Gevo, Inc. Q3 FY2020 Earnings Call

Welcome to Gevo Third Quarter 2020 Earnings Conference Call. My name is Catherine, and I will be your operator for today’s call. At this time, all participants are in a listen-only mode. Later we will be conducting a question-and-answer session. Please note that this conference is being recorded. I’ll now turn the call over to Geoffrey Williams, Gevo’s Vice President, General Counsel and Secretary. Please go ahead, Mr. Williams.

Good afternoon, everyone. And thank you for joining Gevo’s third quarter 2020 earnings conference call. I would like to start by introducing today’s participants from the company. With us today is Patrick Gruber, Gevo’s Chief Executive Officer; Lynn Smull, Gevo’s Chief Financial Officer; and Carolyn Romero, our Vice President and Controller. Earlier today, we issued a press release that outlines the topics we plan to discuss today. A copy of this press release is available on our website at www.gevo.com. I would like to remind our listeners that this conference call is open to the media and that we are providing a simultaneous webcast of this call to the public. A replay of today’s call will be available on Gevo’s website. On the call today and on this webcast, you will hear discussions of certain non-GAAP financial measures. Non-GAAP financial measures should not be considered in isolation from or as a substitute for financial information presented in accordance with GAAP. Reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures is contained in the press release distributed today, which is posted on our website. We will also make certain forward-looking statements about events and circumstances that have not yet occurred, including, but not limited to, projections about Gevo’s business development plans and operating activities for the remainder of 2020 and beyond. These forward-looking statements are based on management’s current beliefs, expectations and assumptions, and are subject to certain significant risks and uncertainties, including those disclosed in Gevo’s Form 10-K for the year ended December 31, 2019, that was filed with the U.S. Securities and Exchange Commission, and in subsequent reports and other filings made with the SEC by Gevo, including Gevo’s quarterly reports on Form 10-Q. Investors are cautioned not to place undue reliance on any such forward-looking statements. Such forward-looking statements speak only as of today’s date and Gevo disclaims any obligation to update information contained in these forward-looking statements whether as a result of new information, future events or otherwise. On today’s call, Pat will begin with a discussion of Gevo’s business developments, Lynn will discuss the status of the Citigroup financing process and Carolyn will then review Gevo’s financial results for the third quarter of 2020. Following the presentation, we will open up the call for questions. I’ll now turn the call over to Pat.

Thanks, Geoff. This past quarter was extremely significant for us. We now have about 48 million gallons per year of take-or-pay off-take agreements in place, representing approximately $1.5 billion across the life of those contracts, which run about six to seven years from the start of full-scale production. These take-or-pay contracts are being used to secure the funding to build plants. Not that long ago, we were working hard just to sell out the capacity of our Luverne Facility. Our business has now changed. We now have demand for our products with contracts that justify more than one production facility. The Luverne is not big enough to service the contracts we already have signed. The increased demand is significant because it shows potential investors that our plant projects offer significant growth potential beyond just Luverne. That’s important because people want to see platforms of projects. Not only that, potential investors in the project see clearly that we have the funds to fully pay off Whitebox. Before you raise money, this past quarter, there has been a real question of how we deal with Whitebox. Whitebox, from a potential investor point of view, complicated future deals because Whitebox, by the way, has been an outstanding partner over the last seven years and has a senior secured position in all Gevo assets, with physical and intellectual property. Well, now we have the money in the bank to pay off Whitebox and remove the liens. We have been able to pay them off, which is clearly a big deal. Nothing can prevent that from happening by year-end. We also now have the money to do the required project engineering and development work necessary to secure project financing. In fact, we’ve already started to move forward on this. We are in the midst of choosing additional plant sites. Our choice of plant sites is impacted by the ideas of our potential equity investors. Yeah, you heard me right. While we haven’t announced who our potential equity investors are, we are working with several potential partners. Lynn will talk more about the Citigroup financing project in a couple of minutes. On the business development front, we expect to secure additional large offtake agreements. Negotiations are progressing, albeit not fast enough for my liking; I would prefer to announce them already, but they aren’t inked yet. We have more players in the mix wanting more volume. That’s great. But we need the details to get down to the contract sign so that we can then pin down additional plant sites as well as the total number of plants. In the meantime, we are getting on with the engineering for the 48 million gallons per year of plant projects that are already under the contracts. I expect that in the near future, we will announce the names of the engineering firms that we’ll be using to engineer and build the projects. So for the first time in many years — and this is a big deal — we are in the mode of having to raise money simply to stay alive. Now it’s all about project execution and growth. It’s about leveraging our technology, the marketplace development that we already have in place, and getting the project financing secured to build multiple projects. With that, I will turn the call over to Lynn to provide more details on the project finance process with Citigroup. Lynn?

