Gevo, Inc. Provides Company and Project Updates (2022)

ENGLEWOOD, Colo., June 27, 2022 (GLOBE NEWSWIRE) -- Gevo, Inc. (NASDAQ: GEVO) (“Gevo” or the “Company”), a renewable fuels company focused on the production of sustainable aviation fuel (“SAF”), today provides updates on the Company and projects currently in process.

Follow-on Equity Offering
On June 5th, 2022, the Company executed a registered direct offering of 33.3 million shares to certain institutional investors. That offering closed on June 8th, 2022, and the net proceeds of $139.2 million combined with the Company’s existing cash, cash equivalents, restricted cash and marketable securities provide the Company with approximately $555.7 million of liquidity (as of June 15, 2022) to fund future operations and capital projects. As part of the offering, the Company issued 33.3 million Series 2022-A Warrants with an exercise price of $4.37 per share. If all 33.3 million Series 2022-A Warrants were to be exercised in cash at the exercise price of $4.37 per share, the Company would receive additional net proceeds of approximately $145.7 million.

The recent offering has further strengthened the Company’s balance sheet, which is expected to facilitate the financing of the Company’s Net-Zero 1 project (”NZ1”) and provide financial resources for the Company’s numerous growth opportunities. Given the forecasts of a recession in the near future and a generally negative market outlook, the Board of Directors made the decision to raise equity capital to ensure to the highest probability that Gevo has enough cash on hand to close its NZ1 financing, even if Gevo is responsible for 100% of the equity in the project. Gevo is in the process of developing additional plant sites to meet demand under its existing SAF and hydrocarbon supply agreements, and some of the proceeds are expected to be used to advance those efforts.

Market Development
Gevo now has more than 200 million gallons per year (“MGPY”) of predominantly take-or-pay, financeable SAF and hydrocarbon fuel supply agreements, which are expected to support project debt financing. This level of demand would require three additional plants of equal size to the expected capacity of NZ1 (currently expected to be approximately 55 million gallons per year) to be built over the next four years to satisfy those agreements. Based on current market projections, collectively, these agreements represent approximately $1.2 billion in expected sales per year.

Net-Zero 1 Status
Gevo’s NZ1 project is on schedule with initial volumes of SAF expected to be delivered in 2025 to fulfill a portion of existing SAF and hydrocarbon supply agreements. NZ1 is expected to produce approximately 55 MGPY of SAF or 62 MGPY of total hydrocarbon volumes, which would satisfy part of the 200 MGPY of financeable SAF and hydrocarbon supply agreements that are currently in place.

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The transition to an ethanol-to-SAF design from Gevo’s original isobutanol-to-SAF and isooctane design has resulted in an expected increase of output capacity which should result in increased cash flow. Gevo’s engineering design work to date has resulted in an expected 35% uplift in hydrocarbon output and a 22% expected uplift in co-product volume. These higher projected volumes suggest a 33% improvement in project EBITDA1, or an expected increase from $150 million per year to $200 million per year of project EBITDA when comparing the two designs.2The difference in capital cost between the two designs is negligible; however, the uplift in volumes associated with the ethanol-to-SAF design leads to increased cash flows per unit of capital invested.

Key NZ1 development milestones
Through year-end 2022:

  • Close the purchase of the land for NZ1 in Lake Preston, South Dakota
  • Execute commercial development, build, own and operate agreements for:
    • Water
    • Wind energy
    • Green hydrogen
  • Select engineering, procurement and construction (“EPC”) contractor
  • Select fabricator for hydrocarbon plant modules
  • Substantial Completion of Front End Engineering Design
  • Break ground and begin site preparation at Lake Preston
  • Order long lead equipment

Through first-half 2023:

  • Close the construction financing, including non-recourse debt

Throughout the remainder of 2022 and 2023, Gevo will update stockholders about certain key milestones related to the development, financing, and construction of NZ1. Updates to those milestones will be found in the Company’s press releases and investor presentations in the IR section of Gevo’s website.

Additional Plant Sites
The Company is in the process of identifying and performing early site development work for additional SAF production locations. These sites include several greenfield locations that are particularly advantageous in terms of potential economics, opportunities to decarbonize, and time to market. Gevo is also pursuing prospects with several existing ethanol plant sites, including those of ADM. Existing ethanol plants need to be decarbonized with renewable energy or de-fossilized energy and/or carbon sequestration. Gevo has developed a preferred list of partners and sites with decarbonization in mind and is engaged in preliminary feasibility and development discussions with several of them, including ADM.

