Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Arcon Energy (MIDL Presently) The Ultimate Sleeper -- Ignore unavailable to you. Want to Upgrade?

To: Ga Bard who wrote (2436)	6/3/1998 2:41:00 PM
From: James A. Cole Jr.	Read Replies (1) \| Respond to of 4142

Dear Gary, Following is from another Board and relates to volume projections basis for which may be questionable; only because of what I write below-. Does anyone know anything about the volumetrics of D-144. Is it a small quantity, say a pint, blended into 0.95 gallons of ethanol, with the resultant D-144/ethanol gallon then blended into 9 gallons of gasoline. When one reads of their plant construction and throughput figures, the question arises as to what the stated capacity figures relate to. That of course impacts heavily on economic projections/estimates for a plant of given capacity, ie. is it apples or oranges? In other words, would they deliver straight D-144 to refiners/blenders OR the D-144/ethanol blend. That could impact on the California situation as any ethanol supply would probably not come via pipeline but either by rail car or truck I'll be interested in hearing any thoughts. Regards, Jim Cole jacolejr114@aol.com 203-972-0063 ********************************************************************************* Subject: MIDL-OTC- Midland Inc.Drip of $$$$$$$$$$$$$ Date: Tue, Jun 2, 1998 23:13 EDT From: Trader2639 Message-id: MIDL-OTC- Midland Inc.=Drip,Drip,Drip of $$$$$$$$$$$$$ down the road shortly. Arcon Energy, Inc. is a diversified energy Company involved in the development and production of what is proving to be the best and most efficient ethanol octane enhancer ever seen in the World's oil and gas industry! We plan to sell DF-144 for $1.20 per gallon. It's easy to determine the cost savings for 60% higher blend value for a price of 10 cents per gallon less!! A typical refinery or blender would use on a daily basis, the following DF-144 additive amounts: a small refiner/blender - 100,000 gallons per day. a medium refiner/blender - 400,000 - 800,000 gallons per day. a large refiner/blender - 1,000,000 - 1,500,000 gallons per day. The cost to produce DF-144 is approximately .80 cents per gallon, while the selling price is $1.20. The use of DF-144 by refiners and gasoline blenders offers much better price performance than MTBE in addition to greatly reducing the environmental hazards. Projections indicate that gross annual sales for each plant will be approximately $150,000,000 with a gross margin of $32,000,000 and net before taxes of $20,000,000. All plants will operate as separate profit centers. Continuous expansion will occur in an orderly fashion as market penetration and demand increases and new markets are developed. We plan for 4 plants in 1998 and 4 in 1999. However, some regional expansion areas such as California could require up to 15 large plants to satisfy the market. With the World rights and patents for DF-144, the Company has the potential to reach $1 Billion in sales by the year 200 with only Two percent of the market! U.S. demand alone for gasoline is 332 million gallons per day. A typical blended gasoline will be comprised of 12% - 24% DF-144, representing an impressive potential market. Based on Arcon's planned growth to eight units over the next two years, with each unit capable of producing 350,000 (plus) gallons per day of additive. Revenues generated from the domestic and international markets can easily reach a billion dollars per year by the year 2000! Midland Inc. / Arcon Energy Home Page: arconltd.com ___________________________________________________ Plant to be online in Sept. 98 and 3 more to follow this year alone. Projections...Assumptions: Selling price of DF-144 = 1.20/gal Pretax Margin = 13.33 % (This is based on Arcon's projection that a plant producing approx. 125milgal/yr will gross $150mil with pretax net of $20mil) Full Dilution = 43mil sh. Tax Rate = 35% Calculator says based on these assumptions EPS = .24/100mil gal. Now, with a larger plant size the margin would increase significantly, but regardless of how many plants they build overall they'll produce X gallons/yr. at Y cost so this seems to be the best overall way to capture the potential returns.