Thank you, Pat. The Citigroup process to assist Gevo in securing financing to build out our production capacity is going well. Recall that we’re trying to raise about $700 million at the project level, which would finance three plant construction projects to supply about 70 million gallons per year. We anticipate that this financing would require about $200 million in equity and $500 million in debt. Citigroup is helping us with both the debt and the equity. The $700 million in funding would be invested in special purpose project entities that are non-recourse to Gevo. We anticipate that Gevo will be a minority equity holder in the SPVs. By raising money at the project level, we avoid a couple of issues. First, it’s not diluted to Gevo, Inc.’s stock, and second, it allows us access to capital from companies and funds who may have limitations on investing in Gevo stock and may have preferences for specific project exposures. On the equity side, we have several term sheets that are more than enough to cover the equity needed. Each of these potential investors is deep into diligence. This isn’t like investing in penny stocks where people buy them knowing nothing. In project finance, investors go through every detail. They hire experts who have to vet the information from technology to commercial structure to pro forma financial results. Project investors, both debt and equity, require a complete understanding of the risk-return proposition. After they complete their diligence, we would move to finalizing equity investment terms. The timeline for diligence typically takes months even if we weren’t in a COVID world. Despite COVID, we’ve become pretty adept at dealing with it by increasing our use of video conferencing. Once the diligence phase is complete and we’ve agreed on financial terms, we would enter into binding agreements for the investments and advance the work to meet typical project-style conditions precedent to financial close. On the debt front, Citigroup has been figuring out the best options, and we believe we have a clear path to a debt format and structure that should appeal to investors. The debt to build out the plants doesn’t get into place unless the equity commitment is assured and vice versa. These closings are essentially simultaneous. We are also paying attention to timing. We have approximately 48 million gallons per year under contract. The Citi projects contemplate 70 million gallons per year. We don’t have to do all 70 million gallons at once, which is why Pat said we are moving forward on the first two plant sites now. As we pin down the next set of customer contracts and their volumes, we will also pin down a third site and begin development work in engineering for that site as well. We have strong players who have strong strategic and financial reasons for wanting to invest in Gevo’s projects. Stay tuned. Now I’ll turn the call over to Carolyn, who will take us through the financials. Carolyn?

