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This seemed like a pretty good presentation:
http://www.ens.dk/da-DK/UndergrundOgForsyning/VedvarendeEnergi/bioenergi/bioanalyse/temamoder/Documents/Market%20and%20Price%20Projection%20for%20Wood%20Pellets_Wolfgang_Stelte_DTI.pdf
Phillip
I don't think the Company's statement that they are selling on the open market means that they won't sign agreements. My take on it is that their agreements just won't stipulate a fixed price, but may be tied to price index such as the Industrial Wood Pellets price index. They could cut deals offering a discount or premium to the index price particularly as they look for financing for future phases. If a power producer was willing to prepurchase so many tons of product at a 5% discount off of the index price, it could be a win-win.
Phillip
The article adds to the credibility of news releases we get from the Company. Interesting though the statement that the final lease will go before the Port. I was thinking about this this morning in that all of the options were with Biomass Secure Power according to the Port's agendas. If they were going to have the lease with their LLC, they would have to rectify that so sending the final least to the Port again makes sense.
Phillip
What you're both forgetting is that share issuance was 44,536,351 out of the 556,566,667 shares outstanding at the time. "If" that issuance was the only one (based on the previous post when someone asked Jim), then that only represents 7.41% of the company. I'm sure this could always change by issuing additional shares in the future, but my guess is that if there's any agreement in place for Drax to acquire a portion of the company it would have been reflected in the last share issuance. Then again, if the foward P/E were cranked out and Drax saw a future high valuation of 44,536,351 shares in a 3-4 year horizon one could argue that they are seeing the same wisdom as those of us who have invested in this company.
Phillip
Your silence is deafening. :)
Should I? :) He's been very careful about what he says which raises my curiousity even more. Am I getting warmer with my theories?
I'm assuming that there won't be any announcements until Drax gets approval from the Port on their option extension at the end of this month.
Phillip
I would gladly give up 5% of my equity in the company to get Drax as an investor. You may be able to hire competent people (which are hard to pay when you don't have any revenue), but if you get a company like Drax to make an announcement that they inked a deal with BMSPF, I can guarantee you that your returns will be far greater than the 5% you lost. It also gives you a partner that is a 900 pound gorilla with a billon dollars in guaranteed funding burning a hole in their pocket to assure that this endeavor succeeds.
Phillip
Here's a new theory . . . What if the share issuance was a result of a partnership with Drax that provided Drax with an equity stake in BMSPF. The concept had been touted in the past by BMSPF with respect to partial ownership by utilities in the pellet plants that they constructed (but not in the Company itself). With Drax as a partial owner in BMSPF, that would provide the backbone, credibility, and equity that the company needs.
Phillip
Drax (aka Baton Rouge Transit, LLC) is also looking for a three month extension on their option to lease. It's going to comittee and I presume the regular Board Meeting later this month. Sounds like BMSPF isn't the only one being delayed.
"9. Consideration and appropriate action on the proposed three month extension of the Option to Lease approximately nine (9) acres by Baton Rouge Transit, LLC. (Mr. Hardman)"
Phillip
I can understand issuing more shares to keep things afloat, but don't necessarily like it. Then again, the BMSPF Board of Directors are also working for free for the prospect of higher share price themselves. That gives me some comfort that they won't do anything crazy since they have a vested interest in seeing the price per share higher. With volume next to nothing right now, they couldn't sell all of the shares even if they wanted to. If I was to speculate (again), I would think this share issuance is timed to raise capital when news comes out resulting in improved market conditions that can better absorb these additional shares. It could also be a means to get people to work in exchange for a piece of the pie (ie their CFO). Since the hours they put in could be worth nothing if the share price falls, this also gives me the warm and fuzzies that they know something we don't when it comes to the future value of those insider holdings.
Phillip
There's probably a number of things holding it up. Issuing a bond doesn't happen over night and the bond issuance can fail. This is a lot of money and likely not something the Port has frequently done (if ever). They probably have consultants working on it and will need to go to their Board first. Design wise, my understanding is that they are increasing rail capacity into the Port which has caused some delays. Meanwhile in England Drax just received the news that the government will guarantee £75m of debt on their project (which I'm speculating will be BMSPF's primary contract). Drax may be hesitant to ink any deals until all their ducks are lined up so that they don't find themselves short on cash half way through construction.
