Market Snapshot
  • U.S.
  • Europe
  • Asia
Ticker Volume Price Price Delta
DJIA 16,408.54 -16.31 -0.10%
S&P 500 1,864.85 2.54 0.14%
NASDAQ 4,095.52 9.29 0.23%
Ticker Volume Price Price Delta
STOXX 50 3,155.81 16.55 0.53%
FTSE 100 6,625.25 41.08 0.62%
DAX 9,409.71 91.89 0.99%
Ticker Volume Price Price Delta
NIKKEI 14,516.27 98.74 0.68%
TOPIX 1,173.37 6.78 0.58%
HANG SENG 22,760.24 64.23 0.28%

KiOR Announces Project to Double Columbus Production Capacity



KiOR Announces Project to Double Columbus Production Capacity

 $50 MILLION JOINTLY COMMITTED TO PROJECT BY VINOD KHOSLA AND KHOSLA VENTURES

ENABLES LONG-TERM BUSINESS PLAN OF LARGER STANDARD SCALE COMMERCIAL FACILITIES

PASADENA, Texas, Sept. 26, 2013 (GLOBE NEWSWIRE) -- KiOR, Inc. (Nasdaq:KIOR)
announced today that it is pursuing plans to double production capacity at its
Columbus, Mississippi, cellulosic fuels facility through construction of a
second facility incorporating KiOR's commercially proven technology. KiOR
estimates that the project – Columbus II – will cost approximately $225
million, will break ground within 90 days of the Company raising sufficient
equity and debt capital to commence the project, and will take approximately
18 months to construct and start up. Once completed with its latest technology
improvements, KiOR expects that the Columbus II project will allow each
Columbus facility to achieve greater yields, production capacity and feedstock
flexibility than the original design basis for the existing Columbus facility,
enabling KiOR to more quickly make progress towards its long-term goal of 92
gallons per bone dry ton of biomass.

KiOR also announced that it has received commitments, subject only to
negotiation and execution of final documentation, from Khosla Ventures and
Vinod Khosla for an aggregate commitment of up to $50 million as the
cornerstone investor for the Columbus II project and to meet the Company's
ongoing liquidity needs. Khosla Ventures and Mr. Khosla have advised that they
are prepared to fund these commitments either as part of a broader debt and/or
equity financing structure, in connection with a note that would convert at a
premium to the current price of the Company's Common Stock or on alternative
terms if requested by the Company, and mutually agreed by the parties, as in
the best interest of the Company and its stockholders.

Fred Cannon, KiOR's President and CEO, stated, "The Columbus II project marks
an important step in the execution of the long-term business plan of KiOR for
several reasons:

  * First, we believe that this project will enable us to achieve cash flow
    profitability in 2015 at a lower capital cost with decreased execution and
    start-up risk.
  * Second, we expect that construction timing and cost are more certain for
    the Columbus II project, as it is essentially a duplicate of our existing
    Columbus facility that can be leveraged to reduce construction risk.
  * Third, through the Columbus II project we plan to achieve significant
    operational and technological synergies between the two Columbus
    facilities, as we expect to incorporate our most recent technology
    developments into both the new Columbus II facility and retroactively to
    the existing Columbus facility, thereby improving facility economics for
    both Columbus I and II.
  * Fourth, we expect a shorter startup period for the Columbus II facility as
    a result of sharing personnel, infrastructure and operational knowledge
    with the existing Columbus I facility. This expansion of Columbus has been
    partially enabled by significant improvements to our technology that we
    expect will facilitate our use of a wider range of less expensive
    feedstocks such as railroad ties.

"We believe that the Columbus II project also enables KiOR to continue to
execute on our long-term business plan consisting of larger, standard scale
commercial production facilities," continued Cannon. "In parallel with the
Columbus II project, we plan to accelerate our efforts to refine the design,
based on the newest technology improvements, of our next standard scale
commercial production facility, currently planned for groundbreaking in the
second half of 2014 in Natchez, Mississippi. As a result of these additional
efforts, we would expect to improve both the capital and operating cost
profiles of the planned Natchez facility against the estimates outlined in our
last earnings call. We believe these improvements to both capital and
operating costs will enable us to attain financing for the planned Natchez
facility on terms more favorable to KiOR and less dilutive to its
shareholders. We are pleased that Khosla Ventures, our founding investor, and
Vinod Khosla continue to show their confidence in both our progress to date
and our future business through these commitments."

Vinod Khosla stated, "While KiOR has faced normal start-up issues at the
Columbus I facility, I believe that the Columbus I facility has proven that
KiOR's technology can meet and over time exceed the technology performance
metrics of approximately 80 gallons per bone dry ton I expected for 2015,
driving toward the ultimate goal of producing 92 gallons of hydrocarbon fuels
(or over 150 gallons of ethanol equivalent) per bone dry ton of biomass,
particularly given the Company's continued progress in research and
development. I believe that KiOR's proprietary technology platform is
substantially better, and can produce hydrocarbon fuels at lower cost, than
any other currently visible biofuels fermentation technology, cellulosic or
otherwise, that I am aware of.  I expect that cash costs per gallon (excluding
depreciation) on an energy content basis at the two Columbus facilities should
be lower than today's corn based ethanol. I also believe that KiOR's
cellulosic fuels, which have a higher per gallon energy content than ethanol
and can integrate seamlessly into the existing hydrocarbon fuels
infrastructure, will provide a biofuel alternative without blendwall issues
that is more attractive than ethanol, considering both production costs and
logistical efficiencies."  

