A
Message from Charles Brettell
This week I want to take a
moment to comment on the future of the ethanol industry as I see it.
So, let's start here: The US ethanol
industry is here to stay. We can certainly argue about the
form of that industry – particularly whether corn-based ethanol will
prevail in the long run over domestic cellulosic or foreign sugar
cane-based ethanol – and what effect current GHG legislation will have,
among other things. But there's no plausible argument that ethanol of
some sort won't be part of the Nation's energy equation for the long run.
What does that mean for today's
beleaguered corn-based ethanol industry? It means there's a HUGE
buying opportunity – maybe that’s why you see so
few owners willing to entirely part with their assets or lenders unwilling
to discount their credits to appeal to the distressed investor set.
Think about it. If you 1) know that you can buy iron in the ground at
a discount to new construction / replacement cost, 2) believe that corn
ethanol is at least a bridge to the cellulosic future (assuming that
comes), 3) understand that a push toward least cost production is unlikely
to include reducing / eliminating tariffs on foreign-sourced ethanol and 4)
comprehend that if nothing else current ethanol facilities and participants
are likely to be the source for future ethanol developments, then it’s time to start buying. Just make sure you use
a firm that has built its entire practice around ethanol optimization and
management with the experience, independence and integrity to help you
separate the corn from the stover; of course, I’d suggest EAS!
As always, if anything here
stirs your imagination, feel free to contact me at your convenience at
bbrettell@energyassetsolutions.com.
In the interim, I look forward to seeing all our friends at the ACE
conference in Milwaukee , WI
from August 11th to 13th.
Cheers,
Bob
P.S. I'd be remiss if I
didn't mention that we still have a few seats available for our Asset
Optimization webinar on Wed., July 29th at 10:00 a.m. Eastern. To
register, just follow this link and the embedded instructions.
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Are your ethanol
assets keeping you up at night?
You’re not the only one.
Collapsing spreads, failed hedging strategies, falling fossil fuel prices
leading to workouts, foreclosures and bankruptcies. It's a tough time
for sure.
But nobody wins in a world where you
avoid the difficult decisions. It's time to take charge, evaluate
& preserve your options and start down the long road to
recovery & enhancement.
And whether you're an owner trying
to generate enough cash flow to meet your loan covenants or a lender
trying to determine if a project can make it, you need an experienced team
at your side to help you understand all your options - from the ground up.
The only question
now is what to do about it?
At EAS, we excel in helping owners & lenders
craft customized strategies & tactics to preserve and enhance the value
of their ethanol assets, regardless of technology, market conditions or
geography.
We understand that every asset has
a unique operating profile - after all, our team has handled every
management position in an ethanol facility, including plant management, lab
management, operations management and more. As a result,
our focus is uniquely centered on the operational elements of the
underlying facility. But we don't stop there.
Our analysis includes virtually
everything area you can control at an ethanol facility - including risk
management, marketing, finance, accounting & treasury, supply /
demand-side management and more - so that we can present you with
a suite of solutions stack-ranked by impact, cost, timing or
whatever criteria you choose.
Of course, not every asset can make
it - some are just too hard to pull back from the brink. If that's
the case, we can also deploy our skilled resources to assist in
shutdown & mothballing the asset in a way that
preserves & maximizes options for the future and ensures the
ability to restart when conditions become ripe for success.
How does EAS do
it? Simple: Ask, Listen, Solve!
Our proprietary methodology begins
with a simple question: “What's the best way to drive
incremental value for the asset?”
From there, our team
of experienced ethanol professionals work with you to determine your
end-game, incorporate your preferences, including risk tolerance, available
credit support, etc. and develop tailored solutions to get you where
you want to be.
Once we agree on the destination
and path, we offer you the option to have us implement your solutions, work
with your team to implement them or hand them off entirely for execution by
your team. Your choice.
So, if you've got an asset that
needs some extra attention, call EAS today to get started.
EAS. Experienced
. . . Optimal . . . Solutions.
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