POET is now selling Voilà™ corn oil from POET Biorefining – Hudson (S.D.) into biodiesel and feed markets, and its success has prompted POET to start plans for rolling out its patent-pending production to its other plants. The rollout schedule is still being set, but the company will begin installation this year on the first plants.
POET’s specific brand of corn oil is different thanks to the low-energy BPX fermentation process (“cold-cook”), which eliminates heat from fermentation. When corn oil is captured on the back-end of that process following BPX, it is a higher-quality product with a lower amount of free fatty acids.
SEE HERE
SkunK
Tuesday, April 12, 2011
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Didn't we already know that back-end corn oil extraction provided a better product than front-end, but there were other issues with the back-end process that made it less desirable? Or did I just dream this?
I don't care if they drop chunks of ice into their fermentation tanks. Poets pending patents will never be issued because the process is still using a centrifuge to extract oil from stillage. Cold cook fermentation is great but Greenshift's issued patents cover all extraction from stillage, regardless of the temperature of the beer.
Voila is giving me Deja vu and reminds me that all attempts to go around the patents have failed. Poet has tried in the past, but just like Floettweg and ICM, these pending patents will be denied and determined to be obvious in light of Greenshift's issued patents.
The lack of heat in the fermentation process doesn't change the methods of extracting from stillage.
Nice try though Poet. Go ahead and rack up all the royaltys you want.
Maybe they're after a patent for the "cold cook" production and not corn oil? Maybe POET will be part of the 1.3 billion in licenses? Just saying maybe they're our friend and not our enemy?
I've been reading their patent application in more detail.
https://docs.google.com/fileview?id=0B_ch8gAs4lCcNzY3ZjMyN2MtZjJiNi00YmMyLWI5ZDYtYmUzNTcyMTcxODJh&hl=en&authkey=CKKG3OMI
My understanding is that they're extracting after fermentation, from the beer, before distillation. The use of NAOH or KOH is lowering the fatty acids, which can easily be done to oil extracted from stillage as well.
In other words, oil extracted from the fermentation beer is the same oil from stillage. Both can be pre-stripped with lye before made into biodiesel, and they'll have the same lower FFA's. You've got to compare apples to apples. Of coarse the FFA levels will be lower when stripped with KOH/NAOH. You can't claim it's higher quality when you're adding an ingriedient to neutralize the FFA's. The FFA's can be neutralized in the same way regardless of if it's extracted from the beer or from the stillage, they'll both have lower FFA's. But to say it's a better oil is kind of silly, it's the same oil. In that case, one could argue that oil from stillage, hit with lye, is higher quality than oil from beer that's not hit with lye.
It looks like the lines are drawn in the sand. Greenshift owns the issued patents to oil extracted from stillage. Poet's application is pending for oil extracted from the fermentation beer. It sounds like both are isolated to a different step in the production of ethanol.
The Good News...
The difference I'm seeing in the two methods is that Poet is predicting 3.5% extraction rates.(60MGY from 1.7B gallons of ethanol)
Greenshift has proven 4% and method II, 6.5%. So we may hold the upper hand here, forcing Poet to extract from a lower yielding part of the process(From anything but stillage).
The lower FFA/higher quality is smoke and mirrors and a non-issue.
I can see a future of both methods being extremely important to the industry.
I don't mind being in competition with Poet, the largest producer in the world, that's an honor! I think we have the better process. But it just goes to show that contrary to what ICM thinks, the methods of extracting oil are patentable. ICM and the other infringers are still on the hook for hundreds of millions of dollars because they extracted from stillage for many years. Maybe ICM should tell Poet it can't be patented, LOL.
This explains why GPRE licensed with GERS.
Good Luck To All!
Slashnuts,
Care to comment on US Pat# 7,915,458? Looks to me like Flottweg has an oil from syrup patent.
What about the fact that POET is deeply financed by private investors and the Feds. Do you think that will have an impact on ability to compete with the COES process?
I looked at the Flottweg site. Impressive technology. They mention everything but corn oil though. Olive oil, algae, fruit peels. Just about everything can be converted to biofuel. Just found it odd that they didnt mention corn oil. Maybe I missed it.
A second 10-K/A issued for ESYR. Two in a few days. More than housekeeping, has implications for GERS.
IS THIS A REASON FOR CONCERN? i WAS HOPING TO GET POET AS A CUSTOMER ON THE BASIS OF GPRE BEING OUR CUSTOMER.
Gpre went with gers cause it's the best tech out there and they're way ahead of Poet as far as having them installed. Poets limping behind playing catch up.
Whether extraction rate is 4% or 3.5% only part of the issue.
The real question is ... what is the profitability of each process, after royalties?
Also, will POET be selling this to other companies? Or, just using it internally?
If they aren't selling it, then it won't compete in the rest of the market. If they are, then it will compete.
May affect pricing of COES licenses.
Most important issues going forward ...
1. What does VLO do, with regard to COES?
2. What does ADM do?
3. What does GE do?
GE sells biofuel jet engines. They have a synergistic strategic interest in seeing this industry grow, and they have a stated strategy of investing heavily in this direction.
Further, they almost made a $38 Million equity investment into GERS back in 12/2008.
Will they come back to the table?
Skunk,
If you could use your good offices with GERS to obtain clarification of the unusual market activity that has occurred this year it would be very helpful to many of us.
I can tell ya right now Poet is gonna get sued. they're talking about extracting from stillage and they want a patent just because they don't use heat to ferment the corn? That ain't gonna fly. That's obvious and not novel. Extracting from stillage is extracting from stillage and there's no way around it without a license.
Anony,
Maybe that explains this morning's trading. KK needs more cash for a another retainer.