Thank you, Lynn. Gevo reported revenue in the third quarter of 2020 of $0.2 million, as compared to $6.1 million in the same period in 2019. During the third quarter of 2020, hydrocarbon revenue was $0.1 million, compared to $0.6 million in the same period in 2019. Hydrocarbon sales decreased because of lower shipments of finished products from our demonstration plant at the South Hampton Resources facility in Silsbee, Texas. During the third quarter of 2020, revenue derived at the Luverne Facility from ethanol sales and related products was $0.02 million, compared with $5.6 million during the same period in 2019. As a result of COVID-19 and an unfavorable commodity environment, we terminated our production of ethanol and distillers grain in March 2020, which resulted in lower sales for the third quarter. Cost of goods sold was $2.3 million in the third quarter of 2020 versus $9.9 million in the same period in 2019. Cost of goods sold included approximately $0.9 million associated with the production of IBA and related products, and the maintenance of the Luverne Facility, and approximately $1.4 million in depreciation expense. The gross loss was $2.1 million for the third quarter of 2020 versus $3.8 million for the third quarter of 2019. Research and development expense decreased by $0.9 million during the third quarter of 2020 compared with the same period in 2019, due primarily to a decrease in personnel and consulting expenses. Selling, general and administrative expense increased by $0.8 million during the third quarter of 2020 compared with the same period in 2019, due primarily to an increase in personnel, consulting and insurance expenses, and then professional fees offset by a decrease in Investor Relations expense. For the third quarter of 2020, we reported a loss from operations of $6.1 million, compared to $8.0 million for the same period in 2019. In the third quarter of 2020, cash EBITDA loss, a non-GAAP measure that is calculated by adding back depreciation and non-cash stock-based compensation to GAAP loss from operations, was $4.0 million, compared to $5.8 million in the same quarter of 2019. Interest expense for the third quarter of 2020 was $0.5 million, a slight decrease compared to the same period in 2019 as a result of lower amortization of original issue discount and debt issuance costs and the conversion of $2.0 million of the 2020/21 notes to common stock during July of 2020. For the third quarter 2020, we reported a net loss of $6.8 million or a loss of $0.09 per share based on a weighted average of 77,049,896 shares outstanding. This compares to a loss of $8.6 million in the third quarter of 2019 or a loss of $0.66 per share based on a weighted average of 12,968,265 shares outstanding. In the third quarter of 2020, we recognized a net non-cash gain totaling $0.2 million due to changes in the fair value of certain of our financial instruments, such as warrants and embedded derivatives. Also during the third quarter of 2020, we incurred a $0.5 million loss related to the conversion of $2.0 million of the 2020/21 notes into common stock during July 2020. Adding back these non-cash losses resulted in a non-GAAP adjusted net loss of $6.5 million in the third quarter of 2020 or non-GAAP adjusted net loss per share of $0.08, based on a weighted average of 77,049,896 shares outstanding. This compares to a non-GAAP adjusted net loss of $8.6 million in the third quarter of 2019 or a non-GAAP adjusted net loss per share of $0.66 based on a weighted average of 12,968,265 shares outstanding. Now, I’ll turn it back over to Pat to wrap things up.

Thanks, Carolyn. I’ve got a couple of other points to touch upon. Price continues to make progress; recall they are working to license and build plants in India with the idea that the Indian Airforce would be the ultimate customer. I have a suspicion that other airlines might become customers too. That’ll continue to make progress over the coming months and over the next year. We are also continuing the development of our biogas projects. These projects are financially attractive, offering significant cash flow returns. We have the development engineering money needed to secure project financing, so we’re moving forward with that, rather than being stuck having to raise development expense capital. And we also have the equity needed to move forward; we just have to work on and continue to get the debt terms arranged. That’s a nice project. It generates nice cash flows. Now looking forward, I expect I will soon announce the engineering firms and additional plant sites. These things are more about timing than we can influence; I expect that we will soon have additional customer contracts to announce, and that they should be substantial, and they’re being worked on. We are always faster than the big companies we’re negotiating with, and timing is in their hands. As I said before, contracts are progressing just fast enough for me. Finally, I expect that as we finalize the equity investors in our plant production projects and get those deals done to the point where they are allowed to be visible, we’re going to be very glad to tell you about that too. We’ve heard from some of you that you may have noticed more activity up at our Luverne site. Well, you’re right. There’s more going on there. We’re in the midst of running a campaign to produce more isobutanol to replenish our inventory. We use the isobutanol that we produce there as a feedstock for the hydrocarbon plant down in Texas; Haltermann and others want the products. We still see no reason to run ethanol; we would just lose money. So, with that, let’s open up the call for questions. Operator?

Thank you. Our first question comes from Shawn Severson with Water Tower Research. Your line is open. Please go ahead.

Thanks. Good afternoon, everyone. Hey, Pat, can you give a little more color on who you’re talking to and specifically address these strategic versus financial investors? And maybe compare and contrast which would be preferred by you and why?

