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Rentech, Inc. Message Board

  • Dooper55 Dooper55 Feb 21, 2007 10:11 AM Flag

    Proposed Aussie CTL would use RTK's FT

    30k bpd, potential expansion to 45k bpd. I'm guessing this is a Jacobs Consultancy (Jacobs Engineering) initiative under existing agreements with RTK to market RTK's FT technology.

    A 36 page pdf presentation about the project is available via Altona's homepage.

    News announcement is at .....

    http://www.resourceinvestor.com/pebble.asp?relid=29170

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    • P&D, LAST year (2006 AGM) shareholders approved the Incentive Award plan that included options allocated to several individuals SUBJECT TO THE APPROVAL OF THE 2006 PLAN BY SHAREHOLDERS. The plan was approved. THIS YEAR, no options or other awards have been issued to individuals subject to (in anticipation of) approval of the 3 million added shares for the plan.

      The plan remains "The 2006 Plan" and awards will be made under it up to the limit of shares in the plan, with or without shareholder approval of the added three million shares. I simply do not see what you're claiming to see.

    • Dooper, with all due respect,

      <<They are not, as you claim erroneously, issuing options subject to shareholder approval.>>

      The annual meeting notice states:

      "To vote upon a proposal to amend the 2006 Incentive Award Plan to increase the number of shares reserved for issuance under such plan by three million."

      The July 14, 2006 8k states:

      Under the 2006 Plan, the Company may grant stock options, restricted stock awards, stock appreciation right awards, performance share awards, performance stock unit awards, dividend equivalent awards, stock payment awards, deferred stock awards, restricted stock unit awards, performance bonus awards, or performance-based awards with respect to a maximum of 5 million shares of the Company�s common stock."

      So it does say the company may grant stock options for 2006 which is subject to shareholder option. The fact that they can grant all these other awards does not change the conclusion.

    • P&D, in the interests of accuracy, RTK is asking shareholders to approve an additional three million shares to be added to the 2006 Incentive Award Plan. As I recall, there's still about 1.3 million shares in the 2006 plan, unallocated. They are not, as you claim erroneously, issuing options subject to shareholder approval.

    • We certainly see the company on opposite sides of the coin.

      <<1. It is very early in CTL and when there are competitors, it is important to get yours out there as wide and visible as possible. I consider it logical to help make sure DRKW uses RTK versus someone else.>>

      Rtk's touts itself as the leader of FT in the US. If this were true, they wouldn't have to "buy" customers.

      <<By the way, one of the reasons I like RTK is because of their personnel.>>

      This is what I dislike the most about the company. For years these guys have had more VP's and directors on the payroll and have never gotten past a feasibility study for a project. And what's more, they make sure they pay themselves first. The ceo (that led a auto collision repair business into bankruptcy), was given millions in warrants as a consultant a couple of months before becoming president of rtk. The co-founders took fat retirement packages once a secondary was completed. And all the new executives are getting huge options that are not even tied to performance goals.

      By the way, the Nasdaq and NYSE do not allow companies to issue options subject to shareholder approval, which is what rtk is doing at the annual meeting (again).

      Watch out for the pdu, behind schedule and up to $40 million. The last quarter they pushed it out another quarter but didn't change the $40 million cost estimate. Watch for this next quarter.

      Good luck with it. I am waiting for a buy opportunity in the mid $2's.

    • OOkay, understand your logic.

      I would offer the fact that while RTK's technology might be the best approach (and I do say "might" cause I do not know for sure) to make the syngas into diesel/jet fuel, it certainly is not the only technology available to do so. In turn, the warrants may have made sense on two fronts:

      1. It is very early in CTL and when there are competitors, it is important to get yours out there as wide and visible as possible. I consider it logical to help make sure DRKW uses RTK versus someone else.

      2. RTK has a relationship with Peabody Coal, and by making sure DRKW uses RTK's technology, they have an in with Arch Coal. The value of this is self-explainatory.

      So, to be honest, in my mind getting DRKW on board was a very useful step and if we had to give up a few shares for it, rock on.

      Compnaies give away product early in the roll-out all the time. Do not need to di it if you are the only game in town, but the reality is RTK is not the only game in town. They cannot be so egotisitcal as to think they are.

      By the way, one of the reasons I like RTK is because of their personnel. While I know some do not care for them on this board, I like what I hear and see from them.

    • <<I will assume your statement is true. Why do you think that is such an ominous sign?>>

      First, a correction, the numbers are a warrant of 1 million shares of rtk at the signing of the license agreement and another warrant for 2 million shares when dkrw closes financing.

      This is ominous because, generally when a company has a new break-through technology, others pay them for the license, not the other way around. I believe that if the dkrw doesn't move forward, dkrw still got a warrant for 1 million shares from rtk.

      Second, rtk expensed the first warrant as a marketing expense which imho, means the deal was advertising for rtk. Who needed the license more, rtk or dkrw? (hint: follow the money).

    • cpm, working with round numbers, figure 1.6 - 1.7 bbls of FT products per ton of WY coal (though Arch's Medicine Bow coal is a little higher grade than PRB coal). So 13,000 bpd would take 7,000+ TPD of coal. If more electrical power is produced on the side, the plant would use more coal.

      It looks like the Las Vegas Sun writer dropped three zeroes off the tons of coal per day.

    • I will assume your statement is true. Why do you think that is such an ominous sign?

    • <<..Pumper, when you speak earlier of the coal industry having different economics in the CTL story, please remember that Arch bought 25% fo DKRW>>

      $25 million for $5 billion company is hardly a huge investment.

      Do you know that when rtk signed the licensing agreement with dkrw, they gave them 5 million rtk warrants and later wrote off the cost of the first ones issued as a marketing expense. Not a good sign.

    • Pumper, when you speak earlier of the coal industry having different economics in the CTL story, please remember that Arch bought 25% fo DKRW. So, clearly they are putting their money in already. So, I am not so sure you can separate the coal companies and their experience from the CTL when someone says interest from major compnaies helps validate Rentech potential.

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