Renova Energy (RVA) is a US-based company listed in London which specalises in producing ethanol from grain to add to petrol in order to lower emissions. Already profitable, turnover is expected to leap over the next couple of years as US legislation (passed yesterday - see RNS) requires a big increase in the use of ethanol based fuel. With enviromental rules tightening this Company could be in for a very profitable time. As usual DYOR.

This looks like a seriously big US-operation...the problem is will tere be any profits for us Brits?
The Co raised a lot of money (twice?) on AIM and some foolhardy types were prepared to pay GBP2 for the stock and even now at 88p I'm not convinced there aren't better investments about. Woolworth can be looked at, just go in...and has a reasonable yield - - if management could only get to grips with the product-mix it should surely move up? (WLW is about 29p) - so here we ahve a US-based co subject to US Legislation (Oops, look at PartyGaming!) and no profits returned to shareholders.
If there is a [RVA]-turnaround ...(looking at the charts) - I can't see it.

on the way up?

these got a kicking today.............does anyone think these will recover?

i bought in at 90p some time ago

The graph is relentless - 46.5p now.

no probably not scott. GTL have far stronger and more profitable plant and are heavily on the slide. if you like ethanol as a sector you'd be better switching but neither i would advise as a buy just yet.

Suspended at 33.5p...


Renova Energy plc
17 December 2007

The Company has today requested that the trading of its ordinary shares be
suspended with immediate effect pending clarification of its financial position.
The Company has identified cost overruns in relation to the construction of its
new ethanol facility at Heyburn, Idaho, and a further announcement will follow
as soon as possible.

Now 12.5p due to costs overrun of US$11 - 13 million - bad management...


Renova Energy plc
07 January 2008

Renova Energy plc ('the Company' or 'Renova')

Project costs and funding update

At 12.30 p.m. today, the suspension of trading on AIM in Renova Energy plc's
(RVA:AIM) ordinary shares will be lifted.

Renova, the ethanol production, distribution and marketing company, today
provides an update on the Heyburn project and the Group's financial position.

Over the course of 15/16 December 2007, Renova identified cost overruns in
relation to the construction of its combined ethanol and power plant at Heyburn,
Idaho, and a resultant funding shortfall to achieve completion of this project. The Company's shares were suspended from trading on AIM on 17 December 2007 pending further investigation and clarification of the issue.

A preliminary investigation by Renova has revealed cost overruns of approximately US$11 - 13 million which would take total project costs to US$57 - 59 million if the project were to proceed on the current schedule to start-up in
March 2008. However, Renova does not have sufficient funds available under
existing bank facilities and from operating cashflow to maintain this schedule.
As a result of this funding shortfall Renova has suspended work on the Heyburn
facility and, as a consequence, it is now in breach of its banking covenants
which were structured around the original project start-up date. Renova has
outstanding term loans under these facilities amounting to US$28 million on
which repayment was scheduled to commence on 30 June 2008 but, as a result of
the breach in banking covenants, this is now repayable on demand. Renova is in
discussions with its bankers regarding a rescheduling of this debt and the
possible provision of additional facilities as part of a refinancing package,
which is also likely to include new equity capital, to complete the Heyburn
plant.

A further detailed review of the Heyburn project is now underway to identify
project specification changes and other cost savings that could be achieved over
a revised project schedule. The Company has appointed independent consultants to
assist in conducting this review.

New Renewable Fuel Standard

On 19 December 2007, the Energy Independence and Security Act 2007 was passed into law in the US. This new legislation includes a revised Renewable Fuel Standard ('RFS') increasing the mandated usage of renewable fuels in the US to
36 Bgal by 2022. In the near term, the RFS now requires 9 Bgal of renewable fuel
usage in 2008, increasing to 11.1 Bgal in 2009, compared to 4.7 Bgal in 2007.
This legislation significantly increases the demand for ethanol and redresses the ethanol supply and demand balance. Ethanol prices have strengthened as a result of this new legislation.

Current trading

Renova's underlying production and marketing business remains sound. Renova's
operating plant at Torrington, Wyoming, continues to generate positive cashflow.
As previously reported, for the six month period to 30 September 2007, the plant
produced 3.4 MMgal. The programme to increase production capacity at the
Torrington plant to in excess of 10 MMgal/yr is still ongoing and is scheduled
for completion in March 2008.

The distribution business continues to successfully grow with 6.0 MMgal being
distributed through its 14 terminals during the same six month period to 30
September 2007 with an average realised ethanol price of US$2.37 per gallon.
Overall, the US operations generated US$1.9 million in cash during this period.
Sales for the three months ended 31 December 2007 amounted to 3.5 MMgal of
ethanol at an average realised price of $2.10/gal compared to 3.1 MMgal at $1.94
/gal for the same period last year. After a decline in ethanol prices in the
last quarter of 2007, prices have strengthened recently with Renova's posted
terminal prices now in the range of $2.25 - $2.45/gal.

Anyone that invested c.12 months ago has seen this US-based project swallow up98% of their investment ( DYOR). so with the possibility of renegotiating Banking Deals , more share-dilution in effect anyone in then can write this off ( as of Feb2008, say).
All of this is to make green-fuel for a country that doesn't give a fig about energy - and even if the Government does it wants to be re-elected in 4-year's time - - - hardly a good prospect if folk have to stay at home(no flights), put on wooly-hats(in winter) and cycle into town for groceries whilst growing their own healthy veg.

