Gevo Inc (NASDAQ:GEVO) shares rose 3.23% on Tuesday and an additional 3.39% to $3.97 in after-hours trading. Share prices have been trading in a 52-week range of $3.20 to $27.20, indicating that price is bouncing off its lows. The company has a market cap of $25.25 million at 6.82 million shares outstanding.
Gevo Inc is a renewable chemicals and next generation biofuels company that has developed a technology that uses a combination of synthetic biology, metabolic engineering, chemistry and chemical engineering to focus primarily on the production of isobutanol, as well as related products from renewable feedstock. The company has two operating segments: the Gevo, Inc. segment and the Gevo Development/Agri-Energy segment.
Its Gevo, Inc. segment is responsible for research and development activities related to the future production of isobutanol, including the development of its biocatalysts, the production and sale of biojet fuel, its Retrofit process and the next generation of chemicals and biofuels that will be based on its isobutanol technology. Its Gevo Development/Agri-Energy segment is responsible for the operation of its Agri-Energy Facility and the production of ethanol, isobutanol and related products.
In a press release yesterday, Gevo Inc announced that the U.S. Environmental Protection Agency has approved the pathway for isobutanol produced at the company’s Luverne plant to be an advanced biofuel under the Renewable Fuel Standard Program. This marks the first time that the EPA has approved a pathway for an advanced biofuel that uses starch from feed corn to produce an alcohol. According to the pathway approval, Gevo Inc should be able to achieve the 50% or greater greenhouse gas emissions reduction needed to claim the advanced D5 Renewable Identification Number.
The Renewable Identification Number or RIN is a serial number assigned to biofuels for the purpose of tracking their production, use and trading, as required under the Renewable Fuel Standard or RFS. These can be sold and traded, and as a result carry a monetary value, which is linked to the biofuels that generate the RINs.
The new EPA pathway combines the lowest cost carbohydrate feedstock sources with green energy, resulting in advanced fuels with a significant GHG reduction. It is worth noting that this pathway leads to the only advanced biofuel that has potential to significantly lower GHG’s while also generating large amounts of protein for animal feed. In fact, practically all of the protein from the feed corn used by Gevo is captured and sold for animal feed. This feed corn, which is not used for human consumption, and which is supplied to Gevo in Luverne is what the local farmers are calling “low carbon corn” because of the advanced farming techniques they use to minimize chemical inputs, the low till/no till fields that are building up soil carbon and the high yields that they achieve which minimizes land use. We are pleased that there is now a route for advanced fuels that provides protein that contributes to the food system. We expect that the approval of this pathway will open up new business opportunities for Gevo, while driving sustainable environmental improvements,” said Dr. Patrick Gruber, Gevo Inc Chief Executive Officer.
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