Well, what’s interesting about what we’re doing, if you stop and really look at it, is we’re capturing renewable energy that we’re putting into the form of a liquid fuel. Our liquid fuels can be used in the gasoline sector for automobiles, the dump trucks, and of course, for airplanes. We’re using wind energy, biogas energy, photosynthetic energy, which touches on agriculture, and hydrogen too; because if you have excess wind, you can do something with it, we will be involved with hydrogen as well. So you start to look at that, who might be interested? It makes for a different slate of people than one might expect because the whole greenhouse gas issue that needs to be solved is how do we get off of coal, fossil-based natural gas, and fossil-based electricity. A business system like ours allows and enables the capture of all the different things and packs that energy into a fungible fuel in the form of a liquid hydrocarbon, which of course can be taken to any market. That’s interesting. So it’s a different kind of groups of people who are interested in these things. And then as far as the individuals, whether the companies, whether they’re funds or strategics, I think that carbon is more valuable — reductions of carbon are more valuable to strategics because they have to do something about it. So that’s what we’re seeing in the midst of all this investment, like in renewable diesel, and you have all these big energy companies who, not that long ago, you would have said no way they would ever invest in such things; and now that’s what they’re starting to do. Yeah, that kind of thing; they have to do something, and there’s no escaping.

I just have a follow-up on looking at liquid fuels and kind of comparing that as a renewable solution. I mean, relative to wind and bio and fuel cell electric vehicles, renewable natural gas, a lot of different technologies, and obviously sometimes I think liquid fuels get left by the wayside a bit. But can you sort of compare and contrast how that fits into the renewable future?

Sure. When you look at projections of energy for the future and actually what vehicles are even being sold, and you look out, like, 2050, it’s pretty much the same kind of energy profile that we have today, although there is a bigger component of renewable attached. So think of it this way: the growth gets taken up by renewable energy, and of course, we have growth because economies are planning on developing still. But we still wind up with the same kind of size of the fossil fuel need unless something changes. Now, when you think about trying to use electricity, you’ve got to have a new vehicle, you’ve got to have batteries, you’ve got to be able to have a good supply of the batteries, they have to work long enough, and you actually have to have renewable electricity to deliver to those batteries, and it has to be done in a concentrated way so that you can get the bang for the buck in terms of vehicles. You think of it this way with ours: We’re taking that renewable energy, packing it into a liquid fuel, and then it uses all the existing infrastructure. There’s no change required on the part of the consumer. No change required on the part of a fleet owner. It’s just a different game to play. And so it’s not one or the other; we’re going to need them all because the amount of fuel that has to be replaced from fossil-based stuff is so enormous that it’s going to take any and all solutions. So I think it’s a question of, in some places, it’s going to make terrific sense to have EV, other places not so much, like in a rural place or it might be that you think about, I mentioned the fuel cells earlier. We have wind towers, and we’re making excess wind because the wind’s blowing and I don’t need it for the plant. You know what? I think maybe we ought to make hydrogen out of it, and maybe we turn it into something that plays in that market sector too. So when I look at the future, I see that it’s going to take multiple solutions. We have an interesting one because we’re not hung up with infrastructure; we can leverage existing infrastructure. We’re not hung up with having to get new fleets and talking everyone into buying a new vehicle. You know what? It gives you the same old vehicle, lower your carbon footprint by using our products directly. People haven’t thought of it much because they’ve been unaware of these types of things; they just don’t know yet. They still look at us and go, 'What? You are doing gasoline? You mean ethanol?' No, we’re not doing ethanol. Ethanol is like the 10%. We’re doing the other 90%. What? You can do that? We run into this all the time; people just don’t know. It's interesting. But of course, this is why Trafigura signed up with us, because they get it, Haltermann Carless gets it, and there will be others too, who get it as well.

Thanks, Pat. My last question step out is on cash flow? Is this quarter pretty good proxy going forward for cash burn? Or is there going to be any other changes or investments you think you’ve made over the next couple quarters?

I think it’s pretty typical. They’re going to creep up incrementally a little bit, as we had to reduce staff. And so we have to bring back a few more people, so it should be pretty typical. We’re going to have chunks that get spent at various times for engineering projects, so these aren’t like your typical R&D burn type things. You’re going to be now doing engineering work, paying a company to deliver on a project, and we expect to be reimbursed as the project closes. So we have some of those types of expenses, and we’ll be able to give more color on those. So in terms of your basic burn, we’re in pretty good shape. What’s interesting about this is the question I get most often is, 'Hey, when are you going to raise money again?' We don’t have plans to raise money anytime soon. Although I do recognize that as we get these projects deployed and we have a good partnership with equity investors, it might be useful for us to invest, and that might be a consideration down the road.