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RNG Project Status
Gevo’s renewable natural gas (“RNG”) project in Northwest Iowa (the “RNG Project”) has been producing biogas and is now upgrading and injecting RNG into the natural gas pipeline. The RNG Project generates renewable natural gas captured from dairy cow manure. The manure for the RNG Project is supplied by three dairy farms located in Northwest Iowa totaling over 20,000 milking cows. When at full operational capacity, the RNG Project is expected to generate approximately 355,000 MMBtu of RNG per year, which will be transported and sold in California. BP Canada Energy Marketing Corp. and BP Products North America Inc. (collectively, “bp”) will market the RNG in California on behalf of Gevo, and Gevo expects that the RNG Project will generate between $16 and $22 million of Project EBITDA1per year beginning by 2023 depending on a variety of assumptions, including the value of credits under the federal Renewable Fuel Standard Program (“RFS”) and the Low Carbon Fuel Standard (“LCFS”) in California. Gevo expects to be able to get approval for Renewable Identification Numbers (“RINs”) through RFS and carbon credits from LCFS later this year or next year.

Verity Tracking
Verity Tracking is developing the tools, techniques, software, data access to track carbon score and other sustainability attributes using “blockchain” technology. The benefit is having audited, transparent, immutable sustainability data attached to biofuels and is expected to be valuable to our customers, colleague companies, and partners. Verity has continued to develop 3rd party partnerships that will contribute to its development objectives over the coming quarters. Gevo and Blocksize-Capital have identified a series of internal milestones that Verity will need to achieve over the next few quarters in order to develop into a stand-alone business unit, either as part of Gevo or as a separate entity.

Chevron
The letter of intent between Gevo and Chevron that was signed in September of 2021 and scheduled to expire on March 31, 2022, has been extended until August 31, 2022. Chevron has a strong interest in Gevo’s isobutanol-to-SAF, isobutylene and isooctane technology. Chevron and the Company have mutually agreed upon an extension that allows discussions and negotiations to continue.

Management Comment
Dr. Patrick Gruber, CEO of Gevo commented, "While this has been a productive quarter and year-to-date, the financial markets have been chaotic. Our recent decision to issue equity was made to ensure Gevo’s balance sheet could withstand the challenging financial markets that we expect over the next two years while continuing to move forward with our NZ projects. As we move closer to FID and financial close on the debt component for NZ1, it should be clear to investors that Gevo has the capital needed to execute its development plan and that the value proposition of the SAF that will be produced by NZ1 is remarkable. Over time, as demand from the aviation industry continues to exceed supply, there should be opportunities for early movers, like Gevo, to create additional, accretive partnerships that will benefit our stockholders.”

Upcoming Investor Conferences
Presentations provided in conjunction with these events will be available on Gevo's website at www.gevo.com in the Investor Relations section on the morning of the respective presentation. Members of Gevo’s senior management will participate in the following hosted investor events:

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About Gevo Inc.

Gevo’s mission is to transform renewable energy and carbon into energy-dense liquid hydrocarbons. These liquid hydrocarbons can be used for drop-in transportation fuels such as gasoline, jet fuel, and diesel fuel, that when burned have potential to yield net-zero greenhouse gas emissions when measured across the full lifecycle of the products. Gevo uses low-carbon renewable resource-based carbohydrates as raw materials and is in an advanced state of developing renewable electricity and renewable natural gas for use in production processes, resulting in low-carbon fuels with substantially reduced carbon intensity (the level of greenhouse gas emissions compared to standard petroleum fossil-based fuels across their lifecycle). Gevo’s products perform as well or better than traditional fossil-based fuels in infrastructure and engines, but with substantially reduced greenhouse gas emissions. In addition to addressing the problems of fuels, Gevo’s technology also enables certain plastics, such as polyester, to be made with more sustainable ingredients. Gevo’s ability to penetrate the growing low-carbon fuels market depends on the price of oil and the value of abating carbon emissions that would otherwise increase greenhouse gas emissions. Gevo believes that its proven, patented, technology enabling the use of a variety of low-carbon sustainable feedstocks to produce price-competitive low carbon products such as gasoline components, jet fuel, and diesel fuel yields the potential to generate project and corporate returns that justify the build-out of a multi-billion-dollar business.

Gevo believes that Argonne National Laboratory GREET model is the best available standard of scientific based measurement for life cycle inventory or LCI.

