Biofuels

The Inside True Story of a Company Gone Wrong, Part 5 by Jim Lane In 2011, KiOR raised $150 million in its June IPO, claiming that it was generating yields of 67 gallons per ton in its Demo unit operations. But it was miles short of that. In our previous installments, we have charted how KiOR moved from a promising early-stage technology to a public company with serious technological flaws that could have been fixed, but were ignored in what a senior team member speaking for the record, Dennis Stamires, characterized as a “reckless rush to commercial”. By 2012, numerous KiOR staffers of...

Jim Lane No appetite for 200 pages of IPO-speak in Mascoma’s S-1 registration statement? Here’s our 10-minute version. In Massachusetts, Mascoma Corporation announced that it has filed an S-1 registration statement relating to a proposed $100 million initial public offering. The number of shares to be offered and the price range for the offering have not yet been determined, and the company has not indicated yet which exchange it will apply to for a listing of its shares. Here’s the S-1 registration, in a conveniently downsized 10-minute Digest version – with some commentary along the way...

Jim Lane Dyadic International, Inc. is a global biotechnology company that uses its patented and proprietary technologies to conduct research, development and commercial activities for the discovery, development, manufacture and sale of products and solutions for the bioenergy, industrial enzyme and biopharmaceutical industries. Address: 140 Intracoastal Pointe Drive Suite 404 Jupiter, Florida 33477 Year founded: 1979 Stock Ticker: Pink Sheets: DYAI Type of Technology(ies) Patented and proprietary C1 platform technology based on a unique fungal microorganism which is programmable and scalable in producing enzymes and proteins in large quantities ...

Jim Lane Following a stinging WSJ editorial board critique on cellulosic biofuels, we leave a fact-filled voice mail for News Corp to hack. Meanwhile, Mascoma lands $80M and heads for scale. The Wall Street Journal editorial page writers recently published a stinging indictment of cellulosic biofuels. Bottom line: the Journal is offering the shortfall in the cellulosic biofuels pool (around 2% of the overall US Renewable Fuel Standard this year), as evidence that government mandates and subsidies do not work, and that the US government has shoveled a lot of money into advanced biofuels for nothing....

by Debra Fiakas CFA Last week Rentech, Inc. (RTK:  NYSE) revealed plans to idle its wood pellet production facility in Wawa, Ontario Canada.  To operate efficiently the plant requires additional repairs and upgrades beyond the replacement of conveyors that was completed in Fall 2016.  Beside the fact that the additional repairs were not included in the regular capital budget, Rentech management has apparently determined the expenditure is not economic given profits from Wawa.  When Rentech reports financial results for the fourth quarter ending December 2016, shareholders will be treated to an asset impairment charge for the Wawa facility....

Jim Lane Obama unveils an “all-out, all of the above” energy strategy. But is it really “all of the below”? Just election talk? Is ginning up a bioeconomy shelved for a year, or just a week? Meanwhile, hopeful news from Novozymes (NVZMY.PK) and the World Economic Forum. In Washington, President Barack Obama gave his State of the Union speech, and dashed hopes and expectations of a revival strategy for US industry through encouraging growth of the bioeconomy. His annual presidential address became the first in a number of years to avoid any mention of biofuels, ethanol,...

by Debra Fiakas CFA In the last two posts Pacific Ethanol (PEIX:  Nasdaq) and Aemetis, Inc. (AMTX:  OTC/BB) got all the attention.  Both companies have crafted their facilities to accept lower-cost sorghum as an alternative feedstock, opening up the door to lower carbon intensity measures for their ethanol output.  There are other ethanol producers in the state, which we believe are still relying on corn as feedstock.  Which companies will remain in operation in California is not yet clear.  Standards sets by California Air Resources Board (CARB) for the carbon intensity of alternative fuels favors local producers and...

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...

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...

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...

by Debra Fiakas CFA In an article posted in November I incorrectly named the product of Kior, Inc. (KIOR:  Nasdaq) as cellulosic ‘ethanol’.  Kior does indeed use cellulosic biomass -  wood chips to be exact  -  but the company’s catalytic pyrolysis technology turns out crude oil that can be further refined into gasoline or diesel.  Ethanol, on the other hand, is the product of a fermentation process.  There is nothing new about catalytic pyrolysis  -  superheating in a container with no oxygen.  Oil refiners have been fracturing large, complex hydrocarbons using heat and catalysts for...

Jim Lane Closely-watched green gasoline producer collapses as Waste Management (WM) declines next financing round. What does it mean for companies like Fulcrum Bioenergy, Enerkem, Agilyx, Agnion, Renmatix, Genomatica, and InEnTec? The Digest looks at the inside story. In Texas, Terrabon filed for Chapter 7 bankruptcy protection; the company’s operations will cease and a trustee will be tasked with liquidating the company’s assets for the benefit of creditors. The complete Chapter 7 announcement is here. In a statement, Terrabon’s leadership said that company could not obtain additional corporate funding to finish developing and engineering its...

Jim Lane This week, Gevo (GEVO) reported its year-end results, generally in line with expectations, with a $0.35 loss per share and $24.6M in the bank. Given the company’s rate of progress with isobutanol, the cash burn rate, the low share price, and high prices for ethanol the company announced that it is “transitioning the Luverne plant to the production of both isobutanol and ethanol…Producing both ethanol and isobutanol allows Gevo to fully utilize the Luverne plant and increase cash flow as Gevo continues to commercialize its isobutanol production capabilities.” “Our original vision was to focus...

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...