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Microcap & Penny Stocks : Rentech(RTK) - gas-to-liquids and cleaner fuel -- Ignore unavailable to you. Want to Upgrade?

To: melinda abplanalp who wrote (13630)	3/18/2000 12:30:00 PM
From: Howard Williams	Read Replies (1) \| Respond to of 14347

RNTK and SYNM stuff, FWIW...... Might as well use a little SI server space too.... :-) The following evolved out of some discussions on RB about RNTK and SYNM..... While I believe RNTK has bright scientists, I think SYNM does too. But the more important TECHNICAL discriminator between the companies was born 15-20 years ago. RNTK chose to follow an iron/slurry approach for frugality reasons. SYNM chose to follow cobalt/fixed-bed with an air-fed ATR for safety and simplicity reasons. Considerable efforts by both companies have matured their technologies, at least at the laboratory scale. RNTK stuck with iron/slurry and, via patented tailgas feedback, brought iron catalyst F-T efficiency up to cobalt's level, maybe even a shade better. Based on the 265 bpd Pueblo plant run by RNTK 8-10 years ago, there's virtually no doubt about RNTK's process in at least smaller-scale commercial GTL operations. Sand Creek will likely be the first place to show, in continuous use, the goodness of RNTK's approach, preceding any Texaco "bottoms" or "IGCC sidestream" applications IMHO. When TX finally makes their move, it'll be clear they believe in the efficacy of RNTK's F-T too. SYNM barked up another tree and now may be in a forest with few loggers. They may in fact be trapped by decisions made years ago and this could be very frustrating to what I believe are quality technical folks in the SYNM labs. In large-scale GTL operations, a difference of a few percent in plant efficiency makes a huge difference in plant profitability over a plant's life. Pushing all that nitrogen through their process is like running a 100 meter dash with a stone chained to your ankle. Then there's the reactor design. I am totally convinced, right or wrong, that selection of a fixed-bed approach for Sweetwater is a tacit admission by SYNM and their financiers that they have concerns about patent issues. If they were NOT concerned with those issues, why in heaven's name would they select the far costlier, fixed-bed approach, proved only at 2 bpd in Tulsa, over the superior 70 bpd "moving bed" approach now in operation for 6-8 months at Cherry Point? Moving bed (aka "slurry" IMHO) reactors are NOT risky technically. Everybody except SYNM espouses slurry reactors based on cost and efficiency. Fortunately for SYNM, a specialty chemicals plant like Sweetwater may make a go of it financially due to Australian government subsidies, cheap feedstock gas and high product values. But those three advantages don't exist simultaneously elsewhere. Subsidies are finite and the specialty chemicals market can get saturated quickly as more GTL plants pop up. It's just too easy to use part of a GTL plant's output for specialty chemicals as long as prices hold up. I'll make a guess that GTL specialty chemical sales price premiums will drop to 10-20% over GTL diesel within a few years. Business acumen. SYNM has unquestionably outdone RNTK in high-visibility actions....... --- early and heavy GTL technology promotion --- early signing of several licensees --- diverse and effective promotion of ultraclean diesel fuel --- orchestrating the Sweetwater/Australia arrangements Much of this has benefited all GTLers. But while SYNM likes to project a "world's leading" image, they trail Sasol and Shell in bringing GTL products to market and will soon trail RNTK also. I'm confident (but only time can verify) that RNTK will profit more, and sooner, than SYNM due to RNTK's technical savvy and dogged pursuit of niches where their F-T can be implemented effectively. I'll also admit RNTK has had a little luck on their side. Their decision to pursue iron/slurry (out of frugality) when cobalt looked more efficient was lucky. Now they're as efficient as cobalt AND can handle syngas from virtually any feedstock. The overbuilding of methanol plants to support ill-fated MTBE production was something RNTK could not have foreseen. More luck, for RNTK anyway. In retrospect, it's easy to say some of their acquisition activity was dubious. But it was initiated before the fog lifted, exposing the promise of GTL products to meet pressing environmental needs. Even the DOE didn't see it coming. Their "Vision 21" launched last year is aptly named. It didn't come out earlier entitled "Vision End of the 20th". Recognition of the need for GTL is just now building and many still don't understand or appreciate it fully. RNTK is in the right place at the right time with the right technology. Stay tuned....... Best wishes to all!