Anyway, below is their current schedule as of 2/22/13 (from their MD&A):
Longest lead time required: Electrical Transformer 14 months
Earliest start date on site July 1, 2013
Earliest finish date - Commission Line 1 October 1, 2014
- Commission Line 2 December 1, 2014
- Commission Line 3 February 1, 2015
Phillip
The entire bond financing issue is all over the map when it comes to what it's going to cover. If you read their Sedar filings, they are talking about equity financing (ie issuing new shares) which dilutes our investments. This is what prevents me from investing any more than I already have. My only comfort is that they dilute the shares they hold also except they could issue shares to themselves as backpayment to make up for additional dilution.
From the company's MD&A filing:
"The Company proposes to meet any additional financing requirements through equity financing and short term loans from directors and officers."
From the company's interim financial statements:
Subsequent to December 31, 2012 the following significant event occurred:
"a) The Company issued 44,536,351 common shares to settle $545,409 due to related parties and $78,100 of trade accounts payable due to a partnership of which our CFO is a member."
Phillip
I've been here since 9/11/2002 when this stock spun off from FASC. I know what you mean. To answer your question though, the current schedule is listed in their SEDAR filings. It seems to be more realisitic than anything I've seen before.
Phillip
44,536,351 shares were issued after their 12/31/2012 interim financial statement. I get a new shares outstanding of 599,791,900. Sounds like a payment to the CFO. Hopefully shares issued to him since I didn't see that kind of volume dumped on the market. I hate to see my position diluted, but at the same time with the shares the officers hold being held on to, at least it shows they have the confidence of better times ahead.
Phillip
Good news always has a tepid reaction in the stock market when it only reaches the few people looking for it. Even the news itself isn't extremely surprising. They formed an LLC in Louisiana on 2/1/13 and extended their lease option for another 6 months after the old one expired. I've always maintained that we won't see the share price increase much until something substantial hits the news like Drax entering into a purchase agreement with BMSPF.
Anyway, here's my commentary that I glean from recent events:
1) With the fact that the Port renewed the lease option, one can conclude that they think the project is still viable.
2) The Drax PR announcement of a transloading facility at Baton Rouge doesn't add up. The handling capacity of their proposed site is huge compared to the production capacity of the pellet plants that they are building. Where does the rest of the material come from that they plan on shipping? My guess is their friendly next door neighbor with 90 acres at the Port.
3) Drax's PR announcement mentiones late stage negotiations with a third pellet company besides Enviva and GreenCircle. My guess is their friendly next door neighbor with 90 acres at the Port.
Phillip
Email Jim and let us know how long the extension is for and whether it was approved by the Board. I bug him too much and I'm starting to feel guilty so I'm afraid to ask. It went to the Port's comittee earlier and I presume it was approved since it made it to the full Board.
Phillip
BMSPF is back on the agenda for the Port of Baton Rouge for a time extension on the lease option.
http://www.portgbr.com/media/user/meetings/CommMtg%2002-28-13%20REVISED.pdf
Dunno. I'd be curious though what the Agenda for the committee meeting on 1/17/13 had to say. It isn't posted on their website.
Phillip
Nothing on today's agenda at the Port. Kanorado Corporation is interesting in the fact that they are Baton Rouge’s only full service barge terminal on the East side of the Mississippi River.
http://www.portgbr.com/media/user/meetings/CommMtg%2001-24-13.pdf
Phillip
Games. I wouldn't put very much merit into the share price when it goes up or down on 500 shares being traded. There's always the possibility someone has a buy order that's partially filled, but I don't see how someone is only selling 500 shares. It's only a $10 purchase.
Phillip
That's good to know. After years of waiting for even a small project, if this thing comes to fruition, it would have more potential than anything I would have ever imagined. So much different from the days when they spun off of FASC.
Phillip
With BMSPF's 90 acres and Drax's 10 acres both going to the Port's Board within 1 month of each other, it can be presumed that they aren't the same parcels of land. With the two companies operations being "compatable" with each other, I'm also speculating that they are working together.
If anything bothers me, it's the "non-compete" agreement that you mentioned. If BMSPF had to agree to not compete with Drax in certain markets, it might limit their market share if Drax decides to enter into new markets that they aren't currently in.
Phillip
That's one of the plants. The other is in Morehouse Parish in Lousiana (see link 1 below). Their transport facility is right next to BMSPF's proposed plant in Baton Rouge. My speculation is they will use the transport facility to receive pellets from all 3 sources. Drax is also flush with new cash to pay for it (see link 2 below).
