Q1 2025 Aemetis Inc Earnings Call
Speaker Change: Good day, everyone. Welcome to the Aemetis First Quarter 2025 Earnings Review Conference Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation.
Speaker Change: If anyone should require operator assistance during the conference, please press star zero on your telephone keypad.
Speaker Change: As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Mr. Todd Waltz, the Executive Vice President and Chief Financial Officer of Aemetis. Mr. Waltz, you may begin.
Todd Waltz: Thank you, Kelly, and welcome, everyone. Before we begin, I'd like to remind everyone that during this call we'll be making forward-looking statements within the meaning of the Private Security Litigation Reform Act of 1995.
Todd Waltz: These statements are based on our current expectations in belief and involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements.
Todd Waltz: These risks and uncertainties include but are not limited to those factors discussed in our earnings release issued today and in our most recent form 10k filing with the Security and Exchange Commission under the caption, risk factors and management discussion and analysis of financial condition and results of operation.
as well as in our other filings with the SEC.
Todd Waltz: We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future developments, or otherwise, except as required by law. Please refer to our earnings release and our SEC filings for a more detailed discussion of the risks and uncertainties.
Todd Waltz: Full financial details can be found in our Q1 2025 earnings release, and Form 10Q available on the Amitis website and Edgar. I'll briefly highlight the key items.
Revenue. Revenue's were $42.9 million down from $72.6 million last year.
Todd Waltz: primarily due to delayed biodiesel contracts in India. That business resume shipments in April and we expect Revenue to rebound beating flea in Q2.
Todd Waltz: The Keys ethanol plant saw a revenue lift of 1.7 million dollars due to stronger ethanol pricing and R&G volumes were up 17% year over year.
Todd Waltz: Operating loss was $15.6 million, reflecting a $1.6 million increase in S-GNA, mostly legal and transaction costs associated related to the $19 million of cash we received from selling investment tax credits.
Todd Waltz: that cost will my return at the same level going forward.
Todd Waltz: Interest expense rose to $13.7 million in line with our capital structure and investment base. We reported in that loss of $24.5 million roughly flat versus Q1 last year.
Todd Waltz: Cash at the end of the quarter was $500,000 following $15.4 million of debt repayment and $1.8 million of investment into carbon-intensity reduction and dairy RNG expansion.
Speaker Change: As Eric will describe shortly, we expect multiple revenue streams from India, LCFS credits, and federal tax incentives to ramp up the year as the year progresses, positioning us for a stronger back half of 2025.
Todd Waltz: Now, I'll turn it over to Eric McAfee or Chairman, CEO . Next, Todd, let me start with an update on our three core businesses, Dairy RNG, California ethanol and India biofuels.
Eric McAfee: In our dairy R&G business, we're scaling gas production quickly. We expect to reach 550,000 MMBTUs of production capacity this year and grow to 1 million MMBTUs annually by the end of 2026.
Eric McAfee: We're now operating our building at 18 Derries, backed by $50 million of USDA guaranteed financing.
Eric McAfee: Seven of our dairy pathways have completed third-party verification and are in final review at CARB, with approvals expected this quarter, unlocking meaningful LCFS revenue starting in Q3.
Eric McAfee: At our ethanol plant, we've begun offsite construction of the $30 million mechanical vapor reconpression system.
Eric McAfee: This project is expected to reduce natural gas use by 80%, and add in estimated $32 million in annual cash flow starting in 2026.
Eric McAfee: We've already secured $20 million in grants and tax credits to help fund the system. Now, the malpricing has strengthened since earlier this year, and the recent EPA approval of summer E-15 blending provides tailwinds for margin expansion.
Eric McAfee: In India, we resumed biodiesel deliveries to government oil marketing companies in April , following a six month pause in OMC purchasing.
Eric McAfee: New OMC tenders have been issued and the business remains EBITDA positive and self-funding. We're preparing for an IPO of our India subsidiary targeting late 2025 or early 2026 and evaluating expansion into RNG and ethanol production in that market.
