Leverage technology for the development and production of additional advanced
biofuels and renewable chemicals. In March 2016, we acquired the exclusive rights
to the LanzaTech Technology for the conversion of agricultural waste, forest waste,
dairy waste, and construction and demolition waste to ultra-low carbon fuel ethanol
in California. We intend to utilize this technology to produce advanced ethanol
from local California biomass wastes. Utilizing a phased approach, we initially
anticipate adopting the LanzaTech Technology at the Keyes Cellulosic Ethanol Facility,
which will initially be an estimated eight million gallon per year name-plate
capacity processing unit, and eventually expand to an estimated 32 million gallon
per year name-plate production capacity plant. We also plan on licensing the LanzaTech
Technology to other existing California-based ethanol plants. In addition, we
continue to evaluate new technology and develop technology under our existing
patents, patent pending and in-process research and development to produce renewable
chemicals and advanced fuels from renewable feedstocks. Our objective is to continue
to commercialize this technology and expand the production of advanced biofuel
technologies and other bio-chemicals in the United States.
Diversify and expand revenue and cash flow by continuing to develop and adopt
value-added by-product processing systems. During April 2012, we installed a DCO
extraction unit at the Keyes plant and began extracting corn oil for sale into
the livestock feed market beginning in May 2012. During 2014, we installed a second
oil extraction system to further improve corn oil yields from this process. We
continue to evaluate and, as allowed by available financing and incremental profitability,
adopt additional value-added processes that increase the value of the ethanol,
distillers grain, corn oil and CO2 produced at the Keyes plant, including adding
liquefied CO2 processing capability. Advanced planning is underway to partner
with a leading industrial gas supplier to build a liquid CO2 capture plant adjacent
to the Keyes plant.
Acquire, license our technologies to, or Joint venture with other ethanol and
biodiesel plants. There are approximately 200 ethanol plants and one hundred biodiesel
plants in the U.S., as well as plants in Brazil, Argentina, India and elsewhere,
that could be upgraded to expand revenues and improve cash flow using technology
commercially deployed or licensed by us. After developing and commercially demonstrating
technologies at the Keyes and/or Kakinada plants, we will evaluate on an opportunistic
basis the benefit of acquiring ownership of a portion of or all of other biodiesel
production facilities, or entering into joint-venture or licensing agreements
with other ethanol, renewable diesel or renewable jet fuel facilities.
Evaluate and pursue technology acquisition opportunities. We intend to evaluate
and pursue opportunities to acquire technologies and processes that result in
accretive value opportunities as financial resources and business prospects make
the acquisition of these technologies advisable. In addition, we may also seek
to acquire companies, or enter into licensing agreements or form joint ventures
with companies that offer prospects for the adoption of accretive technologies.
Acquire additional biofuels production facilities. On an opportunistic basis,
we will evaluate the benefit of acquiring ownership of a portion of or all of
other biodiesel production facilities, or entering into joint-venture or licensing
agreements with other ethanol, renewable diesel or renewable jet fuel facilities.
India
Capitalize on recent policy changes by the Government of India, particularly those
reducing the subsidies on diesel, reducing unfair taxation of feedstock, reducing
restrictions on sales of fuel into the transportation markets, and promoting the
use of renewable transportation fuels. We plan to continue to pursue the traditional
bulk and transportation biodiesel markets in India, which may become more economically
attractive as a result of potential changes to government tax structures (biodiesel
is not subsidized in India) and policies. With the rationalization of indirect
taxation by the introduction of Goods and Services Tax, business to government
Oil Marketing Company contracts will open up. Additionally, with the European
Union exempting Indian biodiesel from a 6.5% import duty starting January 1, 2017,
we plan to pursue export sales and look to aggressively sell in the European Union.
Expand alternative market demand for biodiesel and its by-products. We plan to
create additional demand for our biodiesel and its by-products by developing additional
alternative markets. In 2011, we began selling biodiesel to textile manufacturers
for use as an anti-static chemical. In the first quarter of 2012, we completed
glycerin refining and oil pre-treatment units and began selling refined glycerin
to manufacturers of paints and adhesives. In 2012, our India subsidiary received
an Indian Pharmacopeia license, which enables the sale of refined glycerin to
the Indian pharmaceutical industry.
Continue to develop international markets. We expect to increase sales by selling
our biodiesel into international markets. During 2014, we completed the construction
of a biodiesel distillation column, which allows us to produce a high-quality
biodiesel product meeting European Union standards. We received the certifications
necessary to meet the International Sustainability and Carbon Certification (ISCC)
standard, allowing for further access to European markets for our biodiesel products.
During 2015, we obtained the pathway certification permitting importation of biodiesel
into California. In 2016, the European Commission adopted a list of new product
categories originating in GSP (Generalized System of Preferences) beneficiary
countries for which GSP tariff preferences will be suspended from January 1, 2017
until December 31, 2019. Our distilled biodiesel falls under the category giving
us at least a 6.5% tariff suspension from January 1, 2017. We believe that this
ruling will allow us to access the European markets for our high quality distilled
biodiesel.
Diversify our feedstocks from India and international sources. We designed our
Kakinada plant with the capability to produce biodiesel from multiple feedstocks.
In 2009, we began to produce biodiesel from non-refined palm oil (NRPO). During
2014, we further diversified our feedstock with the introduction of animal oils
and fats, which we used for the production of biodiesel to be sold into the European
markets. The Kakinada plant is capable of producing biodiesel from used cooking
oil (UCO), which can be supplied from China, the Middle East and other foreign
markets, as well as domestic India suppliers.
Develop and commercially deploy technologies to produce high-margin products.
The technology applicable to the Keyes plant for the upgrade of corn oil into
valuable, high-margin products also applies to the Kakinada plant in India. By
using the existing equipment, process controls, utilities and personnel at the
Kakinada plant, we plan to produce high-value products more quickly and at a lower
capital and operating cost than greenfield projects.
Evaluate and pursue technology acquisition opportunities. We intend to evaluate
and pursue opportunities to acquire technologies and processes that result in
accretive value opportunities as financial resources and business prospects make
the acquisition of these technologies advisable. In addition, we may also seek
to acquire companies, or enter into licensing agreements or form joint ventures
with companies that offer prospects for the adoption of accretive technologies.
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