1 - www.thetowntalk.com/article/20121214/BUSINESS/312140004/-120M-Louisiana-project-will-help-fuel-Drax-Group-s-clean-conversion
2 - www.yorkshirepost.co.uk/business/business-news/drax-can-bank-on-100m-boost-to-help-secure-thousands-of-jobs-1-5244896
It's like any bet. I could lose, I could win. I've been in long enough now that I'm sticking around to see it through.
Phillip
According to the Yorkshire Post, Drax annually requires 7-8 million metric tonnes of biomass. According the the press release, the plants Drax is building in the US will produce 0.9 million metric tonnes. If I was a betting man, I'd bet BMSPF has some form of agreement/partnership with Drax.
Phillip
Baton Rouge Transit, LLC is Drax according to the Louisiana Secretary of State.
Phillip
There's bits and pieces that add to the suspense if one was to read between the lines.
At the 10/18/12 Port Board Meeting, BMSPF is given a 90 day lease option for 90 acres (Agenda Item 10). At the same Board meeting, Baton Rouge Transit,LLC, has an Option to Lease Agreement with the Port (Agenda Item 13).
At their 11/15/12 Board Meeting Baton Rouge Transit,LLC, is announced to have a 10 year lease for a wood pellet transloading facility.
Your 12/17/12 Press Release from Drax announces a port storage and loading facility at the Port of Greater Baton Rouge. I don't see Drax in the Port's meeting minutes or building a pellet plant at Baton Rouge.
My speculation:
1) Baton Rouge Transit,LLC is Drax in the disguise of an LLC (anyone can create an LLC).
2) The fact that both are named in the 10/18/12 Board meeting minutes makes me think that both were intended to co-exist at the same site all along.
3) With BMSPF leasing 90 acres and Baton Rouge Transit,LLC leasing 10, they aren't competing for the same site.
4) With one building a pellet plant and the other building a transloading facility, my guess is they're partners.
5) With Drax building plants at two other pellet producing sites, my guess is BMSPF's site will have the the capability to sell directly to Drax as a third supplier.
6) Government Incentives mentioned in the Drax article sound very similar to those offered to BMSPF.
Anyway, it's getting interesting. I think I'll stick around for a while.
Phillip
Yea, it looks like Drax is building a facility at the Port of Batton Rouge also. 10 Acres. This doesn't look good, but maybe a partnership forming??
Phillip
Their PR said, "Biomass Secure Power expects to complete a long term lease agreement with the Greater Baton Rouge Port Commission by December 31, 2012."
Did they meet their timeline? Who knows. None of the previous deadlines were ever met, but my guess is if the option isn't exercised on time, the Port would allow an extension. I doubt they have anyone else lined up for the property. The question remains whether they were able to get financing. No panic selling or insider buying tells me there's still nothing concrete.
Interesting that the Port hasn't posted their Agenda for their upcoming Board meeting. I wonder if it's posted in the local library.
Phillip
Maybe it's the calm before the storm. When things get quiet, that's when my ears perk up since it's a potenital sign that things are happening and the company isn't just trying to pump the stock with press releases filled with fluff.
Phillip
Wow, what's going on today? Two purchases of 100k+ shares at $0.028. Does someone know something we don't?
Phillip
Welcome back.
Phillip
It sounds like the December meeting will be the next target. I wish someone could go to their Board meeting and report what is said since my guess is that it's going to be fairly quiet from the Port and BMSPF. I wonder if Louisiana has a public information request law?
Phillip
The Port had another Board meeting yesterday. The minutes from the October 18th meeting should be available shortly so it would be interesting to see if there was any additional insight into BMSPF's agreement with the Port.
Phillip
I use MyTrack, but the clearinghouse is Apex Clearing Corporation. I'm thinking about filing a complaint.
Phillip
Well, it sounds like I'm definitely in for the long haul. My broker said that their clearinghouse started a policy that I can't sell more than 10% of my position per day and there's a $50 fee for each day I sell. At $1500 in fees, it's not worth selling. I'm trapped until the share price takes off or BMSPF gets off the pink sheets.
Phillip
Their 3D rendering on their website makes it look like they will be on the parcel fronting the canal. I didn't think this property was owned by the Port though.
Phillip