Looking at three future projects.
Eric McAfee: Sustainable Aviation Fuel, we've received air permits and other permits for a 90 million gallon per year, SAF and Renewable Diesel Facility at the Riverbank Site.
Eric McAfee: When operated solely for SAF, capacity will be approximately 78 million gallons per year. We are in active discussions on financing structures and are awaiting further clarity on the 45-C tax credit and state level SAF mandates to support project financing.
Eric McAfee: In Carbon Capture, at our Ruper Bank site, we've completed initial drilling and pipe installation for our CO2 characterization well.
Eric McAfee: The data we obtained from the next phase of drilling will support our Classics sequestration permit application Once permitted the site is expected to sequester up to 1.4 million tons of CO2 annually
Regulatory Tailwinds, Support Strong Growth Outlet
Eric McAfee: position to benefit from a range of federal and state policies that directly enhance the value of our low carbon fuel operations.
Eric McAfee: The California low-carbon fuel standard, amendments adopted by CARB to establish a 20-year framework for reducing transportation fuel emissions are expected to become effective within the next few months.
Eric McAfee: Credit prices are expected to rise significantly as credit supply tightens and credit demand increases. What's provisional LCFS pathways are approved, a metaspod gas could generate over $60 million annually from LCFS credits alone.
Sutter-O, Renewable Fuel Standard [inaudible]
Eric McAfee: The sale of Renewable National Gas Qualifies for D3 Rins, adding $28 to $40 per MMBTU in value. When combined with LCFS, Creditsist represents up to $100 million in potential revenue from RNG in 2026.
Section 45Z, Production Tax Credit.
Eric McAfee: In fact, in January 125, this new federal incentive supports low-mission ethanol and RNG production. Amitis is currently applying treasury guidance to calculate and market these credits with additional clarification expected later this year.
Section 48 Investment Tax Credits
Speaker Change: received $19 million in cash proceeds in Q1 2025 from the sale of solar and biogas related investment tax credits. The company expects additional sales of both investment and production tax credits in 2025.
Speaker Change: E-15 Ethanol Blend Expansion. The EPA has approved summer use of E-15, a 15 percent blend of ethanol in 49 states, and new legislation is advancing to allow year-round use, including in California.
Speaker Change: This would expand the U.S. ethanol market by more than 600 million gallons annually and lower fuel prices for consumers.
Speaker Change: In California, Governor Newsom has directed CARB to expedite the process for allowing the sale of E-15 gasoline in the state, and the state legislature is currently considering conforming legislation.
Speaker Change: Today, California is the only U.S. state that does not allow the sale of E-15 gasoline. Implementing E-15 in California will increase domestic U.S. demand for ethanol by over 600 million gallons annually.
Speaker Change: These aligned policy developments are expected to significantly strengthen Aemetis' revenue, cash flow, and project economics across its Renewable National Gas, ethanol, carbon capture and SEF segments.
Speaker Change: Looking ahead to full year 2025, we expect a significant ramp in RNG revenues starting in Q3, driven by LCFS pathway approvals and rev, and volume growth.
India revenues are recovering with resumed biodiesel shipments.
Speaker Change: Ethan on margins will be supported by policy tailwinds in the near term and by the significant reduction in costs and increases in revenue planned from our NVR project beginning in 2026.
Speaker Change: We are monetizing tax credits and advancing development stage projects, including SAF and carbon capture. Aemetis is positioned for growth and improved cash flow in the second half of the year and continuing through 2026.
Now let's take questions from our co-op participants.
Thanks!
Speaker Change: Thank you, Mr. McAfee. We will now be connecting a question-answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue.
Speaker Change: For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we pull for any questions.
Speaker Change: Your first question is coming from Sumaya Jane with UBS. Please push your question, your line is live.
to my, your vine is life.
Sumaya Jane: Hi, I was wondering how are you guys looking at the impact of tariffs on R&D production for 2025 and 2022 and how that's also playing out on the fast-fighted thing?
