Greetings ladies and gentlemen, and welcome to the Aemetis First Quarter 2015 Earnings Review Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. 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.

Thank you, Jen. Welcome to the Aemetis March Earnings Review and Business Update Conference Call. Before we begin our presentation, I’d like to read the following disclaimer statement. During today’s call we will be making some forward-looking statements including without limitation, statements with respect to our future stock performance, plans expectations for performance, opportunities and expectations with respect to financing activities. I’d like to remind you that these statements must be considered in conjunction with the cautionary warnings that appear in our SEC filings. Investors are cautioned that all forward-looking statements in this call involve risk and uncertainty and that, future events may differ materially from the statements made. For additional information, please refer to the company’s Securities Exchange Commission filings which are posted on our website or available from the company without charge. Our discussion on this call will include review of non-GAAP measures as a supplement to financial results based on GAAP. A reconciliation of the non-GAAP measures to the most directly comparable GAAP measures is included in our earnings release for the quarter ended March 31, 2015, which is available on our website in the Media section. Adjusted EBITDA is defined as net income or loss plus, to the extent deducted in calculating such net income, interest expense, loss on extinguishment, income tax expense, intangible and other amortization expense, depreciation expense, and share-based compensation expense. Now I would like to introduce the Founder, Chairman, and Chief Executive Officer of Aemetis, Mr. Eric McAfee.

Thank you, Todd. We welcome our shareholders and financial markets professionals to today's Aemetis first quarter 2015 earnings review conference call. For newer investors and participants, we suggest visiting the Aemetis website at aemetis.com to review today’s earnings press release, the updated Aemetis corporate presentation, Aemetis filings with the SEC and previous Aemetis business update conference calls. Todd Waltz, our Chief Financial Officer, will now provide a review of the company’s Q1 2015 financial results, I then will provide a business update, which will be followed by a question-and-answer session. Todd?

Thank you, Eric. During the first quarter of 2015, revenues were $34.7 million down from $60.7 million in the strong 2014 first quarter. In Q1 2015, gross profits were a loss of $200,000 down from $15.6 million in the same quarter of 2014. A key component of reduction in revenue and gross profits was a decline in the sales price for both ethanol and wet distiller’s grains, a trend experienced across the industry, and specifically in California has reduced dairy production and lower feed prices pressure both demand and price were just illustrated. SG&A expenses in the first quarter were $3.6 million in 2015 versus $2.8 million in 2014. The increase in SG&A expense was primarily attributable to a one-time charge by our EB-5 regional center associated with three leases, $17 million upon date to the company during the first quarter of 2015. I will talk more about this program later in this discussion. The operating loss of $4 million in Q1 2015 compares to $12.7 million of operating income during the same period of 2014. A net loss of $8.6 million in the March ‘15 quarter compares to $7.7 million in net income for Q1 of 2014. Adjusted EBITDA during the first quarter of 2015 was a loss of $2.7 million compared to $14.2 million in Q1 of 2014. Interest expense including amortization and loss on debt extinguishment was $4.6 million in the first quarter of 2015, a continuation in this downward trend from $5.2 million during the first quarter of 2014. During the first quarter of 2015, $17 million of low cost EB-5 debt funding was released from the Escrow account to the company, of which $5.5 million was held as cash compared to the $300 million held as cash when we closed in 2014. The balance of…

Thank you, Todd. Aemetis continues to achieve important milestones that are creating significant value for shareholders. For those of you who may be new to our company, let me take a moment to provide some brief background information. Aemetis was founded in 2006, and we own and operate 110 million gallons per year of renewable fuel production capacity in the U.S. and in India. Included in our production portfolio is a 60 million gallon per year capacity ethanol plant located in Keyes, California, which is near Modesto. We also own and operate a 50 million gallon per year capacity distilled biodiesel and refined glycerin biorefinery production plant on the East Coast of India, near the port city of Kakinada. Aemetis was listed on the NASDAQ stock market in June 2014, which is significant for both the company and shareholders as we look to broaden the base of Aemetis investors to include additional institutional investors and to provide greater liquidity to existing shareholders. Since the NASDAQ listing, we’ve been very successful in arranging low cost subordinated debt through the Federal EB-5 Jobs program. With $26 million of funding, consisting of $19 million of cash received by the company and $7 million in escrow. With $10 million in signed agreements yet to fund into escrow plus the $7 million currently in escrow, we expect to see funding of additional $17 million to the company from EB-5 during year 2015. During 2015 we planned to launch an additional EB-5 program to realize low cost funds at a 3% interest rate and with no principle payments due for four years. We believe that the unique ability of Aemetis to create a significant number of new jobs in rural areas and areas of high-end employment, fulfils the goals of the EB-5 program, allowing us to…

[Operator Instructions]. Our first question comes from the line of James Stone with PSK Advisors. Please proceed with your question.