Important Cautions Regarding Forward Looking Statements

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Certain statements in this press release may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to a variety of matters, including, without limitation, Gevo’s financial condition as of June 15, 2022, Gevo’s business development activities, Gevo’s ability to the commercialize its projects, Gevo’s supply agreements, financial projections, whether any of the Series 2022-A Warrants will ever be exercised and the amount of proceeds Gevo may receive in connection therewith, Gevo’s ability to successfully develop, construct and finance its projects, whether Gevo’s supply agreements are financeable, Gevo’s ability to achieve cash flow from its planned projects, Chevron and whether Gevo and Chevron will enter into binding, definitive agreements and other statements that are not purely statements of historical fact. These forward-looking statements are made based on the current beliefs, expectations and assumptions of the management of Gevo and are subject to significant risks and uncertainty. Investors are cautioned not to place undue reliance on any such forward-looking statements. All such forward-looking statements speak only as of the date they are made, and Gevo undertakes no obligation to update or revise these statements, whether as a result of new information, future events or otherwise. Although Gevo believes that the expectations reflected in these forward-looking statements are reasonable, these statements involve many risks and uncertainties that may cause actual results to differ materially from what may be expressed or implied in these forward-looking statements. For a further discussion of risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to the business of Gevo in general, see the risk disclosures in the Annual Report on Form 10-K of Gevo for the year ended December 31, 2021, and in subsequent reports on Forms 10-Q and 8-K and other filings made with the U.S. Securities and Exchange Commission by Gevo.

Company Contact:
John Richardson (Director of Investor Relations)
Gevo Inc.
Tel 720-360-7794
E-mail: IR@gevo.com

1 Project EBITDA is a non-GAAP financial measure that we define as total operating revenues less total operating expenses for the project.
2 Under similar long run market price assumptions for key modeling inputs such as corn, SAF, co-products, and environmental benefits.

Gevo, Inc. Provides Company and Project Updates (1)

FAQs

What does the company Gevo do? ›

Gevo is focused on converting sustainably grown raw materials, specifically no. 2 dent corn, into high-value protein and isobutanol, a primary building block for renewable hydrocarbons, including sustainable aviation fuel, renewable gasoline, and renewable diesel.

What kind of company is gevo? ›

Gevo, Inc. operates as a renewable fuels company. It operates through four segments: Gevo, Agri-Energy, Renewable Natural Gas, and Net-Zero. The company commercializes gasoline, jet fuel, and diesel fuel to achieve zero carbon emissions, and reduce greenhouse gas emissions with sustainable alternatives.

Who does gevo have contracts with? ›

Agreement valued at approximately $2.75 billion over five years. ENGLEWOOD, Colo., July 22, 2022 (GLOBE NEWSWIRE) -- Gevo, Inc. (NASDAQ: GEVO) is pleased to announce a new fuel sales agreement with American Airlines, Inc.

Does gevo have a product? ›

Gevo's product line focuses on decarbonization of the process to give our high-protein animal feed the lowest carbon levels in its life-cycle inventory (LCI) as possible.

Is GEVO a good company? ›

Gevo has received a consensus rating of Buy.

What can I expect from GEVO stock? ›

GEVO Earnings Date

Gevo, Inc. is expected* to report earnings on 11/08/2022 after market close. The report will be for the fiscal Quarter ending Sep 2022. According to Zacks Investment Research, based on 3 analysts' forecasts, the consensus EPS forecast for the quarter is $-0.06.

Is GEVO producing fuel? ›

To make its energy-dense liquid hydrocarbons, Gevo uses low-carbon renewable resource-based carbohydrates as raw materials and is developing renewable electricity and renewable natural gas for use in production processes, resulting in low-carbon fuels with substantially reduced carbon intensity.

What does GEVO stand for? ›

Acronym. Definition. GEVO. Autonomic Computing and Grid Enabled Virtual Organizations. Copyright 1988-2018 AcronymFinder.com, All rights reserved.

Does GEVO have a plant? ›

Gevo's plant in Luverne, Minnesota, is situated among the cornfields. After all, it's an ethanol plant that was built to capitalize on the government regulations that encourage the use of ethanol blendstock in gasoline. We've modified this plant to produce isobutanol.

Who owns the most Gevo stock? ›

Top 10 Owners of Gevo Inc
StockholderStakeShares owned
SSgA Funds Management, Inc.15.02%35,309,857
BlackRock Fund Advisors7.69%18,078,479
The Vanguard Group, Inc.4.55%10,709,367
BlackRock Advisors (UK) Ltd.2.54%5,974,623
6 more rows

What is Jet AA fuel? ›

JET A-1 is a kerosene-type fuel. It is compatible with most jet aircraft, both civil and military, helicopter turbine engines, turboprops and compression-ignition piston engines. It has a boiling point of 150°C-250°C, a flashpoint over 38.0ºC (100ºF) and a maximum melting point of -47.0ºC.

Which company makes sustainable aviation fuel? ›

Gevo announced a new fuel sales agreement with American Airlines, Inc., which sets forth the terms for the sale of 100 million gallons per year of sustainable aviation fuel for a five-year term. Gevo's future commercial operations are expected to fulfill the order and delivery is expected to begin in 2026.

Is Chevron buying gevo? ›

The transaction has been approved by the Boards of Directors of both companies and is expected to close in the second half of 2022. The transaction price represents a premium of around 57% on a 30-day average based on closing stock prices on February 25, 2022. The acquisition is subject to REG shareholder approval.