Sumaya Jane: RNG value chain is almost entirely domestic, our feedstock is produced by Derrick's [inaudible]
Sumaya Jane: in California are operating costs or primary electricity we get from our local.
Supply Chain, which is actually Hydroelectric in California.
Sumaya Jane: and our customers are all California trucking companies and fueling stations, so the actual direct business is all domestic.
Sumaya Jane: We do have construction and we so far have qualified for domestic content on all of our capital equipment investments and so we are largely domestic in our supply chain for investments so RNG is a very domestic business I would anticipate no direct impact.
Sumaya Jane: Sustainable Aviation Fuel, as an operating activity is anticipating to use domestic feedstocks and sell to airlines in California. Our contracts all have delivery into San Francisco airport and we'd be shipping using our renewable natural gas trucks which are again California located. I think the investment in the capital construction may have some indirect impacts from tariffs.
Sumaya Jane: These sterif burdens have been changing daily, so by the time I think we're actually doing these purchases, I think we'll have a substantially different picture of what the sterif impact is. It'll primarily just be on the one time purchase of capital equipment if we do any offshore work.
Speaker Change: Okay, great. And then how are you guys, I guess, what is driving the improvement in the balance sheet that you're forecasting and like, how's the debt outlook for 20 to 25?
for joining us today.
Speaker Change: Well, we paid off 15.5 million of debt in the first quarter of this year and then to Spade Lou will continue to be doing that through the next three quarters of the year.
Speaker Change: That is primarily from the benefits of investments we're making. We get investment tax credits from those investments.
Speaker Change: And then secondly, we are anticipating both the low carbon fuel standard seven dairy pathways to be approved.
and the 20-year...
Speaker Change: A mandate that's under the LCFS amendment could be adopted sometime over the next couple quarters, both of those together substantially increase our LCFS revenues.
Speaker Change: and substantially as in 120% for those seven deris just in terms of number of LCFS credits and then if those credits go up anywhere from 20 to 50% of course that's compounded against the 120%. So dramatic increase
Speaker Change: And then the third element there is additional derries coming online. We have four derries slated to come online this early the summer and that of course is additional revenue. We also have an India IPO we're actively working on.
Speaker Change: And that will put a lot of cash on the balance sheet as well as put us in position to reduce that and then the last point is actually probably the most important point.
Speaker Change: and that is starting January 2025, the 45Z production tax credit, not investment tax credit, but production tax credit started.
Speaker Change: and we are currently working on marketing our first round of production tax credits. This is revenue for both our ethanol business as well as our biogas business and will significantly increase our ability to pay down debt during 2025 and 2026 as we ramped.
Todd it, thank you.
Thank you so much.
Speaker Change: Your next question is coming from Matthew Blair with TPH. Please pose your question your line is live.
Matthew Blair: Great, thank you very much. I had a question on the Dairy R&G off-ex. It looks like off-ex per MMBTU has been trending in the $29 to $30 per MMBT ranges the past few quarters.
Matthew Blair: Is that a good long-term target, or do you expect that to come down when you have the new Derries up and running, and if so, what's a good long-term target for Derri R&G off X?
Matthew Blair: Our initial op-ex as a percentage of production has been inhibited because we've been in the startup phases.
Matthew Blair: of the Derries Wooden Ring, bringing online. And so, our operating costs include actually the digesters that aren't generating any MMBTs at all yet.
Matthew Blair: So, I think we're going to be seeing a dramatic decrease in Opex Perr.
MMBTU as the MMBTU's increase.
Matthew Blair: The factor there, by the way, is we're in the winter. And the winter are productions significantly last because it's colder and microbes just don't produce as much RNG. So just the natural function of seasonality would...
Matthew Blair: Cut that almost in half just because you're doubling your M-A-B-T's without doubling your staff.
Matthew Blair: and I would remark that we have built out a strong team that operates our own digesters.
