Rentech(RTK) - gas-to-liquids and cleaner fuel Message Board

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Microcap & Penny Stocks : Rentech(RTK) - gas-to-liquids and cleaner fuel

RTK 0.200

+5.3%

Oct 13 5:00 PM EST

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To: Worswick who wrote (12100)	12/13/1998 10:23:00 AM
From: Zeev Hed	Read Replies (1) of 14347

Worswick: The real "BIG" market for GTL is in relatively small modular systems that can be placed at well heads with capacities as low as maybe 1000 barrels equivalent per day. Furthermore the capital cost per barrel per day production must be low as well ($5/barrel?). I think that both RNTK and SYNM have systems that are too big for that application, so they are targeting markets such "bottoms" or coal liquifaction (via coal gasification then liquifaction) but not the huge market of wasted natural gas which is flared or reinjected. As far as cost with their current technologies, I believe that RNTK has some advantage, using a much lower cost catalyst, and having Texaco as a partner. On the other hand, SYNM has a greater existing installation base and better financing (but I have not checked this one recently). RNTK has, of course a small problem with floorless instruments, and the fact that their big brother is busy fighting the oil blues. Due to the low price of crude, capital budgets are slashed and I think that the industry is putting in place new thresholds for new projects at sub $10/barrel. I have no idea if the RNTK project pass or not these new investments hurdles. The anemic reaction to the Texaco deal announcement probably indicates that they have not passed the hurdle, and thus the partnership's development may face some delays. The main question would be cash availability to live during the through in crude prices and the length of the deflationary period. RNTK has a leaky floorless in place, thus cash availability may not be an immediate problem, but the cost to current stockholders of RNTK will be major dilution. That, as you know, will depend on how fast Asia can recover and once more serves as the growth engine for crude demand in the world. You are much more qualified then I am to answer this question. Good luck. Zeev

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