Good afternoon, gentlemen. The first is a rather strange type of question but was there any particularly reason you didn’t mention that there is going to be this Q&A for those who might want to dial-in?

I think it was mentioned early on in the call, but people can dial-in now if the operator wants to repeat the instructions, it might be helpful to everybody.

No, no, I’m not talking about that. I’m talking about in the announcement that you put out, it’s pretty standard that you put it and there will be a conference call and there is none on yours.

Yes, we’ll take a look at that. That must be stated if it’s not in there.

Okay. I just wanted to make sure it wasn’t. Could you give us a little more insight on the biodiesel, the type of the customers you’re looking for, are you looking for small, small customers, medium customers, large customers, what are you looking for and what are you finding as the objectives that because you have a lower price and a better mileage, I would think that everyone would want it. And therefore, what are the objections that you’re seeing?

Our focus has been on both customers, largely that means truck leads and bus leads. The initial market segment has been those who do short-haul trips but they return to the same location they fuel-in everyday with a longer term strategy, what are called long-haul trucks. These are the trucks and buses that do not return to the same location for fueling every day. We have found that we are uniquely positioned and are just still biodiesel which looks potentially like water can be 100% replacement for diesel for these fleets. And so, unlike every other diesel producer at commercial scale in India, we’ve blended to about 20% blend due to the impurities in their biodiesel. We have about five times as much economic impact or have five times of discount if you want it to give that way, by being able to replace 100% of the existing fuel in these fleets. And so, it does require very many of these fleets to have a very significant percentage of our plant capacity. So have, we put the sales structure in place, the sales representatives on the streets, the testing processes largely occurred in the first quarter. And so, our initial customers are already repeat buyers now. But because we sell essentially five times the most biofuels in any single fleet customer, we found that our CLF in India has been a focus on larger bus companies, especially in the travel industry and then the fleet truck operators who have literally hundreds of trucks.

Are these buyers, are they concerned that you might be a sole distributor of this. And therefore only limit a certain percentage of their fuel to you, or are you looking to take over the entire fuel responsibility?

I’m sure that if we were charging a premium price they would be actively seeking other vendors. Currently the business model we have in India is that our price is discounted compared to diesel, but there are other choices to buy diesel which often is of lower quality and has some contamination, which means that they get worse gas knowledge and a higher price of diesel compared to our product. And that’s sort of a general summary statement regarding why our customers are interested in our product. At this point in time, we’re the only acquired distilled biodiesel so it’s not a situation in which as so we’re even competing with the alternative suppliers. Over time, we certainly expect that 25 billion gallon market will be at least one just other supplier in the country, at $3 a gallon, that’s a $75 billion market. And so, we do expect other players. But at the current time, because of the, I guess the foreside of our team in upgrading our facility vehicles to supply European quality product, we saw distillation which removes all these other trace elements is, as it moves away, we can provide a world-class product. And it positions us extremely well as the government policy in India terminated the sub-sea diesel and open up the biodiesel alternative.

Could you give us an inside into the rollout by a typical customer of the use of diesel? And that does, is there any good feeling that I know you’ve said you’ll be at full capacity by year end, but might it the full capacity be at the end of Q3 or something earlier, I’m trying to understand what’s holding that up so to speak?

India is the launch of a new product into a 25 billion gallon market. And it didn’t happen gradually over time, it happened all at once with the removal of the sub-sea diesel, that’s about $11 billion to Europe of diesel and gas time subsidiaries seas that were canceled. And then the approval, the ability for biodiesel producers to sell roughly to both customers, and that is all a recent event in India. So, realistically what we’ve seen is that a few large customers could take a very substantial portion of our plant. There happens to be a, there are three government owned fuel blenders in India, any one of those three government owned fuel blenders could take 100% of capacity of our brand. So we are definitely in the tier location which is really the pace of customer adoption and the pace of us executing on standing at production and deliveries that you would see in any scale-up that we projected originally would take us approximately a year to do. And we are currently on track for us to continue that scale up. Again, any one of these three government fuel blenders, they own the oil refineries and they have announced plans to do for example 5% blend any one of those customers exceeds our production capacity. So it is a very large market and we are continuing to execute on a daily basis to expand our production and deliveries to meet that need.