Matthew Blair: and we do very little outside contracting related to operations and so our team is scaling up not just the
Matthew Blair: 16 Digestors were scheduled to have by the end of this quarter, but frankly 50 Digestors. So you'll see our op-x is operating on the idea that we're scaling rapidly.
Speaker Change: Sounds good. And then Eric, you mentioned that ethanol margins are improving in the second quarter, and we are seeing better ethanol prices, cheaper corn costs. Do you think that your California ethanol segment is on track for an EBITDA positive quarter, or is that that may be a little too much to ask?
Speaker Change: It's all about demand. The E15 approval happened last week. And ethanol is a national market, as you know. So with more ethanol being exported, we set a new March record for ethanol exports with 155 million gallons.
and we...
Speaker Change: I expect E15 to increasingly be adopted because the EPA not only assured that this year we'd have not just the short waiver they provided but all throughout the summer we have the waiver.
Speaker Change: and they also stayed there to have every intention to get it approved, so next year no waivers are required. So E15 is an underlying what I would call incoming tide that's going to lift all boats.
Speaker Change: So, the combination of seasonality where people just drive more during the summer and the 15 adoption.
is a generally positive trend.
Speaker Change: Our margins are based on the delta between corn and ethanol as you know, so currently the corn prospects are moderate but not bullish and ethanol margins I would say are more on the bullish side, so in general I would think a strengthening trend which we see almost every year, we'd expect to see again this year.
Grace, thanks for your comments.
Thank you, Pat.
Speaker Change: Your next question is coming from Sameer, Josie with H.C. Wainwright. Please pose your question. Your mind is live.
Samir Josie: Hey, good afternoon and good morning, Todd Eric. Thanks for taking my questions.
Samir Josie: I think I heard you while describing the India business IPO later this year or the next year, but you also mentioned potential of RNG and ethanol in that market. Can you please elaborate or give some color on that?
Yes, and I actually appreciate you bringing it up.
Samir Josie: Our current business in India is a dominant biodiesel facility. We have 80 million gallons a year. We sell the product for roughly $3 to $4 a gallon, depending on markets, but usually it's about $4 a gallon, including glycerin.
Samir Josie: So you take 80 and multiply it, that's four, it's a 320 million dollar revenue business in India that is well established. We did 112 million dollars as of the end of September last year in the trailing 12 months. And so it's a it's a it's plenty, it's probably large to get a successful IPO done.
Samir Josie: But our parent company has extensive experience in ethanol, where the largest ethanol producer in California won the largest in the West United States, of course.
Samir Josie: and in Biogas, which has been for us a very, very successful venture in terms of new market position and signing 50 areas, etc.
So, in our India business, we are very proactive.
Samir Josie: Proactively looking at Renewable Natural Gas opportunities and frankly ethanol. Ethanol is a favorite of the India government. It's a domestic feedstock. It counts from either sugar cane or corn. They call it called Maze in India.
Samir Josie: Orn has a benefit of providing about 20% of it, 28% of the feedstock becomes an animal feed that's the distiller's grain that helps farmers and so not only is corn grown by farmers, but then it feeds livestock in India. It's sort of a double benefit to the farming community. [inaudible]
Samir Josie: and that is as a result in a lot of political power and the consumption of ethanol hit 19.4% in 2024 in India and they've set a new target of 30% over the next 60 months.
Samir Josie: So the ethanol business in India has also the benefit that the government sets a minimum price for corn and then sets a minimum price for ethanol in order to provide new markets for corn and in the country and so we see the same
Samir Josie: Opportunities in Biogas, they set a threshold price on a renewable natural gas that is very attractive. And so, being in a strong position, we decided that diversification is something we have built the technical competence as well as the market position to be able to take full advantage of. And the timing of that is designed to help our IPO valuation. So we have specific projects we're reviewing right now.
Samir Josie: We expect over the next two quarters to announce what those projects are and to have a diversified IPO of a rapidly growing company in India with truly exciting prospects.
Samir Josie: Anne's strongly supported by the India government because of the benefits to the agricultural sector in India.