Thank you. And our next question comes from the line of Amit Dayal with H.C. Wainwright. Your line is open. Please go ahead.

Thank you. Good afternoon, everyone. I appreciate you taking questions. Great to see the level of sales coming together on these plants forward. So did I hear correctly that you have equity investors for 48 million gallons already in place? You’re trying to see if you can get additional investors to come to that 20 million gallon number; and if that doesn’t come in within a certain timeframe, you are happy to move forward with this 48 million gallon financing that is shaping up for you?

Actually, it’s slightly different than that. We actually have equity investors willing to put up the equity for all 70 million gallons. However, we will probably tranche it because we have the contract, the take or pay contracts in place for 48 million gallons. That’s clear; we can move on with it. And then depending upon who takes that next tranche — there are a couple of them who could do it — then that would dictate where we might want to locate a plant, and it will influence a little bit of the decision. But we already have the equity players; we have term sheets from them to do the whole build-out of the first three plants.

Okay. Understood. So that’s a really big development. And alongside that, are you finalizing the engineering firms, or have you already sort of finalized it and are you waiting for certain catalysts before you announce who the engineering team will be?

Well, it’s — yeah, we have our lead horse, and we’re already engaging him. We have to go through — there’s initial steps again you are going to have to do, and then when to do the lot, the whole turnkey project, there are a couple of other people whose names have surfaced lately that we have to look at. So it’s about — we will announce it at the appropriate time. We’re definitely engaged.

Okay. So do you — is any of this sort of news flow potentially going to come before the end of 2020, or should we expect announcements around these to happen in early 2021?

I don’t know yet. It’s like, I don't want to put — I don’t — I’ll put — I’ll do stuff when it’s signed. The engineering stuff, I think, is more in our control; the site selections are more in our control, so those could happen sooner rather than later. But we’ll announce it when it’s ready to announce. They could be sooner. So I would expect those to be sooner. Regarding the customers, okay, this is one of these ones where I see it growing; I see the list of people who want the product is growing. I see that the contracts are being negotiated. There are a couple of contracts that I didn’t think would be done by now, but they got caught up with stuff with the other company that had nothing to do with us or our product. It was just their whole situation, and it will get done eventually. So those could take a little bit longer. But now the stuff is still moving forward. I don’t know; it’s just — it’ll — this is somewhat unpredictable anyway. So I even hate making predictions. But in terms of the engineering firms and site selection, I’d expect those things to happen sooner rather than later, but I’ll announce it when it’s ready to announce.

Okay. Based on how all this sort of falls in place and if it happens to fall in place, say, by the first half of 2021, do you potentially start getting paid for development work that you will be putting into this?

Yeah. The way that this should unfold is that we do the development work up front, then we get reimbursed for it. If the things hold to schedule, we should start to see some of that money coming back to us late in 2021. So — and late meaning the latter half; don’t know exactly when, depends upon how things get done and their timing. We have a couple of these partners who want to go faster rather than slower, which of course suits us too. So what should happen is, we’ll announce the engineering firms and sites, we will announce additional customers, we will announce then who is our equity partners in the project, we will announce who it is that how we’re doing on the debt side simultaneously, as Lynn mentioned, and then they’ll be moving it forward to the financial close. After that, we will get reimbursed for the money we just spent on the engineering and the other stuff and licensing fees and things like that. Yeah, that should matter a lot. It’s material. The good news is we have enough money on our balance sheet that if it takes longer, we’re still in good shape. So I don’t have any reason to think it would take longer other than the practical reality that stuff sometimes does. But you know what? They are working through. The next milestone for the equity, on the project front — plant project front — is to get those equity investors locked down. Now, I also mentioned the biogas in my comments. The biogas thing is interesting because biogas is something we needed; we wanted it for feeding our boilers and our plant because reducing it gets us off natural gas partially, and that reduces our carbon scores. Of course, we get paid for carbon score. It matters. However, guess what? We also can sell that to California, and that we’ll be doing that. It should be expected. That should start up in the latter half if things go right; we still have work to do on the financing front, but we should — that should be generating revenue maybe late next year or two. It should be. So we’re going to have — I would expect a couple of revenue streams we hadn’t seen before, and of course, if ethanol ever does come back to be something where it’s profitable, we can always turn that back on.