But I’m just trying to wonder, do we have to wait till the last week of the year for you to get to the full capacity or might we be up at full capacity earlier? What is your feeling on that thing?

My feeling is that customers are ahead of us. I think to be quite frank with you, our customers are becoming extremely excited about how they could convert their entire fleet over to a lower cost, frankly higher quality product that has less emissions and lot of benefits. And so, really this feel up in India is going to be about our execution in acquiring feed-stock and expanding our lines of credit and expanding our production. We are not at strength at this moment, we are not feel into need customer applications but it’s very, very clear that we have a snowball running down hill in India. And as that snowball hits larger and larger of those customers looking to benefit from our product, we very well could find ourselves constrained primarily not by customer demand but reaches by the execution of scaling at the business. Now, of course that’s an excellent problem to have. We originally designed the plant to be 100 million gallons of capacity as a footprint. And we are positioned to be able to expand our production capacity in about 12-month period for about $15 million, which we would give from retained earnings in India according to our plan. So, we’re positioned to be able to sponsor that snowball that rolls faster and faster and gets larger and larger, but we see our channels primarily is our ability to expand our business to meet that demand.

When do you expect to actually begin doing whatever has to be done to doubling your capacity? Is that something that might begin in this quarter or next quarter or are you still waiting before you do it?

We’re going to be waiting to see very clearly the 50 million gallons of capacity we currently have is being executed against. But I think we’re not too far off Jim, we will probably get that kind of visibility this year, I do have an expectation that it would be the second quarter. But sometime in the second half of this year I could see us given that visibility and starting engineering for the expansion and overprice to get ahead with the market.

Okay. I’ll get back in line and let somebody else in at this point. Thank you.

Thank you, Jim.

Thank you. Our next question comes from the line of Scott Ozer with Sandlapper Securities. Please proceed with your question. Mr. Scott Ozer, your line is live.

Can you hear me, hello?

Yes, thanks Scott.

Hello.

Yes, we’re good.

Okay. Is there any kind of hedging strategies that can be employed to reduce the volatility from quarter to quarter, you looked into any of that?

Yes, there is. And actually there are a number of strategies being deployed by other companies in our industry to hedge ethanol to hedge feed-stocks and sometimes to hedge the by-products as well. We I think all expect that the rapid decline in crude oil to a low of approximately $43 on the WTI, it was at the U.S. price of crude oil which has now bounced to top, I think almost 40% to $60 in the last month. It wasn’t anomaly, I think anybody in the oil industry knew it was anomaly, and if they didn’t know it then, they know it now. You cannot track for oil at $40 a barrel, I expect that to be 10 million barrel per day supply-chain at the U.S. So, it’s almost definitional that $43 prices of crude oil will mean that the U.S. production of crude oil will fall dramatically. We were only 5 million barrel per day producer as since four years ago. So, we are in a crude oil business, we are an additive to crude oil, we have a lot of value to crude oil. And we also happen to replace it as launched. And so, this first quarter decline to $43 which was caused by a political decision, perhaps an economic decision by the Saudis, is being reversed. And we’re now at $60 a barrel. I would tell you that it has created a rising tide for our industry because completely separate from crude oil business is the EPA’s enforcement of the rules under which we can distribute our product. And so, it doesn’t matter where the crude oils extend at $20 a barrel or not, we have an expanding market in U.S. under federal law. And so, a simple enforcement of that federal law means that…

Okay. And the extra EB-5 money, when you apply that to the overall capital, have you done some computations of how that should increase our cash flow or revenues or earnings per share?

Yes, it’s pretty straight forward. We have $17 million of additional EB-5 money, little over $7 million of it in escrow right now. And it’s a 3%. So, the additional cash flow was basically the delta, the difference between our existing $17 million with Third Eye and the $17 million we have with EB-5. But there is something that happens that’s pretty obvious which is with our $56 million of EB-5, correction, Third Eye Capital money being reduced by $17 million, the change-up with only $39 million in your tab. And a company with $165 million worth of builds objects, so we then become very much a bankable entity from just commercial bank point of view. And commercial bank loan rates are in the 7% range. So, we’re talking about a dramatic reduction in our overall interest cost with 3% interest rate on our EB-5 money and the balance of our funds at roughly I’d say 6% to 7%. So, that’s really to build the company, it’s not just to pay an EB-5 but to get to a point which we can do refinance with a commercial vendor. And we are awaiting some certainty on the EPA, I must say, it is actually the milestone that most commercial banks are looking for whether the law is going to be enforced. It’s very, very difficult for them to make any business decisions when federal law is not being enforced by the EPA.