Yeah, no, thanks for that color. It makes sense.
Speaker Change: Just to follow up on India there, there's trouble on the border there right now. Do you expect any, any, any just early days and maybe it will subside? But do you see any hiccups that could arise because of that development?
Speaker Change: We're down on the east coast and the southern part of east coast, then I just read that so we're about as far from it as you can get without doing swimming in the ocean. We're up in the ocean.
Speaker Change: So it's had no impact on us including our supply chain or customer base. It's just that it had no impact at all
Speaker Change: and I've watched the same news reports you have, the Indian government is working diligently to try it.
Speaker Change: Deescalate. This is a flare-up that I don't think either side needed or wanted.
Speaker Change: But I don't expect it to last very long and I do expect it to be resolved favorably for both parties by just saying don't shoot at each other. They're not going to become friends, but they're not going to see a benefit from a military skirmisher. Thank you.
Speaker Change: In addition to the $31 million that order from the biogas, for the biogas in India, do you expect another round before the before like faint fall or something or you don't see that happening?
31-million-dollar order is through the month of July .
Speaker Change: So our shipments started basically the last week of April , but mostly it's May, June and July . We are pressing as the industry is.
Speaker Change: to not see a repeat of what happened to us in the fourth quarter of 2024 and the first quarter of 2025 and so the
Speaker Change: The delay that occurred there were not looking to repeat and I think the oil marketing companies and the government are now highly not certainly very aware and I would even say sensitized. [inaudible]
Speaker Change: to the need to keep the orders flowing in order to not have this sort of an industry production gap that happened.
Speaker Change: And this is it. This one last question, and I know you talked about in addition to in response to previous questions.
Speaker Change: about reducing debt. But the EB5 and maybe now the gold card that Trump is proposing has proposed, does, are there any opportunities where you can get cheaper debt from those sources?
Speaker Change: Yes, and we announced last year that we are approved now for $200 million, the EB-5 financing
Speaker Change: Interest costs are less than 3% on those funds and it's subordinate debt so we can do senior debt on top of it.
Speaker Change: We are seeing some very active EB-5, and it's a combination of enforcement of immigration rules in a way that we haven't seen for a while.
Speaker Change: And so people here on their work visas and student visas are looking seriously about whether they want to stay for a while.
Speaker Change: and EP5 is really the only program available to really assure them of not having a loss of immigration rights.
and then secondly, interestingly enough, in India.
Speaker Change: The stock market has done very, very well, and so we're seeing many more Indian families that just have the financial capacity.
Speaker Change: to have their kids go to school in the US or already going to school and already have family here. And so EB5 is, I think, just more affordable than maybe perhaps four or five, six years ago. So that combination together is brought a number very. Thank you.
Speaker Change: Coactive Investors to us and we continue to work on closing our next round of BB-5 Investors.
Good. Thanks, Eric, for taking my questions.
Good. Thank you.
Speaker Change: Your next question is coming from Derrick Whitfield with Texas Capital. Please pose your question your mind is life.
Derek Whitfield: Good morning, Eric, good to meet you, and thanks for taking my questions.
and Derek.
Derek Whitfield: Eric, could you update us on the progress of 45V as you understand it with respect to timing of final rules from Treasury and whether you're expecting a unique pathway for
he is a well-known factor in in Washington and and
Derek Whitfield: I believe that his response to the confirmation question from Senator Grassley was extremely important. Senator Grassley from Iowa, of course, has 42 ethanol plants in his state and specifically asked.
Derek Whitfield: Wood N. Keys as the head of tax policy for treasury, not wait for new legislation, not wait for new regulation to be issued by Treasury, but instead take the existing law passed in 2022, the regulations issued in January 2025.
Derek Whitfield: and Implemented. And the response in writing from Ken Teeze was, yes, I will do so.
Derek Whitfield: And what it was referring to was the Provisional Emissions Rate.
Derek Whitfield: which, from biogas, is a very large number compared to the emissions rate that is a default in the Greek model. The emissions rate's default was the Department of Energy and EPA calculating all the methane emissions from all the animals in the US.
