Scout, here is how I approached my Culbertson earnings model:
1. Maximum crush capacity = 5,000 MT per month (assumed as it is not known right now)
2. Price per MT of Crude Degummed Oil = $963 / MT (used weighted average of calendar year prices for 2008 - 2010. Although current prices are $1,200 / MT, I believe there is too much fluctuation in the historic prices to use this going forward or trending it out)
3. Price per MT of Meal = $239 / MT (used same weighted average for same reason)
4. I did not adjust the price per MT from Canadian $'s (Canola Council data is in Canadian $') to US $'s becuase the conversion rates have historically been so close.
5. Assumed 1,079 liters of Crude Degummed Oil per MT (can someone check this?) I based this on the 10/31/10 10Q which states 19.7 million liters is approximatley 18,250 MT.
6. Resulting weight of meal would be 10% of gross canola weight input
Scenario 1 - Gross of $1,093,000 / month or $13,116,000 per year(Assumes 3,000 MT of Camelina and 2,000 MT of Canola per month.)
Camelina = $180,000 (3,000 MT x $60 / MT)
Canola = $865,000 (((2,000 MT of seed x 2,204.63 lbs. / MT) / 50 lbs per bushel) x 11 liters of oil per bushel) = 970,000 liters of oil / 1,079 liters per MT = 900 MT of oil x $963 / MT = $865,000
Meal = $48,000 (2,000 MT of seed x 10% = 200 MT of meal x $239 / MT) (I did not calculate anything for the resulting Camelina meal, as I am not clear from the lease what happens to it. I am assuming Great Plains keeps oil and meal.)
Scenario 2 - Gross of $913,000 / month or $10,956,000 per year(Assumes 0 MT of Camelina and 2,000 MT of Canola per month.)
Scenario 3 - Gross of $2,280,000 / month or $27,360,000 / year(Assumes 0 MT of Camelina and 5,000 MT of Canola per month.)
Scenario 4 - Gross of $516,000/ month or $6,192,000/ year (Assumes 1,000 MT of Camelina and 1,000 MT of Canola per month.)
I think gross of $30M on Culbertson is best case scenario all of the stars lining up. I am leaning toward somewhere between scenario 2 and 4, but that also assumes we are up and running from day one. I would possibly need to adjust for ramp up and seasonality. ALL IN MY OPINION.
AI