I understand. Just I read somewhere that the armed forces are supposed to be switching over from conventional fuels to green fuels?

Yes, and you’re correct and Aemetis announced jet fuel purchasing program starting with 40 million gallons this year and rising over the next three years to total 326 million gallons a year. This is over $1 billion a year of purchases by just the Navy. Add to that the air force and add diesel etcetera, they’re driving a 10% jet fuel blend and then on diesel to try to get a power diesel brand that is high as possible. So, there is a very strong support for biofuels in the military and that’s for a variety of reasons actually, including just good old price. We think that we’re experiencing low orders right now but the OPAC Oil Minister said that he probably had $200 a barrel crude oil if you can even start drilling some more when you asked about the declining and drill rigs in the U.S. And it won’t take very long for people to figure out the biofuels is going to need some sugar, a whole lot cheaper than jet diesel or gasoline coming from $200 crude oil. So, we’re definitely in a rising tide, it floats are boats, we’re going to be one the boats that are floating but not just the commodity markets, it’s - we’re also going to be floating because of our technology which allows to use less expensive feed-stocks and some used higher value products such as distilled biodiesel rather than regular biodiesel.

Okay. And lastly, is the quality that’s being produced over in India, is that superior, the same or inferior to what’s being produced here in the States?

This is not us cracking but it’s actually far superior. We meet the European specifications for biodiesel and we have to float it across the ocean for three weeks and still pass the European cold float plug-in point and other tasks. So this is really the world’s highest quality biodiesel we have to produce, and how we do that.

Does it make economic sense to produce it over there and bring it, ship it over here to States?

It does, it’s actually more profitable to do it in India though. Diesel used to have up to 30% subsidy from the government, it’s costing them around $11 billion a year for fuel subsidies. When that subsidy went away, the price of diesel in India rose to the world price. And so it’s actually more profitable now to sell in India rather than we bring it into California and then float it to Europe.

So, I would imagine so, but just in case I was just wondering if there is any differential that you can’t sell which we have over in India, you can bring it over here?

We can actually do that, you are exactly right. It’s just, we’re actually having an opposite problem, which is too many customers, too many opportunities and we’re working hard to ramp up production and the things related to production to meet domestic demand in India.

Okay, well, thank you for your time. I’ll let anybody else ask some questions.

Thanks for your support.

Thank you. Our next question comes from the line of Keith Goodman with Maxim Group. Please proceed with your question.

Hi, guys. I’m glad to hear India looks like it’s becoming a real opportunity. I’m curious, a, whether the margins there and b, could you refresh my memory a little bit, I thought spreads were getting a little bit better in Q1 than they were in Q4? And I know you had, there was a timeframe in Q4 where you had some shipping costs that were negative for the quarter. And if you could kind of walk me through why we’re not making money at $30 million of revenue?

Let’s take the second question first. The corn ethanol and distiller’s grains and to a certain extent corn oil components are the four components that has margin in the U.S. I mean, natural gas, energy input used to be involved, it’s been pretty flat quite frankly, so it’s really not a factor but people pay attention to that now. There were two weaknesses in the first quarter. First weakness was ethanol prices driven by a following crude oil market and sustained non-enforcement of federal biofuels policy by the EPA. So, a very simple thing happened. We went from roughly 15 million barrels of national inventory last year to almost 22 million barrels of national ethanol inventory during the winter, and the first quarter of this year. Obviously with increasing stocks, with inventory the price falls because the customer, the fuel blender has many more choices about who to buy from. So that ethanol margin fall is the primary reduction in our margin during the quarter. Secondary to it was, the web facility trained, grain range market softens in the first quarter. But primarily it’s the ethanol market were to fall of crude oil from the $100 of roughly to $43. As we all know crude oil has been on the care for the last five weeks. And we’re now no longer seeing $43 crude oil, we’re no longer seeing $1.45 ethanol either. So our ethanol is now at a $1.80 plus in California. And so, we’re seeing what you can consider to be a dramatic rise in the price of ethanol just in the last couple months or so. So, the first quarter was a weak quarter because of excess inventory, it should have never occurred. If you look at federal law 14.4 billion gallons last year, 15.0 billion gallons…

Okay. And I would assume, I mean, when you were at $1.45 for ethanol that was in Q1 or that was Q4?

That was Q1.

Okay. All right, thanks a lot.

Thank you, Keith.

Thank you. [Operator Instructions]. Our next question comes from the line of Tom Welch with Ameriprise. Please proceed with your question.

