"When KPI and GRNO finalize their agreement than [sic] I suspect the processor will be made operational again." Ron, don't you mean "if" instead of "when"? We're now three months past the original October deadline. I always double Bill's time estimates to balance his over-optimistic plans, but we're a month past that point, too.
However, the KPI agreement is NOT the real issue here. For months, the wholesale price of #2 diesel in the Charleston area, while low relative to some other parts of the nation, has EXCEEDED the prices charged in January-March 1997, when Bill presented us with glowing figures about how much money a 400 gph machine could make. It was a debated but reasonable position to take in the winter of 1998-99 not to run the processor because of low fuel prices and the absence of any cash reserve. Since March 1999, this machine should have been running full-time. Since October 1999, the money should have been pouring in, to the great benefit of both the partners and GRNO, since the latter owns over half the limited shares as well as its own general partner share. Instead, we see continued borrowing of money to keep the corporation from closing its doors and the wasting of the plant from lack of maintenance.
I talked to Bill last March about what would be required to re-start the plant, and he has known since May that I and some other partners could provide that amount. Since Bill has never provided a full or accurate accounting of the partnership's expenses, despite the requirement of law and the Partnership Agreement that he must do so annually, we had the condition that we must have some sort of transparent oversight on the use of these funds. I proposed to Bill a number of ways this oversight could be conducted. He flatly refused to consider any of them, and said in May and June that he wouldn't take the money even as a straight loan, because he "expected soon to have all the money he needed." We're still waiting, and Bill is still not accountable to anybody.
In effect, GRNO, through Bill, has refused to operate the processor for the benefit of the partners. At law and within the Agreement, doing so is the first duty of any General Partner.
What conclusion would any rational person draw from these circumstances, except that Bill knows that the processor will not work as promised? Filtration equipment has been deliberately torn out of the system and has not been replaced by anything, leading to the question of whether or not a working processor would even be able to make saleable fuel.
A number of lawyers have assured me that GRNO, through Bill, has committed so many violations of statutes and the provisions of the Agreement, that the limited partners would have no difficulty taking the GP away from the company without compensation. But what would we be getting for our legal expenses? A processor needing far more maintenance than Bill has admitted? A processor incapable of producing anything close to 400 gallons of #2 diesel fuel per hour? Or even a rusting pile of junk?
At this point, "waiting for KPI" begins to look a bit like waiting for your fairy godmother to descend and turn your pumpkin into a limousine. After three years, that pumpkin has the distinct odor of rot about it.
=+=+=Norm Hostetler |
