Global Clean Energy Holdings, Inc. (OTCBB:GCEH) issues the
following Letter to Shareholders:
To All GCEH Shareholders:
As President and Chief Executive Officer of Global Clean Energy
Holdings, Inc. (GCEH), I would like to thank you for your continued
support and take time to report on the many achievements we have
accomplished over the past year.
As you know, the recent global financial crisis has affected
most companies, including ours, most specifically in our ability to
raise capital. We used this time as an opportunity to focus on our
existing energy farming operations and to finalize the sale of the
remaining assets of our legacy business.
I am more enthusiastic and optimistic today about this industry,
and the direction we chose than I have ever been. I am so
convinced that we are following the right course and will be
successful in our endeavors that I personally acquired more than 50
million shares of GCEH common stock recently.
Some of our accomplishments since my last letter include:
1. We completed our transformation from a medical
research company to an energy company by finalizing the sale of our
legacy medical assets.
2. We reduced long term liabilities by more than
$2.9 million.
3. We increased our asset base by more than $4
million.
4. We paid off our only corporate-secured loan.
5. We generated net income of $.009 per share.
6. We completed planting of our 5,150 acre Jatropha
farm in Mexico.
7. We acquired an additional 3,500 acres of land in
Mexico through our existing joint venture to expand our 5,150 acre
Jatropha farm.
8. We transitioned from a development-stage company
to an operating company with recurring revenues.
9. We started generating revenues from seeds sales
through our Technology Alternatives, Ltd (TAL) operation in Belize
and our farm in Mexico.
10. We generated development and management fees by providing
management and consulting services to partners and third
parties.
11. We distributed seeds for use in propagation at other
Jatropha farms, and we provided Jatropha oil and biomass for
conversion into fossil fuel alternatives and for combustion
testing.
12. We designed, constructed and began operation of a fully
operational seed oil extraction facility to support our farming
operation in Mexico.
13. We expanded our joint genetic plant research efforts with a
leading U.S. agricultural and plant sciences university, and
established a state-of-the-art field research center for the
continued development of selected high-producing Jatropha
varietals.
14. We raised more than $3.5 million in project financing and
corporate equity.
15. We expanded our Board of Directors to include a seasoned,
energy project developer and operator.
The completion of planting of the 5,150 acre farm that we own in
Mexico, is a significant milestone for the company, and we believe
this makes our Jatropha farm the largest in the Americas, to
date. This tree is very efficient in its ability to convert
sunlight into a liquid and solid fuel on land that is not conducive
to producing other crops. We have planted almost 4 million Jatropha
trees; and if placed end-to-end, at their current spacing of 1.5
meters, our trees would reach from San Diego, CA to Portland, ME
and then down to Washington, DC.
Last month we acquired an additional 3,500 acres in Mexico to
expand our primary Jatropha farm, and we expect to be making offers
on an additional 1,500 acres in the next 60 days. We expect to have
a significant amount of the recently purchased land fully planted
this calendar year. The new land is contiguous to our existing
farm and will provide improved economies of scale and reduced
logistics costs. Preparation and planting costs are expected to be
a fraction of the cost of the base farm as we'll be able to take
advantage of economies of scale as well as prior knowledge and
experience.
Transitioning from a development stage company to a true
operating company is a turning point for our company.
We are now generating recurring revenues from three of our
operating units. We have sold our legacy medical assets,
discontinued any further development activities in that field and
no longer have the on-going costs to maintain those assets. As
a result of our efforts; we can now focus on our core business of
planting oil bearing trees which produce a cost effective renewable
alternative to fossil fuels.
Over this past year, we continued to see a lot of volatility in
energy prices with strong support to the floor price of crude oil
near $80 per barrel. The heated debate over converting food into
fuel continues to burn strong, and we are more encouraged than ever
that our strategy of using non-food based sources for biofuels is
the best approach. Furthermore, the U.S. political and
regulatory arena continues to support biofuels with the U.S. EPA's
National Renewable Fuels Standard (RFS) program, which mandates the
growing use of biofuels and requires suppliers to verify the energy
required to grow their feedstock. This is very good for
Jatropha, as it requires the lowest energy input for the highest
benefit of all the feedstock commercially available today. We are
also seeing growing support internationally for the use of biofuels
produced from non-food based sources and the ban on certain
feedstock which are not beneficial to the environment. We are
convinced, as are most experts that once the world economy
recovers, the demand for crude oil will push significantly higher
and the price will continue to rise. This market dynamic will
improve our revenues and overall business economics. The U.S.
Department of Energy has predicted crude oil prices to rise to well
over $130 per barrel.
We have worked diligently on the refinement of our "Best
Practices Model" for all of our operations and we continue to
invest in the development of our Intellectual Property (IP) through
genetic research, soil science development and improved
agricultural technologies. All of these "Best Practices" and "IP
Development" efforts will have a positive effect on the yield from
our trees, while driving costs down and profit margins up. These
investments will ensure we are well positioned to be the global
leader and low cost producer in this space. As our farms mature and
we continue to aggressively manage all of our operating costs, we
expect to produce Crude Jatropha Oil (CJO) well below $1.00 per
gallon, or less than $42 per barrel.