Okay. Understood. And then with this timeline that you now have, there’s a lot more clarity versus maybe even last quarter and all this. Are you comfortable that you will be able to meet your agreement with Trafigura for the 25 million gallons per year by the 2023 timeline?

Yes.

Okay. Understood. And then with respect to the 50,000 production that is ongoing right now from South Hampton, which customers is this product going through? Is it all going to one or two customers or are these multiple clients that you are obtaining?

Yes. So what we’re doing is, remember the capacity for our plant down in Silsbee, Texas, is about 100,000 gallons per year, right? And we have the ability to move the output from jet fuel to gasoline. These renewable gasoline, Haltermann Carless would — they always want; it always seems to me that they want more hydrocarbon, more isooctane, and there are other people like them. The isooctane is particularly interesting. Jet fuel, sure, people want to use it and test it, but we don’t have enough capacity to move the needle anywhere, except for some corporate aviation stuff that someday I hope to be able to announce because people will find it interesting as to who’s been buying it; we just aren’t allowed to say who it is. The — what we’re running now up at Luverne — we did start the Luverne plant up. It’s not running ethanol; it’s running isobutanol, and we’re running a campaign to make isobutanol gallons so that we can feed them down into our plant in Texas.

Okay. Understood. Yeah. Those are all my questions, Pat. Thank you.

Yeah. It’s kind of fun to be running our isobutanol again because how often do I get asked, 'Well, I can’t run it?' Yeah, we do. This is — we’ve been doing this — we need renewable isobutanol. So we got to go make it ourselves, and we have a team in place to do that.

Thank you. And our next question comes from the line of Poe Fratt with NOBLE Capital Markets. Your line is open. Please go ahead.

Thank you. Good afternoon, Pat.

Hi, Poe.

Good afternoon, Lynn, and the rest of the team. Busy quarter last quarter; it looks like this quarter is going to be — the big event is going to be the payoff of the Whitebox debt at the end of the quarter. When you talk about the biogas investing promises, you’ve talked before about a certain amount, and can you remind me of the amount of that potential equity investment and what the timing might be?

It will depend upon having the debt side. I think the best answer to this is, it’s not an outrageous investment. I don’t know the amount that we will have to put in because there’s been some equity players who have indicated some interest in co-investing with us. We have to decide if it makes sense or not. I hope it does. Although I do like returns from this project. So it’s — and then there’s the debt side. So I think this is one where, because I have moving parts, I don’t want to speak out of turn. It’s not huge capital, though, in any case. So it’s like $15 million would be the full equity amount if we had to pay it.

And it will go...?

Yeah. I just want to guess, but I just don’t know. This is, again, strictly returns. A project like this has financial returns that are ridiculously high IRR. And so there’s that real question; we’re going to have to look at ourselves and say, hmm, maybe we want that money for ourselves because I might want the cash flow. So that’s the kind of stuff that we have to evaluate yet. I just don’t know.

And then can you talk about just the term sheets that are outstanding with both the financial and the strategic equity players? I think on previous calls, you talked about how many LOIs on two plant locations? Is the strategic brain potentially another plant location, replacing one of those LOIs? Can you just sort of talk about the LOIs that we previously had on plant locations and then also when you expect to move on those LOIs and close?

Oh! Okay. So two separate things. So we got the term sheets from equity investors; they definitely have ideas about where they want the product, how they want to do it, how fast they want to go, can we accelerate it, stuff like that. Okay? That influences how we think about things, and it’ll be interesting for people once we can actually talk about it clearly and openly; it’s going to be interesting now as we add in more gallons. We continue our search and continue to look at other sites for taking over an ethanol plant or building a side-by-side isobutanol hydrocarbon plant. We have several players who are interested in that; they’re open to it, and we have LOIs; we have them already. We could do that. It’s a question of which one makes the most economic sense in light of who it is that we’re working with on the equity side of the project. So we have multiple sites already that we could use, and we think there’s a better one.

Okay. And then when we look at the non-recourse has to be constructed, and then you’ll retain a minority interest, can you talk, I guess, Lynn alluded to that the debt structure has been finalized? Can you share with us final terms on the debt side? And then also what potentially minority interest level you might see you will retain at the SPV level?

