Biofuels Venture in crisis? Check samples, suing, extraction technology

December 18, 2012 |

Investors, policy-makers, supply-chain partners, observers – so many stakeholders ask the same question – how do you really know when your favorite biofuels venture is having real trouble as opposed to a non-material slowdown or hiccup.

But not every venture is far enough along or transparent enough to offer classic data for analysts or the adventurous private investor.

How do you tell – what are some tell-tale signs that, from the outside, can tip you off that you “got trouble, right here in River CIty.” Let’s look at 12 Signs, 10-12 below.

10. Samples available?

Perhaps the best way to check. Can you sent over a half ton of biomass – goes the request to the algae firm. Or some gallonage of fuel samples from the processor. If they can’t fulfill, and you are not asking in a completely irresponsible too-early-to-be-reasonable way, you can be sure that providing samples for testing was in the plan, and shortfalls can mean that the process is running wayyyyy toooo slowwww, or that separation is not working well, or that money is running low.

11. Anyone suing?

If your fave venture is getting sued on its patents, trade secrets or other IP, it’s not entirely a bad sign. Could be that a competitor is suing to slow down the front runner and close a technology gap. Could be that the technology is that white-hot. If no one is suing and it is a highly competitive field where there have been people hopping around – could be a sign that its technologies are defensible, could be that they are nothing to write home about.

But RIN-related allegations, permitting problems, financing meltdowns, shareholder suits. Keep an eye on the legal front and you may well save yourself some hertbreak later on.

12. Buying centrifuges, hexane.

Using expensive and old-world extraction techniques like centrifuges and hexane – hmmm, well that is tough to make work because of the high cost of energy to move water around, and the high costs of the solvents. Not a concern if that’s the technology at the lab, or really at the pilot. Worry if the centrifuge salesman is making deliveries to a demo plant – could be signs that the more innovative extraction process is not working and that precious fuel is sitting in concentrations of milligrams per liter.

Wait! There are more signs. Check them out.

EXTENSION: Biofuels Venture in crisis? Check layoffs, project delays, truck counts

EXTENSION: Biofuels Venture in crisis? Check staff ratio, milestone payments, downtime

EXTENSION: Biofuels Venture in crisis? Check ordering, design changes, capacity reductions

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