per year of ethanol. The dry mill process converts the starch from the kernel of corn into sugar and then the sugar into ethanol....
EPA Administrator Scott Pruitt Resigns
by Jim Lane
In Washington, EPA Administrator Scott Pruitt has resigned.
US President Donald Trump announced the exit on Twitter, commenting, “President Donald Trump announced Pruitt’s exit, saying on Twitter “I have accepted the resignation of Scott Pruitt as the Administrator of the Environmental Protection Agency. Within the Agency Scott has done an outstanding job, and I will always be thankful to him for this.”
Deputy Administrator Andrew Wheeler becomes acting administrator.
The Digest’s Take
Elsewhere in the media, it is widely reported that Pruitt was undone by a growing number of controversies and investigations relating to his conduct as EPA Administrator, particularly relating...
Clearfish Research Profiles Pacific Ethanol (PEIX)
Pacific Ethanol (PEIX) is building a refinery in California for corn based ethanol production in the heart of the California agricultural and dairy land (the biggest agricultural and dairy producer in the country). The refinery is supposed to come on line in Q4 2006, and there are plans for 4 more subsequent refineries. As there is unlikely to be any increased ethanol demand in California (see background above), the supply capacity they are bringing online must be able to disrupt the current out-of-state supply and/or undercut the current prices. They are one of the biggest distributors of that alternate...
Advantage Biodiesel
By Tom Konrad, Ph.D., CFA
Because of rising fertilizer prices, farmers are planting more soybeans than corn. Soybeans are a legume, meaning that they can fix their own nitrogen in the soil, meaning that they need less nitrogen fertilizer, the price of which is spiking due to rising natural gas prices. Corn, in contrast, needs more nitrogen than most other crops.
High gas prices are rising because of Putin’s war on Ukraine, which is also preventing Ukrainian farmers from planting this year’s wheat crop, while sanctions are likely to disrupt wheat supplies from Russia as well.
Corn and (to a lesser extent,...
EPA’s 2018 Renewable Fuel Targets Disappoint Producers
In Washington, the Environmental Protection Agency released its final Renewable Fuel Standard renewable volume obligations for 2018. The agency finalized a total renewable fuel volume of 19.29 billion gallons , of which 4.29 BG is advanced biofuel, including 288 million gallons of cellulosic biofuel.
As the Renewable Fuels Association explained: “That leaves a 15 BG requirement for conventional renewable fuels like corn ethanol, consistent with the levels envisioned by Congress in the 2007 Energy Independence and Security Act. The 2018 total RFS volume finalized today represents a minor increase (10 million gallons) over the 2017 standards, and a modest increase...
Aemetis acquires Edeniq for $23.7M
Jim Lane In California, Aemetis (AMTX) will acquire all of Edeniq’s outstanding shares in a stock plus cash merger transaction. In 2015, Edeniq generated approximately $20 million in revenue and $6 million in positive EBITDA. Headquartered in Visalia, California, Edeniq has 30 employees working at advanced research and development facilities, as well as pilot plants funded through grants from the DOE and the California Energy Commission. Under the terms of the agreement, Aemetis expects to issue between one and two million shares of its common stock (depending on whether Edeniq stockholders elect to receive part of their consideration...
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...
Veridium Receives Order from South African Ethanol Producer for Corn Oil Extraction Technology
Veridium Corp. (VRDM.OB) announced its receipt of an order from Ethanol Africa for the use of Veridium's patent-pending Corn Oil Extraction System(TM) at Ethanol Africa's new Bothaville, South Africa ethanol production facility. Veridium's proprietary new Corn Oil Extraction Systems(TM) extract high grade corn oil from an ethanol by-product called distillers dried grain ("DDG"). Veridium's technology has the capability of removing up to 75% of the corn oil from within the DDG in two stages. I have been finding more signs that this looks like its a real company and not just a shell to take advantage...
Are Ethanol Companies Risky Investments?
By Neal Dikeman, Partner, Jane Capital Partners LLC, and Founding Contributor, Cleantechblog.com. He has no investments in or financial incentive related to ethanol or ethanol stocks. Are ethanol stocks risky long-term investments? We think they are. Don’t get me wrong, I’m a big fan of ethanol blended fuels for a whole host of reasons, I just don’t like ethanol as an investment. Here are six solid reasons to be very, very cautious. 1. Demand vs. supply – As with most regulatory driven markets, the demand has come on very fast behind the advent of renewable...
7 Bleeding-Edge Technologies Reinventing First-gen Ethanol Plants
Jim Lane The US Ethanol Fleet reinvents as super-advanced technologies target the old fleet for new purposes. Ethanol Plant Photo via BigStock For some time, perhaps one of the toughest assets to manage in the Western World possibly the Milky Way Galaxy or even the local galaxy group has been a starch ethanol plant. They’ve been through it all, just about. Food vs fuel, indirect land-use change, the ethanol blend wall, attacks on the RFS from cattle and dairy interests, attacked on ethanol tax credits,...
Green Plains, Green Profits
by Debra Fiakas CFA Green Plains Renewable Energy, Inc. (GPRE: Nasdaq) is one of the few U.S. ethanol producers to turn a consistent profit. The company is half way through its fifth consecutive profitable year. Sales in the most recently reported twelve months totaled $3.4 billion, on which the company earned $40.5 million in net income. During this period Green Plains generated $100.0 million in operating cash flow. Tracing Green Plains profits requires a bit of effort by investors. The company channels its products through a marketing and distribution division. Thus while, ethanol production...
Ethanol Sector Consolidation or Salvation?
by Debra Fiakas CFA The drumbeat of deals in the ethanol industry is sounding louder, or so it seems from the proliferation of notices in my e-mail inbox. I received no less than four messages in one morning from ethanol producer Green Plains, Inc. (GPRE: Nasdaq) heralding the purchase of the Hopewell Ethanol plant in Virginia from FutureFuel, Inc. (FF: NYSE). The acquisition represents the ninth transaction for Green Plains in the last five years, adding another 60 million gallons in annual production capacity to Green Plains’ existing total capacity of 1.02 billion gallons. Indeed, Green...
US Ethanol Industry Upset With 2019 Renewable Fuel Standard Proposal
The 2019 proposed US Renewable Fuel Standard proposed volumes attracted a major raspberry from the ethanol industry.
As the American Coalition for Ethanol noted:
“Unfortunately, EPA continues to take actions which undermine the letter and spirit of the statute and harm the rural economy. While refiners are reporting double-digit profits, the heart of America is being left behind. Farmers are losing money while refiners have the best of both worlds: fat profit margins and minimal RFS compliance costs. EPA needs to discard its refiner-win-at-all-costs mentality and get the RFS back on track.”
“While the proposed rule purports to maintain the 15-billion-gallon conventional...
