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Tyson’s Renewable Fuel Partner Looks to Future

30 July 2013

US - Syntroleum, the partner of Tyson Foods in the Dynamic Fuels renewable energy joint venture has received unsolicited offers for a takeover.

According to a filing on the US Securities and Exchange Commission, the company has retained Piper Jaffray to evaluate “strategic alternatives to enhance shareholder value”.

Piper Jaffray is evaluating the offer which included the takeover of the company, or its assets or its intellectual property or a combination of the three.

“There can be no assurances as to whether any particular strategic alternative for the Company will be recommended by the Board of Directors or undertaken or, if so, upon what terms and conditions,” Syntroleum’s board said in the SEC filing.

“Syntroleum’s technology portfolio is weighted to the production of drop-in, synthetic fuels – specifically the production of second generation, drop-in renewable products and the conversion of natural gas to drop-in synthetic diesel, kerosene and naphtha (Gas-to-Liquids or “GTL”).

“Margins in both renewable fuels and GTL production are at historically high levels.

“The long run economics of GTL has been significantly enhanced as a result of the revitalization of the North American natural gas industry.

“Given the favorable commercial environment, the Company believes that now is an appropriate time to broadly review its strategic alternatives with respect to its renewable and GTL intellectual property and its ownership and licensing interest in Dynamic Fuels.”

The Dynamic Fuels plant in Geismar, LA is in full standby mode, ready for operations.

On 25 February this year, the Dynamic Fuels Management Committee approved $7.3 million for the procurement and installation of new hydro-isomerization catalyst at the Geismar facility.

The new catalyst was delivered to Dynamic Fuels on 25 June and installation was completed on 28 June.

“While the plant is ready for commercial operation, the Dynamic Fuels Management Committee has not determined a re-start date,” Syntroleum said.

Dynamic Fuels, LLC, a joint-venture of Tyson Foods, Inc., and Syntroleum Corporation, produces next-generation renewable, synthetic fuels from animal fats, greases, and vegetable oils that contribute to our nation’s energy independence and help reduce greenhouse gas emissions.

The company will hold its second quarter earnings conference call on 7 August.

TheMeatSite News Desk

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