Derek Whitfield: Divided by all the animals, all the chickens and ducks and turkeys and everything else were divided into the emissions so the loser in that calculation which for us was ends of being about a negative thirty three carbon intensity. [inaudible]
Is Derrick
Derek Whitfield: Darries produce a lot more manure and then do an excellent job of capturing it and converting it to valuable vehicle fuel so our
Speaker Change: carbon intensity in California. Under the California agreed is a negative 380, not a negative 33. So for us our focus has been on getting the provisional emissions rate process to work. We have Ken joining the.
Speaker Change: Treasury is early as next week and his task is going to be to figure out how to get a PER process to work which they promised in January and we are certainly looking for that to be a short process. The benefit for us would be
of
Speaker Change: Significant increase in the value of our RNG molecule. Currently, we've got $14 an MNBTU and we would expect a very significant increase in terms of 5x plus multiple of that in terms of the provisional emissions rate.
Speaker Change: Yeah, Eric, just to put a bow in that, I mean, you guys will be looking at something North that's $60 per year on BTU. It all depends on conversion, but just playing the math of the PR at your negative 380, it's a big number.
Speaker Change: It is, and actually there's three numbers, the third one's a dollar, the first one's a number of gallons.
Speaker Change: The second's the emission rate. Well, emissions rate times a dollar, we get that. But they're currently calculated the number of gallons of 7.8.
Speaker Change: Gallons per Million British Civil Units, well the same federal law, the same month we calculate our D3 Rins of the Renewal Field Standard at 11.7.
Speaker Change: So, strangely enough, two federal laws at two different number of gallons were delivering into a truck.
Same truck.
that consistency needs to get rectified.
Speaker Change: And so we're looking actually at 11.7 times our emissions factor times a dollar is what the actual calculation should be.
Speaker Change: I think it's going to have to be baby steps. We get the emissions rate correct, and then we'll probably have to get Treasury guidance.
Speaker Change: to get the energy density corrected, but we can sell multiple rounds of tax credits on the same molecule, so we're not prohibited from selling at this current rate and then at the higher rate as they get their calculations to work.
Speaker Change: Very helpful. And then with my follow-up, I wanted to lean in on ethanol fundamentals. While there are several variables that play with ethanol, do you have a view on ethanol and coin crash margins in an environment where E-15 were adopted across 49 states?
Speaker Change: Andy, you want to take that? Well, the waiver that was provided by the EPA certainly is positive. It's not new, as you know, they've provided the waiver previously, so I think it provides a level of certainty as we go into the summer.
Speaker Change: I think the thing that we're kind of keeping our eye on is being that one hold out state, California.
Speaker Change: being the only state in the U.S. that's not allowed to sell E-15 gasoline. The governor has made it clear that he wants carb to expedite the process.
Speaker Change: The legislature seems very open really more so than we've ever seen before. There seems to be a good deal of support with that.
Speaker Change: And, you know, adding E15 in California would be a huge boost to all USF and all producers, but certainly us in California would be a real benefit.
Speaker Change: I think, you know, corn futures have come down quite a lot this week, which is, you know, not good for producers, but good for buyers us.
Speaker Change: Ethanol was remain relatively stable, you know, trading in about a six to eight cents ban for the last, call it 45 days.
Speaker Change: Typically that does strengthen as we get into the summer and I think the other thing that we've noticed in the last couple of weeks is there's been a drawdown in inventory which is necessary and has been good. We still have a fair amount of inventory nationally that we need to choose through. Thank you.
Speaker Change: But as you know, Derrick, ethanol exports are well on pace this year to be smashing the record. So, yeah, those combinations together, and I think the...
Speaker Change: The near term outlook is, you know, is better. And then for us, you know, getting our MVR system installed, you know, speaking just about a medicine, not the ethanol industry as a whole.
Speaker Change: We'll have a dramatic impact on our carbon intensity score. So, you know, you add those things together. I think the outlook from a cash flow perspective in the ethanol business is very positive as we head into 2026.