Yes, thank you so much. Wow, lot of questions here from me. First, take a look at the biodiesel business. With waste products being used, obviously the profit margins there, that’s got to be pretty significant. Can you give an idea of what the generally what the gross profit margins are in the biodiesel business for you folks in India?

We really can’t disclose it, but generally, but I would say they’re healthy and certainly not for us to expand the business to 100 million gallon per year on retaining cash flow as we get to the first 50 million gallons running. And that upgrade by the way cost $15 million in 6-12 months.

I’ve seen numbers here in the U.S., preservers that are able to use basically waste products like yellow grease etcetera. It’s not unusual for a plant here in the United States to be running anywhere from 20% to 30% profit margin. Would you say that’s similar in India or?

No, I don’t think we’re making any projections right now. But I view it in the U.S. using waste products, you have a healthy margin.

Yes, okay. What’s the price differential on average between biodiesel and regular diesel in India currently on average?

Yes. In general we’re talking about 5% plus discounts if you looked at profit prices being made in the market, I think 5% is a good number to kind of generalize that.

It seems to me from a purely business standpoint if I’m running a fleet I cannot, one of my principle cost is going to be fuel and if I can mark 5% of the cost of my fuel, it’s certainly, it’s a compelling argument to switch over to distilled biodiesel?

We have a number of customers they’re between 50% and 70% of their cost is actually the cost of diesel. So a 5% discount as you can imagine is very important component of their cost structure.

Exactly. I’m looking here at Q4 in 2014 and Q1 2015, it looks like you guys in Q1 and Q4 were running at less than 5% of capacity on the biodiesel plant in India. It’s amazing to me to be thinking that in by the end of this year you guys are, you’re looking at having a plant up at full capacity, that’s a massive ramp-up?

It might seem to be massive but interestingly enough, from operating the plant we’re operating at 100% capacity. And then we shut it down. And then open it up again and run it 100%. So, what we’re really talking about is just a number of weeks of operation per year, it’s really not our ability to run at 100%, it’s just a supply-demand function in India, in which we really literally had no domestic demand because diesel was being subsidized by a 30% plus government subsidy. But they never extended to biodiesel, they were actually trying to go the other way and reduce subsidies not increased, subsidies when biodiesels became important part of the fuel mix. So, we were basically blocked out of the market in India until that structure change, when it did change and we were allowed to sell directly to both users overnight take large market opportunity opened up. And of course our job then was to educate our customers about the dependability of our supply-chain and the quality of our product and those kinds of things. But we just literally had no market prior to sort of mid-quarter, mid-Q1 of 2015 we literally just didn’t have any market growth.

All right, excellent. Another question, I know that glycerin can be a very profitable business here in the United States, I would imagine that it’s true also in India. Obviously, it depends on the quality of the glycerin produced. There are some plants, biodiesel plants in the United States that are actually making more money on their glycerin from there on their biodiesel. And that’s because they’re putting out a highest possible grade biodiesel typically, I mean, glycerin, typically you can promise physical grade because they are using a distillation process. Do you use your distillation process on your glycerin as well?

We built a refined glycerin plant because of about 10% of what a biodiesel plant produces is glycerin. And we have that certified as pharmaceutical grade glycerin. So, yes, we have highest grade glycerin available. The reason why is it India has over 400 pharmaceutical companies, and they are one of the few countries in the world who is actually short of domestic glycerin. And you may know when you ask for actually the long on throughputs and we actually latch throughputs and because of biodiesel plants. And so, India often imports this product at a high cent. So I agree with you, glycerin is a very high margin business. And we are, already completed there is no further construction on other developments to be done by us to be fully qualified supplier in that market.

And I find the fact that you’re producing pharmaceutical grade glycerin and that your source is strictly animal and/or vegetable.

That actually is the highest tier you can possibly get, you see discussions all the time as far as for example here in the U.S. on E-cigarettes and how they’re taking off like crazy. But the struggle for a lot of these folks and with these progressing and all that is finding a, pharmaceutical grade glycerin, and b, finding pharmaceutical grade glycerin that is specifically from animal or vegetable fat, so you guys are at the top of the top of the top of the tier.

In India, we ran our business plan a few years ago when we said to do that, we filled both with distilled biodiesel and refined glycerin which is either correct is the world’s gold standard for those products.

That’s incredibly impressive. Okay, switching gears, the way it’s much hard to do because I think that we’ve got such a sleeping giant here in the range to the biodiesel, it could be the tail that certainly starts wagging the dog as far as Aemetis goes. But switching gears, last October you were looking at holding hands to the California plant, the ability to produce CO2. At the time you were looking at bringing CEO production online by Q4 of 2015. Does that still look reasonable or is that time to change?

