Representatives of Aemetis Inc. discussed the progress of the company's biogas, ethanol, cellulosic biofuel, and carbon capture and storage (CCS) programs during the third-quarter earnings conference call held on November 11.
Andy Foster, president of Aemetis Advanced Biofuels, highlighted the progress made by the company's biogas subsidiary. He said that Aemetis completed the first phase of its dairy digester project in September, and the first two covered lagoon digesters began operations, including on-site dairy biogas cleaning and pressurization. The first phase also includes the development of a 4-mile-long pipeline and a boiler installation to use biogas as a process energy source at the company's ethanol plant in Case, California. The use of biogas in an ethanol plant enables the plant to reduce the carbon intensity (CI) fraction of the ethanol it produces.
Foster said that Aemetis is currently working on the second phase of the dairy digester project, which includes a centralized biogas cleaning facility, a utility pipeline interconnection, and a renewable natural gas (RNG) refueling station at the Keyes plant. The second phase also includes the addition of 15 dairy digesters and 32 miles of pipelines. According to Foster, the second phase of development is scheduled to be completed in the third quarter of 2022.
So far, Foster stated that Aemetis has signed agreements with 22 dairy plants to install biogas digesters. In addition, the company is in in-depth discussions with five other diaries, and is expected to sign agreements on these digesters before the end of the year. According to Foster, Aemetis also held discussions with more than a dozen other dairy factories.
Regarding the operation of the Keyes ethanol plant, Foster confirmed that the plant is operating at full capacity. He also reported on the progress of several improvement projects the company is carrying out to further reduce the CI of the ethanol produced by the plant.
Foster said that the Mitsubishi Zebrex membrane dehydration system has now been fully installed and has reached the expected milestone. The system is expected to reduce the amount of steam used for ethanol dehydration by 75%. Foster said that the optimization of the system is currently in progress and is expected to be put into use in the first quarter of next year.
Aemetis also hopes to sign an EPC contract for a 1.5 megawatt (MW) solar system this month, which will further reduce the use of fossil energy at the Keyes plant. In addition, Foster added that EPC negotiations for the mechanical vapor recompression system are ongoing.
Eric McAfee, Chairman and CEO of Aemetis, discussed the development progress of the company's proposed Riverbank cellulose project. In the first phase of development, the facility is expected to produce 45 MMgy of renewable diesel and jet fuel, which will be expanded to 90 MMgy in the second phase. He highlighted the October agreement with CTCI to provide engineering design for the proposed facility and the 250 million gallon offtake agreement signed with Delta Air Lines in the third quarter.
McAfee also discussed the CCS project being developed by Aemetis' subsidiary. The first phase of the project aims to sequester 400,000 metric tons of carbon dioxide from the company's biogas, ethanol and cellulose plant operations in two wells, each with an annual production capacity of 1 million tons. Entering the second phase, the company will isolate additional carbon dioxide from refineries and other industrial sources in the area. The first of the two feature wells planned for the project is expected to be drilled in early 2022.
Aemetis reported revenue of US$49.9 million in the third quarter, higher than the US$40.9 million reported in the same period last year. The total loss was US$4.8 million, and the total revenue reported for the third quarter of 2020 was US$771,000. Operating loss was US$9.9 million, while operating loss was US$3.8 million. The net loss was US$17.6 million, compared with a net loss of US$12.2 million reported in the third quarter of last year.