Renova Energy Share Discussion Threads

[j5ack5k] 12/10/2007 16:10

Moto, nice spot on the first article, but that second one is WAY out of date. It happened at least six months ago.

[motoben] 12/10/2007 15:15

cheers j5ac5k

[motoben] 12/10/2007 15:13

HEYBURN n The city council took the first step in upgrading its water system Wednesday night, passing a resolution raising the base water rate to $26.69.

The new base rate more than doubles the existing rate of $12.97 per 5,000 gallons. Overage charges were also raised 20 cents to 75 cents per 1,000 gallons.

Included in the resolution is an automatic 3 percent increase to the base rate for the next five years, which will eventually raise the rate to $30.02

During the public hearing residents voiced concern about the sudden leap in rates, especially in regards to senior citizens living on fixed incomes.

The council spent the hearing explaining its justification for the rate increase and sympathizing with residents.

*

"This hasn't been thought of lightly," Councilman Rocky Baker said. "If we don't do it now the cost in the next few years will be just that much more."

Rates in the city have not been raised in six years and the water department has lost money for the past three years.

Baker said water pressure levels in parts of the city are causing problems for the fire department and could result in a tragedy if conditions are not improved.

Loren Jalbert, an engineer with Sunrise Engineering, presented a facility planning report to the council examining the water usage needs of the city through 2027.

The report estimated Heyburn's population would grow from 2,755 in 2005 to 9,445 in 2027. Jalbert said this was based on 5.76 percent yearly growth on par with the rest of the state.

The potential growth would result in the city needing 2,575 more water connections in 20 years. The city is serving 1,247 connections.

Jalbert said the report estimated Heyburn's water flow demands would rise from 15 million gallons per month to 75 million gallons per month in 2027.

The report gave six conclusions and recommendations, from a do nothing approach to a $6.9 million plan separating culinary water from irrigation water.

A bond on the Nov. 6 ballot is set to pay for the first of three wells the report recommends and upgrade the water distribution system on the city's south side.

The area includes the new elementary school and an already approved subdivision of 85 homes.

City Superintendent Scott Spevak made it clear the city had to raise rates even without the bond.

However, if the bond fails the city would be facing a scenario in which it would have to pay for water system upgrades without substantially lower interest rates.

"It's going to be very difficult if that bond doesn't pass," City Attorney Steven Tuft said.

Spevak said grant money is not available because the city's water supply is not contaminated.

"If we don't keep up on this, there will be a time we won't be able to flush our toilets or have drinking water and we won't have the money to fix it," Councilwoman Cleo Gallegos said.

[bpoole] 11/10/2007 10:41

So, when is the company going to start buying back shares ? Do they think the share price will still fall further?

[j5ack5k] 10/10/2007 11:53

Article on Renova in ethanol producer magazine (finally some coverage!)

"Niche Marketing"

Wyoming Ethanol LLC, owned by Renova Energy PLC, is a small, old plant in a state known more for its fossil fuel reserves than for its crop production. Nevertheless, the facility has carved out a successful marketing niche.

[jimarilo] 10/10/2007 11:07

Minnesota's first ethanol 'blender pumps' open in Ortonville...

Oct 9 2007 4:48PM
Associated Press

The pumps allow motorists to choose an ethanol blend ranging from E-85, which is 85 percent ethanol, down to the legally mandated E-Ten. All gasoline sold in Minnesota must contain at least ten percent ethanol.

[jimarilo] 08/10/2007 07:24

Ethanol helps drive gasoline prices down

Significant drops in the price of ethanol have allowed motorists to enjoy a lower price for gasoline containing 10 percent ethanol verses regular gasoline in the last several weeks of as much as 10 cents per gallon or more.

[jimarilo] 06/10/2007 08:17

Associated Press
Sector Roundup: Chip Stocks, Ethanol

Among the sector activity stories for Friday, Oct. 5, from AP Financial News:

NEW YORK (AP) - Ethanol stocks rose Friday, echoing an improvement in the broader market, as a BB&T Capital Markets analyst said the sector's downturn will reverse after a few quarters.

[j5ack5k] 05/10/2007 22:34

This was on DTN for today's ethanol market summary:

"Ethanol plant profitability increased 4 cents per gallon of ethanol produced Friday, due largely to increased distillers grain prices. Dry distillers grain prices are listed at $110 per ton, up $5 to $10 per ton from last week."



This puts their hypothetical 50mg plant in South Dakota near break even. Wyoming rack prices (which RVA tend to beat) are much higher than South Dakota, RVA's debt levels are much lower too. I think they should be doing ok now.

[j5ack5k] 03/10/2007 15:24

haha, good luck i hate diy. An email would be a good idea, don't forget to share anything you find out!

[motoben] 03/10/2007 15:08

i was thinking it because its the blenders that get a subsidy not the producers, if i understood it right. may send an email to clarify when i finish my stupid wallpapering.

