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Archer-Daniels-Midland Company Message Board

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  • manylumen manylumen Feb 7, 2009 12:04 AM Flag

    Blackbox Q and A

    could also be they want to use more ethanol for anit knock to replace mtbe etc.

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    • VLO is required to use an oxigenate that replaced MTBE, and ethanol is also used to increase to octane rating in gasoline.

      I think that to only reasaons that VLO would be interested in five of VSE's operations is that they are sitting on a billion dollars in cash; face a government mandate to include ethanol in thier gasoline and expect the blender's credit of $.51 to be eliminated. If you make and use it yourself, you eliminate the marked up on the ethanol. However, I do not think they would be doing it to produce ethanol for sale.

      Lastly, if they can buy five operating facilities for $280mm, that seems to be pretty cheap.

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