Yes it could be turned-round - - - - but NOT with my money!

Thse small investmentas are doomed to failure, IMHO.

LONDON (Thomson Financial) - Renova Energy plunged 42 percent -- or 3-1/2 pence to 4-3/4 -- after the ethanol production, distribution and marketing company said it is in ongoing discussions with its lenders to restructure the existing borrowings.

The company expects the total project cost of combined ethanol and power plant at Heyburn, Idaho, which has been on hold since December 2007, is now estimated to be $60.1 million.

We drive, they starve. The mass diversion of the North American grain harvest into ethanol plants for fuel is reaching its political and moral limits.

"The reality is that people are dying already," said Jacques Diouf, of the UN's Food and Agriculture Organization (FAO). "Naturally people won't be sitting dying of starvation, they will react," he said.

The UN says it takes 232kg of corn to fill a 50-litre car tank with ethanol. That is enough to feed a child for a year. Last week, the UN predicted "massacres" unless the biofuel policy is halted.

We are all part of this drama whether we fill up with petrol or ethanol. The substitution effect across global markets makes the two morally identical.

Mr Diouf says world grain stocks have fallen to a quarter-century low of 5m tonnes, rations for eight to 12 weeks. America - the world's food superpower - will divert 18pc of its grain output for ethanol this year, chiefly to break dependency on oil imports. It has a 45pc biofuel target for corn by 2015.

Argentina, Canada, and Eastern Europe are joining the race.

The EU has targeted a 5.75pc biofuel share by 2010, though that may change. Europe's farm ministers are to debate a measure this week ensuring "absolute priority" for food output.

"The world food situation is very serious: we have seen riots in Egypt, Cameroon, Haiti and Burkina Faso," said Mr Diouf. "There is a risk that this unrest will spread in countries where 50pc to 60pc of income goes to food," he said.

Haiti's government fell over the weekend following rice and bean riots. Five died.

The global food bill has risen 57pc in the last year. Soaring freight rates make it worse. The cost of food "on the table" has jumped by 74pc in poor countries that rely on imports, according to the FAO.

Roughly 100m people are tipping over the survival line. The import ratio for grains is: Eritrea (88pc), Sierra Leone (85pc), Niger (81pc), Liberia (75pc), Botswana (72pc), Haiti (67pc), and Bangladesh (65pc).

This Malthusian crunch has been building for a long time. We are adding 73m mouths a year. The global population will grow from 6.5bn to 9.5bn before peaking near mid-century.

Asia's bourgeoisie is switching to an animal-based diet. If they follow the Japanese, protein-intake will rise by nine times. It takes 8.3 grams of corn feed to produce a 1g of beef, or 3.1g for pork.

China's meat demand has risen to 50kg per capita from 20kg in 1980, but this has been gradual. The FAO insists that this dietary shift is "not the cause of the sudden food price spike that began in 2005".

Hedge funds played their part in the violent rise in spot prices early this year. To that extent they can be held responsible for the death of African and Asian children. Tougher margin rules on the commodity exchanges might have stopped the racket. Capitalism must police itself, or be policed.

Even so, the funds closed their killer "long" trades in early March, causing a brief 20pc mini-crash in grains. The speculators are now neutral on the COMEX casino in New York.

They have undoubtedly bid up the futures contracts, but the FAO says this has no durable effect on food prices. These index funds never take delivery of grains. All they do is distort the shape of the maturities curve years ahead, allowing farmers to lock in eye-watering prices. That should cause more planting.

Is there any more land? Yes, in Russia, Ukraine, and Kazakhstan, where acreage planted has fallen 12pc since Soviet days. Existing grain yields are 2.4 tonnes per hectare in Ukraine, 1.8 in Russia, and 1.11 in Kazakhstan, com-pared with 6.39 in the US. Investment would do wonders here. But the structure is chaotic.

Brazil has the world's biggest reserves of "potential arable land" with 483m hectares (it currently cultivates 67m), and Colombia has 62m - both offering biannual harvests.

The catch is obvious. "The idea that you cut down rainforest to actually grow biofuels seems profoundly stupid," said Professor John Beddington, Britain's chief scientific adviser.

Goldman Sachs says the cost of ethanol from corn is $81 a barrel (oil equivalent), with wheat at $145 and soybeans $232. It is built on subsidy.

New technology may open the way for the use of non-edible grain stalks to make ethanol, but for now the only biofuel crop that genuinely pays its way is sugar cane ($35). Sugar is carbohydrate: ideal for fuel. Grains contain proteins made of nitrogen: useless for fuel, but vital for people.

Whatever the arguments, politics is intruding. Food export controls have been imposed by Russia, China, India, Vietnam, Argentina, and Serbia. We are disturbingly close to a chain reaction that could shatter our assumptions about food security.

The Philippines - a country with ample foreign reserves of $36bn (Britain has $27bn) - last week had to enlist its embassies to hunt for grain supplies after China withheld shipments. Washington stepped in, pledging "absolutely" to cover Philippine grain needs. A new Cold War is taking shape, around energy and food.

The world intelligentsia has been asleep at the wheel. While we rage over global warming, global hunger has swept in under the radar screen.

RNS today is this the end?

This is a good example of bad management - Renova has gone to 3p.