Concluded Khosla, "I am more excited than ever about KiOR's long-term business
prospects. Given the technical, operational and commercial milestones they
have achieved to date, I am pleased to support KiOR's growth through these
financial commitments to the Company and the Columbus II project, while
providing the flexibility for KiOR to secure market-based financing that will
minimize dilution for all stockholders and to achieve cash flow breakeven with
relatively small amounts of capital. I remain convinced that biofuels are
necessary for America's prosperity and security and my hope is that in this
decade they can match the economics of oil sands and deep offshore drilling,
without subsidies. The biofuels industry, if properly funded, is also capable
of creating more jobs, with unsubsidized economics, than traditional fossil
oil technology and putting every mill town in America with a shut down paper
mill back in business as a thriving community. Technology progress reinforces
my long-term hope that many of today's emerging advanced biofuels technologies
succeed, both cellulosic and other non-food based biofuels technologies. In
the meantime however, I believe KiOR's unique, direct biomass-to-hydrocarbon
fuel production process (e.g., not ethanol or biodiesel) holds the most
near-term promise of being cost competitive and gaining market acceptance.
Though all technology development is risky, biofuels technology progress has
been significant."

About KiOR

KiOR, a global leader in cellulosic gasoline and diesel transportation fuels,
has developed a unique proprietary technology platform to convert abundant and
sustainable non-food biomass into fuels for use in vehicles on the road today.
KiOR's cellulosic fuels, which may be transported using existing distribution
networks, help ease dependence on foreign oil, reduce lifecycle greenhouse gas
emissions and create high-quality jobs and economic benefit across rural
communities.

KiOR's shares are traded on NASDAQ under the symbol "KiOR." For more
information, please visit www.KiOR.com.

Forward-Looking Statements

This release contains "forward looking" statements within the meaning of the
Private Securities Litigation Reform Act of 1995 and Section 21E of the
Securities Exchange Act of 1934, as amended, regarding future results and
events. For this purpose, any statements contained herein that are not
statements of historical fact may be deemed forward looking statements.
Without limiting the foregoing, the words "believes," "anticipates," "plans,"
"expects," "intends," "appears," "estimates," "projects," "would," "could,"
"should," "targets," and similar expressions are also intended to identify
forward looking statements. The forward looking statements in this press
release, including those related to the timing and cost of constructing the
Company's contemplated Columbus II and Natchez facilities, the production
estimates at those facilities, the effects of Columbus II and Natchez on the
Company's cash flows, financial condition and future capital raising efforts,
the effect of Columbus II on the Company's Natchez facility, the
cost-competitiveness and market acceptance of the Company's products, the
effects that improvements to the Company's technology will have on the
Columbus expansion and the ability of Columbus II to leverage resources from
and synergies with Columbus I, involve a number of important risks and
uncertainties, which could cause our actual future results to differ
significantly from the results discussed in the forward looking statements
contained in this press release. Such factors are discussed more fully in the
section entitled "Risk Factors" in the Company's Annual Report on Form 10-K as
filed with the United States Securities and Exchange Commission (SEC) on March
18, 2013, in the Company's Quarterly Report on Form 10-Q filed with the SEC on
August 9, 2013 and in the Company's subsequent filings with the SEC. The "Risk
Factors" discussion in the filings listed above is incorporated by reference
in this press release. In addition, the terms upon which Khosla Ventures and
Vinod Khosla propose to invest in the Company are subject to negotiation and
are not final. There are no assurances that such terms will be favorable to
the Company. Furthermore, the cash from the commitments will be used to meet
the Company's ongoing liquidity needs. The Company's liquidity needs are
subject to change and the amount of the investment commitments may not be
sufficient to meet such liquidity needs. If the timing, structure or terms of
the investment commitments are not favorable to the Company or if the amount
of the investment commitments are insufficient to meet the Company's liquidity
needs, the investment commitments may not adequately address the Company's
liquidity concerns. If any of these risks or uncertainties materialize, or if
our underlying assumptions prove to be incorrect, actual results, levels of
activity, performance or achievement may vary significantly from what we have
projected. We specifically disclaim any obligation to update these forward
looking statements in the future. These forward-looking statements should not
be relied upon as representing our estimates or views as of any date
subsequent to the date of this press release.

CONTACT: For investors:
         Dan Richardson, Vice President, Finance
         281-694-8744
         Investor.relations@kior.com
        
         For media:
         Kate Perez, Director,
         Corporate Communications & Public Relations
         281-694-8831
         Media@kior.com

KiOR Logo
Sponsored Links
Advertisement
Advertisements
Sponsored Links
Advertisement