Who makes sustainable aviation fuel? ›

World Energy is a major SAF supplier in the US. The company, which has been a leader in the production and distribution of low-carbon fuels for more than two decades and operates the world's first and America's only commercial-scale SAF production facility, plans to produce 150 million gallons of SAF per year by 2024.

Should I buy Gevo stock right now? ›

Gevo holds several negative signals and we believe that it will still perform weakly in the next couple of days or weeks. We, therefore, hold a negative evaluation of this stock.

Should I invest in Gevo stock? ›

Its Value Score of F indicates it would be a bad pick for value investors. The financial health and growth prospects of GOEV, demonstrate its potential to underperform the market. It currently has a Growth Score of F.

Will Gevo stock recover? ›

The average Gevo stock price prediction forecasts a potential upside of 450% from the current GEVO share price of $2.00. What is GEVO's Earnings Per Share (EPS) forecast for 2022-2024?

Is Gevo undervalued? ›

Gevo Inc retains a regular Real Value of $5.34 per share. The prevalent price of the firm is $2.0. Based on Macroaxis valuation methodology, the firm appears to be undervalued.

Is Gevo a meme stock? ›

I wrote about Gevo (NASDAQ:GEVO) in February 2021 when it was heading towards its meme-stock induced 52-week high. As a company that was, and remains, a pre-revenue company, I made a bearish call on GEVO stock. That proved to be the right call.

Should I hold Gevo? ›

USD 2.15 0.08 3.59% Given the investment horizon of 90 days and your above-average risk tolerance, our recommendation regarding Gevo Inc is 'Hold'.

Is GEVO producing fuel? ›

To make its energy-dense liquid hydrocarbons, Gevo uses low-carbon renewable resource-based carbohydrates as raw materials and is developing renewable electricity and renewable natural gas for use in production processes, resulting in low-carbon fuels with substantially reduced carbon intensity.

Will GEVO stock go up? ›

Stock Price Forecast

The 4 analysts offering 12-month price forecasts for Gevo Inc have a median target of 10.00, with a high estimate of 18.00 and a low estimate of 2.30. The median estimate represents a +350.45% increase from the last price of 2.22.

Does GEVO have a plant? ›

Gevo's plant in Luverne, Minnesota, is situated among the cornfields. After all, it's an ethanol plant that was built to capitalize on the government regulations that encourage the use of ethanol blendstock in gasoline. We've modified this plant to produce isobutanol.

What does GEVO stand for? ›

Acronym. Definition. GEVO. Autonomic Computing and Grid Enabled Virtual Organizations. Copyright 1988-2018 AcronymFinder.com, All rights reserved.

Is Chevron buying gevo? ›

The transaction has been approved by the Boards of Directors of both companies and is expected to close in the second half of 2022. The transaction price represents a premium of around 57% on a 30-day average based on closing stock prices on February 25, 2022. The acquisition is subject to REG shareholder approval.

Who owns gevo? ›

Top 10 Owners of Gevo Inc
StockholderStakeShares owned
The Vanguard Group, Inc.4.55%10,709,367
BlackRock Advisors (UK) Ltd.2.54%5,974,623
Sabby Management LLC2.33%5,486,831
Invesco Capital Management LLC2.18%5,117,436
6 more rows

Which company makes sustainable aviation fuel? ›

Gevo announced a new fuel sales agreement with American Airlines, Inc., which sets forth the terms for the sale of 100 million gallons per year of sustainable aviation fuel for a five-year term. Gevo's future commercial operations are expected to fulfill the order and delivery is expected to begin in 2026.

Is Gevo a good stock to Buy? ›

Is Gevo Stock a good buy in 2022, according to Wall Street analysts? The consensus among 1 Wall Street analyst covering (NASDAQ: GEVO) stock is to Hold GEVO stock.

Should I buy Gevo stock right now? ›

Gevo holds several negative signals and we believe that it will still perform weakly in the next couple of days or weeks. We, therefore, hold a negative evaluation of this stock.

Is Gevo a good stock to Hold? ›

The average price target represents 329.86% Increase from the current price of $2.21. What do analysts say about Gevo? Gevo's analyst rating consensus is a 'Strong Buy. This is based on the ratings of 3 Wall Streets Analysts.

When was gevo founded? ›

The company was founded by Christopher Michael Ryan, Matthew W. Peters, Peter Meinhold, and Frances Hamilton Arnold on June 9, 2005 and is headquartered in Englewood, CO.

When did gevo go public? ›

Gevo went public in 2011. At the time, there was considerable hype around the biofuel company.

What is a Tier 4 locomotive? ›

Tier 4 locomotives are compliant with the latest U.S. Environmental Protection Agency (EPA) emissions standards and will reduce particulate matter and nitrogen oxide emissions by up to 85 percent compared to older locomotives.

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