As one of the world’s leading bio-refining companies, GTL Resources has beaten the odds and managed to stay viable in the ethanol markets throughout North America and around the world. Ethanol manufacturers have seen their stocks decline over the past few years as biofuels have gone out of fashion, but GTL is still going strong. As recently as June 15, 2011, GTL Resources reported that its 2011 full year financial results have exceeded expectations, perhaps indicating an increased demand for biofuel. As crude prices continue to hover around $100 a barrel, refined ethanol is getting a renewed look from many investors and industrial manufacturers.
London-based GTL Resources was founded in 2006 when green manufacturing was just beginning to take off. It is currently trading at lower than its initial AIM offering, but it has steadily risen since it hit bottom in mid-2009 in the wake of the global recession and lack of interest in biofuels. Recent positive earnings reports are likely to placate investors wary of entering the ethanol markets again, and its steady rise in stock value from an all-time low of under 9p to close to 75p in just one year may convince investors that now is the time to buy.
GTL Resources operates its main refinery just outside Rochelle, IL, in the heartland of the American Midwest. Corn grows in abundance here, making ethanol production easy and affordable. The company has also seen a number of favorable business incentives in the past few years, including a tax incentive extension in late 2010, partially as a result of lobbying after the oil disaster in the Gulf of Mexico. At the forefront of pressing for environmentally friendly legislation, investors and industry analysts predict that GTL Resources will continue to be a powerhouse of green industry for years to come.
Clean Energy Brazil is a British green investment company whose main sources of revenue come from the Brazilian sugar cane and ethanol markets. Initially begun in 2006 to take advantage of the growing biofuels market worldwide, the company has since changed course due to the lower demand for biofuel in the later half of the 2000s. Ethanol is still a huge market in Brazil, and of course sugar will always sell, but sugar cane biodiesel is not wanted as much. The name “Clean Energy Brazil,” therefore, is somewhat of a misnomer now, as the company’s offerings have less to do with energy and more to do with any and all sugar cane by-products.
The company has shown remarkable flexibility; this is the only reason it is still around now, due to the drying up of biofuel energy markets. Investors at Clean Energy Brazil believe that the retreat from biofuels is only temporary, and continue to make their company profitable though their end results only partly have to do with providing clean energy. Ethanol is still used as a power source, but it is not as widespread as it once was.
The stock was admitted to the AIM in 2006 and it saw a major dive when the rest of the stock market dove in 2008. It fell to nearly 20% of its initial value and hasn’t really picked up steam since then. Flatlining at around 15p per share, CEB is waiting for some good news about the increased viability of ethanol as a fuel or electricity source. This would push demand for sugarcane byproducts higher in Brazil and around the world, and the stock price would likely rise.
Investors should take note that Clean Energy Brazil is something to be aware of but not to invest heavily in for now. Biofuels-related news will cause the price of CEB to go up or down as appropriate.
D1 Oils was founded in 2004 as a renewable fuels producer. The company uses a species of tree known as jatropha to produce its refined biofuels. Jatropha trees are able to survive in a wide variety of climates, and its seeds are known throughout the vegetable world for their extremely high oil content.
Other biofuels manufacturers saw the price of food go up as a result of investment in technologies that turned edible oils into fuel. This led to worldwide hunger riots and the decline of the edible oils industry for use in biofuels. However, D1 Oils managed to avoid that bump because Jatropha oil is inedible and doesn’t affect food prices around the world.
In October 2004, D1 Oils was first listed in the AIM. Its initial offering raised 11.5 million pounds. Subsequent offerings raised 26 million, 49 million and 14.9 million pounds in 2005, 2006 and 2008, respectively. As Britain’s leading jatropha-based biodiesel manufacturer, D1 is poised for growth in the years to come.
In 2007, oil producer BP and D1 Oils formed a joined venture to plant more jatropha trees around the world. Jatropha trees can be grown in poor quality soil, making it exceptionally convenient as an oil crop. The company has collaborated with many different world-class companies over the past five years and it has consistently been a high performer in the biofuels market, both when it was doing well and in recent years, when many other biofuels companies have gone out of business or have had to restructure their goals.
In April 2011, Siemens sought to develop a high-speed ferry that ran solely on biofuels from jatropha seeds. This ferry could prove highly useful throughout Europe, Asia and the world at large, and is seen by D1 Oils as an excellent opportunity for growth. As more information comes out on Siemens’ ferry development, expect the price of D1 Oils to fluctuate on the Alternative Investment Market.
Biofutures began in 2006 as a biofuels company that intended to purchase up-and-coming biofuels manufacturers. It made its first acquisition in November 2006 when it acquired Zurex, a Malaysian manufacturer with a license to produce biodiesel from palm oil. Since its initial entry into the biofuels market, Biofutures has seen some success, but as global capital retreated from the biofuels market due to other environmental concerns, Biofutures was forced away from biofuels. In May 2008, Biofutures officially became an Investment Company. Its acquisitions include the energy and utility sectors throughout Europe, Asia and the Middle East.
True to its initial plan, Biofutures places special emphasis on companies with a potential share in the biofuels market. Though this market isn’t especially profitable, Biofutures’ current strategy is to maintain several plants around the world such as oil manufacturers with the capacity to produce biofuels easily, should the technology ever become economically viable once again.
For instance, the manufacturing plant in Zurex was paired with a refining plant in 2010 which produces refined palm oil for use in a variety of markets, including personal care products and food production. The refined oil which was once used as biodiesel can be used many other ways. Biofutures is a flexible investment company able to move with capricious market winds, and while the winds are currently blowing against it, the company maintains its viability.
Biofutures’ price on the AIM is especially low in light of the recent high price of palm oil. However, because the company is solid, flexible and capable of handling most problems, it offers a good investment opportunity for savvy investors. Should the price of palm oil go up due to increased demand for biofuels, for instance, Biofutures is expected to rise tremendously and be an excellent investment. Only time will tell how the company’s fortunes play out.