Speaker Change: It's great, a lot of potential. Until once for you guys, I'll turn it back to the operating.
Thank you.
Speaker Change: Your next question is coming from Dave Storms with Stonegate. Please pose your question. Your vine is live.
Morning, everyone.
Speaker Change: I just want to start with a quick modeling question. Are there any investment tax credits that you have left to sell in 2025? And just any thoughts on how many investment credits you may generate in the remainder of the year?
Speaker Change: We definitely have a sale actually in process for ITCs. These lag the completion of the project that's called the in-service state.
Speaker Change: because of the various documentation you have to pull together, so there's up to a six month or more lag.
Speaker Change: between completing the actual project. So we will be bringing projects online in the next couple months and then set a project later on this year. So I expect probably another couple of ITC sales during the course of this year. And then.
Speaker Change: Probably even more important to the company's cash is 45 z-sales, and if we can get provisional missions right, we'd be looking at some of those in the next couple months.
Speaker Change: and that will be an ongoing process, which I expect would be at least quarterly to get our 45-Z production tax credits monetized.
Speaker Change: and Q. Just remind us, once your digesters are approved and achieve that full approval, is there a look back on the carbon intensity for credits that have been generated in the last six months of years like any look back like that?
Speaker Change: Andy, do you want to talk about them? Yeah, one quarter is the lookback period, depending on what the date is when we receive.
Speaker Change: The final approval. We've gone back and forth with CARB on a couple of minor RFIs, and we're expecting that approval to happen, hopefully this month in the next couple of weeks. And this because from a modeling perspective, I want to make sure you get this clarity.
Speaker Change: We do expect to be approved this quarter for the first seven derries. It'll be a first pathway of approval. We've heard God in which it's a little slow. It'll have taken us by two years.
By the time we do work.
Speaker Change: Conference Paul for the second quarter will be able to tell everyone exactly how much we monetized.
Speaker Change: But it'll show up in third quarter revenues. So from a process perspective, it will be for the first quarter's production approved in the second quarter. And then very early, like the one week into the third quarter, we will show it as cash on our account.
Understood. That's very insightful. Thank you for taking my questions.
Sure. Thank you, Dave.
Speaker Change: And your next question is coming from Ed Woo with the Sendient Capital. Please pose your question in your line of life.
Ed Wu: Yeah, congratulations on all the progress. And, you know, especially on the INNI IPO, what you said is going to be late this year, early this next year. Have you decided what you're going to be doing with the proceeds? Is there any plans for significant expansion into, like I said, RNG or into, you know, sustainable aviation fuel? Yeah.
Ed Wu: Our India IPO proceeds will be primarily focused on building up the India business. We're also going to be putting a cash balance.
Ed Wu: that historically we've not run at the company, certainly we try to pay down our expensive debt, but I would expect we'll end up with a significant cash balance which will show up on the parent company consolidated balance sheet.
Ed Wu: And then I would expect a certain amount of the money would be repayment of parent company debt. So when we get repaid from India for amounts we've advanced the India we would then use it to repay our parent company debt.
since we're talking about...
Debt Repayment, we do have-
Ed Wu: Not only investment tax credits, but also loan refinancing that we're working on. A debt repayment for us is a very high priority and we expect later on this year to cease. It continued progress, not only paying down interest to principal, but also refinancing in the lower cost financing.
Speaker Change: Great. Thanks for answering my questions and I wish you guys good luck. Thank you.
Thank you, Ed.
Speaker Change: We have reached the end of our question and answer session and I will now turn the call over to management for their closing remarks.
Speaker Change: Thank you to Ametis Stockholders, analysts and others for joining us today. We look forward to talking with you about participating in the growth opportunities at Ametis.
Speaker Change: Thank you for attending today's Ametis earnings conference call. Please visit the investor section of the Ametis website where we'll post a written version and an audio version of this Ametis earnings review and business update. Kelly?