R/S is the biggest concern for us invetors. GERS seems like a bottomless black hole. Worrying about another r/s coming soon,maybe two more? About another 2b has been dumped these few days.
We are deluted.
It says the 'patent-pending cold-cook BPX fermentation process' that sounds new to me but the process of extracting the oil is not new, it's well known and patented. A patent for BPX, sure, a patent for the oil, not. Fermentation and oil extraction are two different things. If someone wants to license the BPX, that's fine, they'll have cleaner oil. But if someone wants that oil out, they'll have to license that process too. Poet didn't invent anything new in regards to oil extraction, only this BPX. This does not give Poet a free pass on oil extraction. They may have invented a better way to make ethanol but GS Cleantech figured out how to get the oil out of the DDGS a long time ago.
“Initially, I thought, ‘This oil from the syrup in our standard-setting Dakota Gold® distillers dried grains with solubles (DDGS) is really good. We just have to figure out how to get the corn oil out of the DDGS syrup and find a higher-value co-product use for it,’” Dr. Jason Bootsma, Senior Development Engineer for POET, says. “By using the BPX process and capturing the corn oil in the back-end, the oil is not damaged by the heat from cooking. The result is a higher quality, lower free-fatty acid corn oil that is an easier material to process and of more value to customers and producers alike,” Bootsma explains.
That's probably why they're not trying to sell it to the rest of thee industry. They don't have a patent to license it under. GERS is still the only legal way.
OMG - Reverse Split! That is crazy. Does anyone knows how many times this has happened?
The data on R/S activity with GERS is:
Capital Change=shs decreased by 1 for 20 split. Pay date=10-21-03.
Capital Change=shs decreased by 1 for 50 split Pay date=12/12/2007.
Capital Change=shs decreased by 1 for 10 split. Pay date=08/10/2010.
IMO, if they R/S again, they will wipe out the few remaining supporters they have. The market conditions have produced the perfect storm for GERS in 2011. If the management team cant produce solid results in 201, then there is nothing to expect here. GLTA
R/S = no big deal. undervaled market cap will remain the same
R/S if it happens will be different this time it'll be a good thing cause we are profitable
When is it ever a good thing to have your investment cut in half or worse??? You must be an insider, b/c the rest of the GERS supporters are fed up and frustrated with the lack of company news and R/S talk. I say again. R/S, another name change, any more of the same old same in these near perfect market conditions will spell SCAM not GERS.
I thought the CEO was going to cancel 10B shares, not R/S? He seems like KK is trying to turn things around. Canceling the 10B like he said he would prove GERS has turned the corner and is heading for profits and shareholder value in 2011.
Too many anonymoii, come out from behind the curtain.
How much can this company make if they get oil from all 2 1/2 billion of ethanol going? How much money will we get from lawsuits?
Is it true this company is the only one to get this oil patent?
A commenter said
"When is it ever a good thing to have your investment cut in half or worse???"
A r/s by itself will not cut the shareholding at all. In fact the day after the r/s you hold exectly the same value as the day before, just in different denominations. The erosion of value comes from what happens after the r/s. The reason for its use by GERS in the past has been so that the clock has been reset for YAGI to comitinue to convert debt into equity. If this drives the r/s then very quickly the valuation will drop. If it is for other reasons, such as to encourage investors to buy at a higher share price then it can have positive results.
Q410 revenues of about $2.7 million were higher than Q1,Q2 and Q3 of 2009, combined.
Q410 revenues increased by 110% compared to Q409.
Revenue surged 57% in 3 months, Q410 compared to Q310.
THESE REVENUES INCLUDED ONLY 5 MILLION POUNDS OF CORN OIL FROM GPRE IN Q4. GPRE WILL EXTRACT AT LEAST 30 MILLION POUNDS PER QUARTER WITH ALL PLANTS ON-LINE.
So we're about to see a 500% increase in GPRE's extracted oil in the coming quarters.
For this reason, I believe Q111 revenues will be higher than all of 2009's revenue.
If prices remain high, I think that somewhere between Q2 and Q3, revenues will be higher than all of 2010's, in only a 3 month period.
All GPRE systems will be complete in the NEXT MONTH or so except for the MN plant which will be sometime in Q3.
I love the fact that the report was on time and much improved, debt reduction will be reflected in Q1's report, 40% of the 10 billion have been cancelled, Calgren and Marquis, WI, are coming on-line, and another $7 million in debt will be gone in the next month or so.
"...we do not anticipate that we will to have rely on proceeds from financing activities completed with these and other investors given our expectation that we will produce sufficient cash flows from operating activities on an ongoing basis to cover all of our overhead needs moving forward."
I think the $3.60 per gallon was the price in Q4, it's holding at well over $5 now.
Great post slash, do you believe that the 40% cancelled is already reflected in the o/s (15b) or will that be reflected in the 1q11 report?
That's a good question that I was wondering myself, since the debt reduction wasn't reflected in the report either. The debt reduction and share cancellation are tied together, maybe they'll both be realized in the Q1 report? I'm just not sure. I do think the remaining 6B will be reduced or gone in conjunction with the $7M in debt by the end of this quarter.
Slash,
Where did you get the info that 40% of the 10B is cancelled? I know of only 2B.
Thanks
Neil
It's between pages 54-55 of the 10-K
"During the year ended December 31, 2010, 8,920 shares of Series D Preferred Stock were converted into 10 billion shares of Company common stock by Viridis Capital, LLC, the majority shareholder of the Company, its sole member, Kevin Kreisler, is the Company’s chairman, of which 4 billion shares have subsequntly been cancelled."
http://www.sec.gov/Archives/edgar/data/1269127/000126912711000016/gers10k2010.htm
HOW DID I MISS THAT! thanks Slash (and KK!)
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