Aemetis discusses plans to upgrade Keyes plant

By Erin Voegele | March 30, 2018

Aemetis Inc. released fourth quarter 2017 financial results on March 29, highlighting progress with the development of its proposed 12 MMgy cellulosic ethanol plant and discussing plans to upgrade its existing corn ethanol plant.  

During an investor call, Eric McAfee, chairman and CEO of Aemetis, noted the company has achieved several milestones in the development of the Riverside cellulosic project. This includes the signing of a 55-year lease on for the plant site and signing a 20-year feedstock agreement with 10 years of fixed pricing for locally sourced orchard wood. In addition, key environmental permits for the plant have been secured and the company has satisfied key requirements for a $125 million USDA loan guarantee.

McAfee said Aemetis is currently responding to questions from the Office of Management and Budget prior to the issuance of a loan rating, which is the amount of funds that will be set aside in the USDA related to the Aemetis loan guarantee.

He discussed operations at the company’s Keyes, California, corn ethanol plant. He said the facility has been consistently operating at above nameplate capacity, with a current annual run rate of more than 61 MMgy. “Our focus on operational efficiency and cost reductions at the plant has reduced expenses for chemicals and enzymes significantly in the past year by changing vendors and adopting new products,” he said.

According to McAfee, Aemetis plans to complete upgrade projects at the Keyes plant over the next year. Those projects are expected to increase revenues, reduce costs, and reduce the carbon intensity (CI) of the plant’s ethanol. He said the upgrades are expected to allow the plant to achieve a 60 CI rating for its ethanol output, down from the current 68 CI rating.

McAfee also briefly discussed the pending acquisition of Edeniq, which is currently being litigated. He said the acquisition continues to move slowly, but indicated the company is confident in the validity of its case.

In addition to its ethanol projects, Aemetis also owns a biodiesel plant in India.

The company reported $38.9 million in revenues for the fourth quarter, up from $37.4 million during the same quarter of 2016. The increase is primarily attributed to increased ethanol production, from 14.6 million gallons in the fourth quarter of 2016 to 16.3 million gallons in the fourth quarter of 2017.

Gross profit for the fourth quarter was $302,000, down from $3.9 million during the same period of 2016. The decrease was attributed to softening ethanol prices.

Operating loss for the fourth quarter was $3.4 million, compared to operating income of $900,000 during the fourth quarter of 2016. Net loss was $9 million, compared to a net loss of $1.4 million during the same period of the previous year.

For the full year, Aemetis reported $150.2 million in revenues, up from $143.2 million in 2016. The increase is primarily attributed to increased production of ethanol and wet distillers grains.

Gross profit for 2017 was $3.4 million, down from $11.6 million in 2016. Gross profit decline was attributed to increase corn costs and the softening of the price of wet distillers grains.

Operating loss was $12.2 million for 2017, compared to an operating loss of $800,000 in 2016. Net loss attributable to Aemetis was $31.8 million for 2017, compared to a net loss of $15.6 million in 2016.