4 advanced biofuel plants for Argentina as Porta, Gevo announce deal

The latest in Gevolution

We reported last month that Alaska Airlines will buy 1,000 gallons of Gevo’s alcohol-based jet fuel for commercial flights set to begin later this year. It hasn’t yet decided how many flights will use the fuel or at what blend rate. Already the airline has run successful demo flights with the fuel. Alaska is Gevo’s first commercial customer. The use of Gevo’s fuel ties in with the airline’s plan it rolled out in December with Boeing and the Port of Sea-Tac to create a biojet hub.

Meanwhile, Praj and Gevo announced a monster hook-up here for converting ethanol distilleries to isobutanol.

Here’s the structure: Praj would be the customer-facing entity marketing Gevo’s isobutanol technology to Praj’s existing customer base, and would provide the engineering, procurement and construction services for such projects. Globally, Praj is one of the leading suppliers of EPC services to the ethanol industry, having provided such services to approximately 350 ethanol plants across 65 countries.

It’s a pretty good deal for both. Gevo potentially gets some new customers and Praj lands EPC work in deploying the isobutanol technology to its vast network of first generation ethanol plants. As previously announced, Gevo and Praj expect to license up to 250 million gallons of biobutanol capacity over the next ten years under this partnership.

Speaking of Praj, the relationship with Porta “is completely separate from the work we are doing with Praj,” Willis told The Digest. “With Porta, the expected feedstock is corn (like we are using at Luverne), and for plants beyond #1, we anticipate leveraging Porta’s own network of ethanol plant customer relationships. With Praj, the feedstock is expected to be primarily non-corn based feedstocks such as sugar cane, sugar beets and cassava. And of course, for any plant roll-out with Praj, we would try to leverage Praj’s network of existing customers.”

Gevo raises some cash

In December, we reported that Gevo closed a $10 million offering of common stock. Cowen & Company’s Jeffrey Osborne writes: Funds raised through the equity offering will be used to execute capex at the company’s Luverne facilities. After having settled ongoing legal issues with Butamax in the previous quarter, Gevo is poised to ramp up isobutanol production for use in the Specialty Chemical & Solvents, Marine, Off-road, AJT, and Iso-Octane markets, with terms of the agreement allowing each company to annually sell 30 million gallons of isobutanol into any end market with amounts beyond 30 million gallons subject to royalties.