[j5ack5k] 03/10/2007 12:00

I think (and I'm not 100% sure on this) the distribution terminals are on major gasoline supply routes. Tankers (already containing gasoline) stop at the terminals on the way to end-user gasoline stations. By adding it at the terminal, the ethanol mixes in the truck en route (grandly called "splash-blending" - however it just means pouring ethanol in the top of a lorry already containing gasoline). This is why they get higher realised prices vs competitors as the marketing, production and distribution is all integrated.

So they certainly do blend with petrol there, but where I get hazy is whether they sell pure to other ethanol marketers (I would guess they do when it is profitable).

You raise a really interesting question because when looking at RVA, the difficult thing to understand (and therefore value) is the distribution and marketing side of the business. I'm hoping they will go into a lot more detail at the interims as it could prove to be a trump card in these difficult conditions.

[motoben] 03/10/2007 10:53

rva transport this stuff to their distribution terminals, do they blend it with petrol there as well or just sell it to others pure?

[dasv] 02/10/2007 22:52

as I thought. Just sentiment about the sector dragging RVA's share price down. If margins are better than two years ago, and RVA is as fiscally tightly run as it's said to be, then we should see a real turnaround in the share price in 2008 at the latest.

[j5ack5k] 28/9/2007 18:00

I emailed Chris Thomas about a week ago with this question (rest of q&a on RVA iii thread):

What in your view, is the reason for the decline in share price over the last month, and do you still intend to buy back shares as hinted at in previous communications?

and he said this:

"It is difficult to pinpoint exactly why the share price has fallen recently. The initial fall back in April 2007 was due to one of our largest institutional shareholders selling their entire holding (at a significant discount to the share price at the time). The price, of course, immediately came back to this price. Since then the share price has continued on a downward trend on very low volumes. There is, it has to be said, a fair amount of negative opinion doing the rounds at the moment about the bio-fuel industry in general and, in particular, its impact on food prices through higher corn/wheat prices and this must be having an impact on market perception and, therefore, our share price. Higher corn prices have reduced ethanol production margins compared to 2006, but this has to be kept in context – our production margins now are still higher than they were two, five or ten years ago. On the issue of share buy-backs – it is something that we are still considering even though it would be unusual for a company of our size to do so"

So nothing definite really...

[bpoole] 28/9/2007 17:25

When is RVA going to start buying back shares?

[j5ack5k] 25/9/2007 19:18

Just out...



A drop in corn price to $3 would be welcome, although trading still looks tough.

[j5ack5k] 23/9/2007 00:10

Thanks Jimarilo, without legislation I think it may be a while before we see prices rise significantly (i.e. next summer), but I've always maintained from the outset (mainly on iii) this is a long term play.

I think most investors discount Renova because they don't bother to research it properly. They read doom and gloom articles (see the completely factually incorrect one above) and look at ethanol and corn prices without factoring in forward purchasing and long term sales contracts, local market prices, energy and distillers grain prices, and overall debt levels. They also tend to ignore distribution infrastructure and different business models that can massively distort results when taken in the context of future earnings.

It seems to me that many articles also seem to be driven by the PR machines of various interest groups and its easier for journalists to write total cr*p and grab headlines than provide a balanced perspective.

And for the trolls out there post what you want (I'm sure you will)... but it'll be me and the faithful that will be counting the buckeroonies when this comes good.

In the meantime, enjoy the following:

[j5ack5k] 20/9/2007 11:48

Ethanol Blended in Gasoline by Distributors Rises 6% in 4 Weeks

[drjudywood] 19/9/2007 07:29

crazy!

Corn Ethanol & its Unintended Consequences for California

Juliette Anthony, M.A., M.S., Consultant
Sept 19, 2007
www.renewableenergyaccess.com

Growth of the corn ethanol industry in California is fraught with unintended consequences, none of which are beneficial to the economy or the environment of the state. They include impacts on our overcommitted water resources, on our air quality, on the price of food, and on the financial burden to citizens while private investors profit.

Already there are 235 ethanol plants under construction or in planning stages across the county, in addition to 111 operating plants. And there just isn't enough corn to go around. If all the scores of factories under construction or planned go into operation, they will gobble up no less than half of the entire corn harvest by 2008.

All of the water systems upon which the state depends, to serve both agriculture and the urban sector, are oversubscribed. Ethanol requires large amounts of water both to grow the corn and to process it, putting corn into direct competition with our agricultural industry that feeds half the nation with all of its fruits, vegetables and nuts.

Corn ethanol requires 3.7 to 5 gallons of water to produce 1 gallon of ethanol just in the manufacturing process. Cellulosic ethanol from other plant materials is far in the future and will require 6 gallons of water for each gallon of ethanol to manufacture, though the energy output is 4-5 times greater than for corn ethanol.