Today we own more than 8,800 acres of Jatropha farms in Mexico
and Belize. We continue to aggressively prepare land and plant
Jatropha daily. Our target is to more than double our Jatropha farm
holdings over the next year and a half as promised, we have
successfully generated revenue from our Jatropha production and
farm management activities in FY 2009.
We continue to be excited about the positive attention that
Jatropha is receiving around the world. The recent
announcements by General Motors and the Department of Energy for
the continued research into Jatropha, the past NASA space
shuttle flight which carried Jatropha seeds for germination testing
in space, and the continued flight testing of Jatropha based fuels
by a multitude of airlines, solidifies our belief that this plant
has tremendous potential and will continue to attract a lot of
scientific attention and development effort--pushing it forward as
the best commercially viable biofuels feedstock. It is very
likely that the Jatropha curcas tree will be the first tree that is
commercialized utilizing modern day genomics. This is a
tremendous statement. Independent testing of Jatropha oil has
proven it to be the highest quality feedstock for biofuels. Any
negative press that the plant has seen can be attributed to bad
business models, and poor farming and management
methods. GCEH's business strategy and operational processes
are designed so that we do not make those mistakes. We are
confident that our plan is solid and highly scalable.
The environmental and social aspects of our business cannot be
ignored or underestimated. The trees we are planting will
provide significant CO2 sequestration by capturing carbon in the
trees, and the oil and biomass we produce will provide significant
offsets to fossil fuel usage. Finally, there is an added benefit in
that we are using land that has been primarily non-productive and
developing it into working energy farms.
Along with the environmental benefits generated, we are making
enormous social strides as well--especially with our farm
employees. We currently employ in excess of 160 workers
on our farms in Mexico and expect to expand that to more than 300
by the end of the year. Most of these employees are from the
neighboring villages. Most of these workers were unemployed
and many had never been employed before. We are teaching them
a usable trade and helping them become productive members of their
community. They are provided with health insurance and life
insurance and pay taxes, which contributes to their retirement and
social security fund. The workers and their families are
provided with semi-annual vaccinations, vitamin shots and ongoing
health education. The local village that borders our larger farm
was recently provided with a full time doctor and has just ordered
its own ambulance. All farm workers receive their pay
through a direct deposit into a bank account, which is established
for them upon employment. They are able to access their funds at
the bank or through an ATM card and are beginning to develop their
own credit. Most of them had never had a bank account before
working on our farms. These personal milestones have helped
create a sense of pride in our employees. GCEH also
contributes to the community in other ways, such as sponsoring the
local baseball team and providing supplies to the local
schools.
The sense of community is very important to us and remains a
central part of our business.
This is a very exciting time for us and the industry. We
wanted to thank each of you for your continued support, and I look
forward to reporting to you on our further accomplishments as they
develop.
Sincerely,
Richard Palmer
President and Chief Executive Officer
Global Clean Energy Holdings, Inc.
About Global Clean Energy Holdings
Global Clean Energy Holdings, Inc. is an emerging renewable
agri-energy company focused on the production of non-food based
feedstock used as replacement for fossil fuels. More
information regarding Global Clean Energy Holdings, Inc. can be
found at www.gceholdings.com
Caution Regarding Forward-Looking Statements
Any statements in this letter about Global Clean Energy
Holdings, Inc. expectations, beliefs, plans, objectives,
assumptions or future events or performance are not historical
facts and are forward-looking statements for purposes of the
Private Securities Litigation Reform Act of 1995 (the "Act"). These
statements are often, but not always, made through the use of words
or phrases such as "believe," "feel", "will," "expect,"
"anticipate," "estimate," "intend," "plan," "forecast," "could,"
and "would". Examples of such forward looking statements include
statements regarding the timing, design, scope, and anticipated
results of its efforts to plant, harvest, and commercialize
feedstock oil from Jatropha curcas in Mexico. Global Clean Energy
Holdings bases these forward-looking statements on current
expectations about future events. They involve known and unknown
risks, uncertainties and assumptions that may cause actual results,
levels of activity, performance or achievements to differ
materially from those expressed or implied by any forward-looking
statement. Some of the risks, uncertainties and assumptions that
could cause actual results to differ materially from estimates or
projections in the forward-looking statement include, but are not
limited to, the risk that we might not be able to raise sufficient
funds to develop the Jatropha plantations in Mexico, that we may
face delays or other difficulties in acquiring and cultivating
Jatropha farm lands in Mexico, that we may not be able to
successfully commercialize Jatropha oil as expected, that the
market for our Jatropha products will not grow as expected, and the
risk that the Mexican Jatropha project will not achieve
expectations because of the risks normally associated with creating
a new business in a new market. For additional information about
risks and uncertainties Global Clean Energy Holdings, Inc. faces,
see the documents that Global Clean Energy Holdings, Inc. has filed
with the SEC. Global Clean Energy Holdings, Inc. claims the
protection of the safe harbor for forward-looking statements under
the Act, and assumes no obligation and expressly disclaims any duty
to update any forward-looking statement to reflect events or
circumstances after the date of this news release or to reflect the
occurrence of subsequent events.
CONTACT: Global Clean Energy Holdings, Inc.
Merilee Myers
mmyers@gceholdings.com
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