Yes, we’re definitely moving forward with CO2. We’ve had several more opportunities presented to us by very, very large companies that are very interested in our strategic position. And frankly there were very, very attractive opportunities presented to us. And so, we have been extended negotiations with very, very large companies, and expect to come to fruition on a deal probably in Q2. And so we will be asking that as it comes back. We certainly have an alternative of just doing the project ourselves. And there are some downstream products from CO2 that we could produce with CO2 as well. But we have just some very attractive alternatives and so we’re making those decisions this quarter.

Okay, very exciting. The last question that I have, I was surprised reading through the release that you repurchased 1 million shares, essentially at $5.50 a share from one of your creditors. Can you walk us through that decision when that was made? It looks like it’s a premium to what the market value would have been during that first quarter of 2015? And can you also give us an idea of what you paid for the additional 500,000 shares?

We’ve done two repurchase transactions for a total of 1.5 million shares. The second transaction was at $5 a share, which is roughly as of yesterday the market value for the shares. So it’s all second one at market. The first one was almost at market, we did the deal and I think we’re about $5.32 and when all the calculations were all done, I think the deal was roughly $5.50. So, it was $0.15 to $0.18 above market that they were looking back at us in a higher price than sized G&A. I think it would probably been $8 which ensures that discount is fine. So, a very, very short term trading window kind of view, we’d say we’re really just buying shares back in market. A longer view looking back 12 months I’d say, we’re buying our shares back extremely cheaply compared to our 12-month average. And so, the thinking behind the transaction is two things, number one, our senior lender during the course of us getting I think January 2014, we had $73 million of total loans from a senior lender. During the course of that, it ends up only in approximately 18% of the company. And they were interested in reducing their exposure to the equity and the volatility and the price of the equity. But we were interested in shrinking the number of shares outstanding so that has our profits increase and earnings increase, our non-senior lender shareholders benefit from fewer shares outstanding. So I think we had a common interest which was shrinking the number of shares outstanding. And the second point is, that 100% of financing was provided by our senior lender. So, we did not take any of our operating cash flow in order to do these transactions. So we went through really with that opportunity we actually thought it was a very attractive opportunity to increase shareholder value for longer-term shareholders and that’s our goal.

Very good. That’s then the end of my voice. Thank you so much.

Thank you. Appreciate your support.

Thank you. Our next question comes from the line of How [indiscernible] Group. Please proceed with your questions.

Good afternoon, Howard.

I have questions I guess covering ethanol in the jet fuel and I guess that’s all I want to know. Ethanol is one market where we, that is Aemetis has consolidated on destiny. We can’t fix I’m sorry, I really mean India’s biodiesel.

India, yes, right.

Right, I’m sorry, I didn’t mean that one. In India, it’s a question of selling a product and therefore we have control over that to a great degree, but we can’t fix crude price or other variables in ethanol market, we can do the best we can but we don’t control it. Rather than a long descriptive answer, could we be very specific in with numbers as to how many gallons, my understanding of the 812 metric tons that were sold in the first quarter translates to around 200,000 gallons which is an extremely small amount obviously less than 1 million a year in a 50 million gallon plan. Can you identify how much of that was done in March and more importantly what was sold actually in April so we can get a sense of the ramp up that’s actually occurring? And as part of that, you referred to the need the benefit of selling to one of the three national distributors or mixers. Do we need them or can we piece together a good number of direct sales and absorb our 50 million or 100 million capacity, rather than abstractions? I mean, the first on numbers, as I said, we’re really on a path of direct Y or Z and here is what we’ve done in March and here is what we’re doing in April, what we did in April and this is how May looks?

I understand your question and I think we would be reluctant to give you erroneous answers. I think the right way to answer it would be that we continue to provide through press releases and maybe even in other business update call over the course of next month or so. Real data, potentially even some examples of real customers, we have some very large customers that have their own reasons to maybe want to be publicized as being adopters of this technology. And I think we have a burden of having to continue to communicate about what essentially is a very rapid ramp-up in production and in deliveries in India. So, I’d rather, we just continue the communication process can but I take your request, it’s hard which is monthly data about volumes from insides into large customers and their adoption rates would be very, very helpful to you. And I agree with you completely.

And I don’t see why providing that information would put you at any sort of competitive disadvantage, I can understand margins and your desire to not to publicize your margins. But to indicate that March was significant, better than January and February, that April is better than that with some real meat on the bone in terms of numbers would be helpful. I can’t press you any further than that, you can answer or not?