States such as water rich Minnesota and Iowa complain that the ethanol industry is mining their groundwater, causing some plants to be closed because the groundwater supply has been so depleted. In many places in California, especially in the San Joaquin Valley, the ground has already subsided many feet because of groundwater mining.

Approximately 14 percent of the U.S. corn crop is irrigated and this irrigated acreage consumes almost 18 million acre-feet per year of water-much of which is overdrafted from the Ogallala aquifer in the Great Plains. To put this water requirement in perspective, the average annual flow of the Colorado River at Lee's Ferry is only about 14 million acre-feet per year.

Almost all of California's agriculture is dependent on irrigation. Diverting millions of gallons of water from California farms to ethanol will disrupt the nation's food supply for growing since corn is a very water intensive crop, and it will also add to the problem of pesticide and fossil fuel fertilizer run-off polluting our waterways. Shifting our valuable farmland from vegetables to mono-cropping corn is already happening in Kern County.

If all the vehicles in California operated on E85 [the policy of the Governor and Legislature], the ethanol required would consume 70 percent of the entire U.S. corn crop, but only 13.6 percent of the energy in the fuel would be renewable because of the heavy use of fossil fuel.

In Iowa and Indiana, the Sierra Club has sued because ethanol plants have made neighbors ill from toxics in the air and the water. Biofuels are not as clean as they would have us believe. Ethanol molecules are microscopically small and escape from gas tanks and hoses. Its use increases NOX by 5%, and for every 18 degrees fahrenheit increase in temperature over baseline, evaporative emissions double. Ground level ozone is also increased. While the ARB is required by state law to ensure that emissions do not increase, plans for mitigation are years away from being implemented. And corn is not the best raw material for fuel. It takes 10 gallons of ethanol to produce the energy equivalent of about 7 gallons of gasoline, and greenhouse gas reductions are minuscule.

Very much like the original backers of MTBE, both from industry and major environmental groups, who adamantly ignored the warnings regarding MTBE's ability to contaminate drinking water, many of these same people are avoiding the unintended consequences of diverting millions of gallons of water into ethanol plants. They fought to preserve the oxygenate mandate so that ethanol could replace MTBE, which delayed MTBE's removal from California's gasoline by several years. Only after many wells in California were contaminated, did they support its removal.

Already there are 235 ethanol plants under construction or in planning stages across the county, in addition to 111 operating plants. And there just isn't enough corn to go around. If all the scores of factories under construction or planned go into operation, they will gobble up no less than half of the entire corn harvest by 2008.

Even though last year's corn harvest was the third largest crop ever, food prices are rising in the supermarkets. Hog and cattle farmers are already bringing their animals to market early in an effort to save money on feed because the cost of a bushel of corn has doubled since September of 2006. As the price of grain goes up, people will go hungry. There were riots in Mexico in June because people were not able to afford corn for tortillas.

State Senator Tom McClintock (R) summed it up as follows: "The CARB regulations [to enforce the low carbon fuel standard] will undoubtedly hit Californians hard-but they will hit starving third world populations even harder. Basic foodstuffs are a small portion of the family incomes in affluent nations, but they consume more than half of family earnings in third world countries."
The Federal Government subsidizes major agribusinesses, such as ADM and Cargill, to grow corn. It also provides funds to build plants, and the refiners are given $0.51 cents a gallon for blending ethanol into our gasoline. Now these same agribusinesses want California's citizens to also pay more at the pump and supermarket by legislating additional subsidies in AB118.

A gallon of ethanol is less expensive than gasoline because of its subsidies, but we pay exactly the same amount for it at the pump. The oil companies profit by selling us a gallon of less expensive fuel for the same amount per gallon that we are now paying for gasoline. And we get less gas mileage from that gallon of ethanol, so we have to purchase more gasoline to drive the same number of miles. Everywhere the money flows out of our pockets into theirs.

Alternative energy for transportation does not have to be liquid fuels. PV panels will supply energy for 25 or more years with very little maintenance for plug-in hybrid vehicles. Any crop that is grown for ethanol requires energy inputs annually, for growing, processing and distribution. Rather than subsidizing corn ethanol, we should have programs to place solar panels on the top open air layer of parking garages for plug-ins, and devote more funds to public transportation. Let the Venture Capitalists who are seeking subsidies risk their own funds to research better non-food crop solutions and bring them to market when they are ready.

Juliette Anthony, M.A., M.S., Consultant
Sept 19, 2007

[dasv] 18/9/2007 12:34

US administration doesn't want to be held to ransome by Venezuela, Russia or Opec, hence encouragement of ethanol producers. Only have a small amount on these, and I'm happy to wait a couple of years to see how this pans out. My personal opinion is that the likely financial results won't be nearly as bad as the share price makes out.

[bpoole] 18/9/2007 10:55

It seems directors are buying in most of the ethanol stocks.

[volsung] 14/9/2007 17:41

Ethanol is an environmental disaster. 20p max by end of month