REG: Operations improving at Geismar facility
Renewable Energy Group Inc.
November 4, 2016
BY Erin Voegele
Renewable Energy Group Inc. recently released third quarter financial results, providing updates of operations at its Geismar renewable hydrocarbon diesel facility, its biodiesel operations, and other activities.
During an investor call, Daniel Oh, president and CEO of REG, said operations at the Geismar plant were mixed during the third quarter, but are steadily improving. The facility lost 10 days of production due to local area flooding in Louisiana in August. While the plant itself did not experience any flooding, he said, employees were unable to get to the facility. In addition, scheduled maintenance was pulled forward from October to September, resulting in an additional 27 days of downtime during the quarter. As a result, Oh said the facility will be running more than originally intended during the fourth quarter.
Advertisement
Advertisement
Since the maintenance turnaround was completed, Oh said Geismar has been running consistency at approximately 95 percent capacity. The plant produced 5 million gallons of renewable hydrocarbon diesel in October after coming online on Oct. 5, he added, compared to 7.1 million gallons produced at the facility during the entire third quarter. According to Oh, there is no planned downtime at the Geismar facility for the remainder of the year.
Overall, REG sold a total of 163.1 million gallons of fuel during the third quarter, up 36 percent. The company produced 114.8 million gallons of biomass-based diesel during the quarter, up 35.2 percent. The average price per gallon of biomass-based diesel increased by 22.2 percent, reaching $3.14, as a result of generally improving market conditions and reinstatement of the biodiesel mixture excise tax credit (BTC).
"We achieved solid growth in the third quarter with significant increases in gallons sold, gallons produced, revenue and adjusted EBITDA," Oh said. "REG Life Sciences delivered its first commercial product last week, our biomass-based diesel fleet is operating efficiently and profitably and REG Geismar is up and running well with no planned downtime for the remainder of the year. We believe we are positioned for a strong finish to the year."
Advertisement
Advertisement
Revenues for the quarter were $624.6 million. Gross profit was $47.3 million, compared to $4.4 million during the third quarter of 2015. Net income attributable to common stockholders was $22.9 million, or 59 cents per share on a fully diluted basis, compared to a net loss of $15.7 million, or 36 cents per share on a fully diluted basis, during the same quarter of last year.
Related Stories
The U.S. Department of Energy Bioenergy Technologies Office (BETO) announced up to $23 million in funding to support research and development (R&D) of domestic chemicals and fuels from biomass and waste resources.
The U.S. DOE has announced its intent to issue funding to support high-impact research and development (R&D) projects in two priority areas: sustainable propane and renewable chemicals and algal system cultivation and preprocessing.
Sens. Sherrod Brown, D-Ohio, and Pete Ricketts, R-Neb., in August introduced the Renewable Chemicals Act, a bill that aims to create a tax credit to support the production of biobased chemicals.
The Chemical Catalysis for Bioenergy Consortium, a consortium of the U.S. DOE’s Bioenergy Technologies Office, has launched an effort that aims to gather community input on the development of new biomass processing facilities.
USDA on March 8 celebrated the second annual National Biobased Products Day, a celebration to raise public awareness of biobased products, their benefits and their contributions to the U.S. economy and rural communities.
Upcoming Events