I take your comments, and I think get the feedback. And we appreciate that and we will make every effort to be as transparent as possible, yes, absolutely no problem with that. We also correspond to be completely accurate.

Now, the previous caller made a very valid point about refining glycerin in the marketplace for it. But refined glycerin was sold in average price of 1 ton of a little over $1,000 in fourth quarter 2014, and under $700, $679 to be exact I guess in first quarter 2015. Is this also impacted by the general oil for crude oil or is there another reason why the glycerin market was unusually high in the fourth quarter or unusually low in the first quarter?

It is currently the crude oil market, the price of crude oil in early 2014 was roughly double what it is in the 2015 rates, so it did not decline as rapidly as crude oil did, specifically because of the strength in India, which you don’t see in the metrics under production and price deployment, the last stage of our quarterly announcement. And you don’t see the input costs declining as well. So, though the revenues were lower, the costs were all significantly lower in the first quarter of 2015 relative to 2014.

Going back to the issue of the biodiesel, I’m not going to ask you pretty quick same way. Seriously quite the same answer. But you once again spoke about direct sales to trucking companies, bus companies and the leasing companies. And then you spoke about the one of the three main government distributors. Can we piece together, can we just piece together a sufficient market from bus companies, trucking companies, etcetera, etcetera to satisfy our 50 million or 100 million capacity without getting to that one of the three government entities? And the second part of that is, you also indicated that your target market are those where the fleets in essence comes back to the same facility every day. So there is a round-trip aspect there and they use the same fuel every day on the same location. Is a vehicle adjusted for biodiesel so it cannot alternate between biodiesel and diesel, you have to use one or the other consistently?

The diesel engine does not have to be adjusted to run on 100 biodiesel. So we can fuel at one deep well and for a long-haul truck they can get what you consider to be a lower cost less polluting fill-up at the beginning of a week. And then they go on out for a three-day trip in their second and third days fill-up with dirty diesel, come back in load up with our fuel again. And that can have a very significant impact on fuel cost essentially can impact one third of the total fuel cost for that investment.

You don’t have to concentrate on the round-trip user, we can concentrate on well, they just have lesser savings than fill-out savings?

That’s exactly right. And what we’re seeing as of the let’s call the daily route drivers are companies that frankly can impact a 100% of their fuel costs and the long-haul trucks 25% to 40%. So I wouldn’t say that we’re differentiating and turning down requests from long-haul drivers. But you could imagine the interest among the daily fleet owners either buses or trucks, I think municipal buses for example or private buses, you can have a very significant impact on their business very quickly.

Do these customers have contracts that do not allow them to switch to biodiesel immediately, they can become interest of the path probably three months or six months, is that slowing down?

That is currently not an issue, it may become an issue as we get into larger government NVs or something, but currently that is not an issue. The dealership of these routes on their diesel, and our discounts are largely then there, but just can’t say currently we’re getting. So they’re seeing an economic benefit from doing business with us. So the larger companies do not pay retail for their fuel. But other than that we’re not seeing long-term constraints in, we have one customer that we’ll not name who is actually no longer buying for particular bunkers that they call them, but just think of it as being a tank, they’re no longer buying any petroleum based diesel from their existing supplier at all because we’re the sole supplier into that bunker.

The last question regarding India and then I’ll go to next question. As you ramp up from 1 million to 50 million, perhaps 100 million, does the feed-stock that you’re presenting using available on volume or do you see an increase of feed-stock dramatically increase in the cost of feed-stock?

We are not expecting a dramatic increase in the cost of feed-stock we do expect a need for standard supply chain for feed-stock. So, our feed-stock already is multiple.

To add of course to distribute for trucking?

Potentially, we will also be importing more extensively. And so, we’re expanding our feed-stock chain and in our scale up I expect feed-stock supply-chain your primary constraint on expansion and things related to acquiring feed-stock.

Now you mentioned the EPA, turning to ethanol, you mentioned your EPA, ruling on June 1, but officially ruling, or finally ruling or something of that nature on November 1. Is June 1 the operative date or in November first three operating date when a user blender is going to have a same as June 1?