What’s interesting is I’ll answer the last part first — I don’t want to — I’m not sure of the minority; what our minority interest will be exactly because it depends on how much we invest. We have enough cash in our balance sheet to make a good investment in those projects, and that would lift our portion of that project, and the returns on these projects are attractive. So that would be good for us in a cash flow sense. We already have money that we could invest, and it wouldn’t upraise any more. So there’s a question; do we do that or not? So that impacts then how big our minority interest is? Of course, just by being a developer in licensing technology and all the rest, we would expect to get some minority interest typical of what would be market in a developer, although we’re also licensers. For us, as we make money as Gevo, remember, we get money from licensing fees or operating fees because who’s going to operate these plants? It’s going to be Gevo; we get paid to operate these things. So that’s all part of this overall equation. And then the debt structure itself, it is — we have a very clear view of how to do it, what to do, who’s going to do it. Could it be subject to change still? Yeah, like, so I don’t want to give a specific percentage interest rate with these specific terms because this all depends on who plays, how they play, do we do it? Do we tranche it? What do we do? There are a bunch of things that still could move around. I just don’t want someone to send me 50 billion emails on, 'Well, you said this,' I am just not ready for it yet.

Okay. Got it. And then if you could talk about the engineering plans? It sounds like that it’s two phases; you have the feed. The feed player in place already, design work's underway, and then once that’s all finalized, you’ll go out and get it to a whole EPC contractor. When is the EPC contractor — is that potentially done as financial close?

So soon.

Much sooner?

Much sooner.

I think we’d be forward if we have talked about financial close in the first half of 2021 towards the later — probably later rather than sooner, closer to mid...

Well, it’s the same. Yeah, actually, it’s the same if you go back and look; we talked about it being the second half of the year, takes one year, even doing this type of project to get something to close. But we talked about doing the financial close on biogas. I would expect in the first half of the year.

Okay. And then, any comment on what potentially happened under good, bad, or different under the Biden administration?

That’s interesting to see. Yeah, so that should be interesting. It should bode well for us. I would think so because this is a chance for some of the greenhouse gas stuff to get put into policy. Hopefully, it’ll be done in a good constructive way. There’s a — they got a win over the Midwest, the dams do. That’s good for agriculture. There’s a whole bunch of new techniques called regenerative agriculture. But it’s a — how do you capture carbon in soil that does come into play. People are waking up to the fact that food — growing stuff isn’t necessarily easier. That’s how you do it. But we’ve known that for years and we have been talking about it; good people are listening. And so I think overall, it’s good for us. There’s no question about it. It’s just — we got to see what happens in Georgia; does the whole thing turn blue or is it going to be more incremental if the Senate stays red? So overall, it’s got to be good for us, right? Because we happen to have one of the few technologies, maybe the only one that I’m aware of, that can be scaled up to deal with gasoline itself, the hydrocarbon portion of gasoline. And of course, we have the ability to make the jet fuel or diesel fuel too. Plus, if the people are as aggressive as they say they’re going to be about chemicals and materials, good; I have the building block for those too. So let’s go. Let’s get on with it.

Okay. Great. Thank you so much, Pat.

You bet. Yeah.

Thank you. And I’m showing no further questions at this time, and I would like to turn the conference back over to Patrick Gruber for any further remarks.

Great. Thank you all for joining us. It’s an exciting time for us. It’s quite a different position that this company is in now. It was not that long ago, when we were — having to bear — how are we going to live through the year? I’m looking forward to paying off Whitebox and getting out from under that debt. I’ve heard from many of you that that’s an important thing, and it’s crystal clear that that’s going to happen. We’re moving forward on these engineering projects, and moving forward on biogas. It’s good. We’re going to — it’s interesting, and momentum seems to be going in our favor across the Board, including with the election. So we’re pretty darn excited about what’s going on, and our partners seem to be too. I just got again over the line on everything. So, thanks for your support. Thanks for joining us. Have a great evening. Bye.

Ladies and gentlemen, thank you for participating in today’s conference. This does conclude the program, and you may all disconnect. Everyone have a great day.