I think June 1 is the tractable date. Technically November 1 would be when they’re legally obligated. And the way that market will work is that on June 1, the traders that buy biofuels and buy the tracking RINs, renewable identification numbers, the traders on June 1 will know what they’re going to need to have to do starting November 1, and so they will start buying as it’s been the doctor’s law. So, really from fractural point of view June 1 is on the market with this time. I do not expect a whole lot of the EPA, I’m just being frank with you, I did not expect this to be a one-time catch-up with EPA provided the qualities and start to enforcing federal law. What I fully expect is what I think most people expect is a gradual ramping up but with clarity. So this is 2014, 2015 and 2016 mandates. And what the EPA stated, they want to provide the market the clarity all the way through the end of 2016 on what the biofuels industry is going to look like. I think most people recognize that November 2016 is a presidential election. And there that has big impact on why they want to kind of settle down this issue through the end of 2016 with Iowa, Illinois, Ohio, these are the corn producing states, ethanol producing states being key factors in presidential election. So, we’re all standing by, unfortunately we’re the bunch of people watching political campaigns, making decisions that whether we have to enforce federal law or not. It’s not the way the economy or civilization might run, that’s the way this current administration say regulate this industry.

The ethanol industry, resuming those, how much ethanol they shipped in 2014, if the EPA enforced their own regulations they would have required 14 million gallons, I believe that was the number to be shipped. What was the actual number in this none enforcement environment that actually was shipped?

The mandated number was 14.4 billion gallons. We exported approximately 900 million gallons within them. We put in inventory approximately 300 million gallons, we increased our inventory. And we consumed in the U.S. 13.2 billion. And I’m going to put the word about between the high numbers but that’s a pretty good.

So, today as of 14 billion you’re going for?

Yes, we had 13.2 actually consumed in the U.S.

Sorry, okay.

Yes, and then 14.4 was the mandate. Now there is a pile of these papers, these sheets sitting around, it’s about 1.5 billion of these renewal identification numbers. So, if EPA has enforced law, it would be very simple, the industry would just deliver these piece of paper and say, fine, we have these extra piece of paper leftover from previous years. And everybody would be fully compliant with 2014, no problem. And 2015, they’ll just buy some biofuels and they would be compliant with 2015. The reason why this is problematic is that the oil industry is very reluctant to go above 10%. They need 10%. Everyone to run a gasoline business from the U.S. the average octane of gasoline produced by oil refiners in the U.S. is only 84 Octane. So, if your part of run, you got to go to the pump and you see 87 Octane, 89 Octane and 91 Octane. The way that they’re able to get the higher octane is they blend ethanol. And the second way to pay you need the ethanol, is that the ethanol module, the DTOH have oxygen at 35% of the molecule. So the oil industry instead of buying a very expensive oxygen need is able to blend ethanol at 10% and meet the Federal Clean Air Act requirements for clean burning fuel. So, the oil industry has adopted 10%, it’s an intrinsic part of why we have low cost fuel in the U.S. especially compared to Europe. But they’re trying to keep us from going much beyond 10% because now we’re starting to take market share away from crude oil, this has been an issue for 4 or 5 years, but it’s not a new issue. And I’m very comfortable with the idea that we just produced a 113 Octane product versus 84 Octane, 35% oxygen product which is right in the Clean Air Act. And by the way we’re $1 a gallon cheaper than gasoline in many markets. So, we just have a cheaper product that’s higher quality so we’ll let the market figure it out, and the bottom line is that EPA needs to step back in and start enforcing federal law so that the rules of the game can get back to being deployed.

Okay. But my understanding is that you had indicated that we began 2014 with an inventory of 15 billion gallons, there is 1 billion gallons and then we had 22 billion gallons, was the 1 billion in the U.K.?

The national inventory about a year ago was approximately 15 million barrels.

Okay.

Gallons and barrels get swapped back and forth in this industry.

Sorry, barrel is 44, gallons is something.

Yes, exactly it’s actually 42. But you end up with barrels and gallons being swapped back and forth. So we will feel standard is in the gallons calculation, 14.4 billion gallons.

Right. So, when measuring in barrels, translates to 660 million gallons?

Correct.

And then you said they ended at 22 million barrels, which translates to 970,000 gallons something of that nature?

Yes.

And somehow that increase has suppressed the market. I’m a little confused, I understand your concern, I understand your annoyance and anger at the EPA and certainly it feels viable. But we did sell 14.4 billion gallons, and just some of that was exported?

Correct. And the reason why we had margin compression is, your net back in exports where you have to paper trans-loading and shifting and then trans-loading again to the point entry, your net-backs are lower than selling domestically.

I won’t stay with this point further but I just don’t see how a market gets in balance was so affected in the pricing, but I’ll leave it alone, because basically we produced 14, I mean, if the inventory went up by 300 million gallons, so we produced 14.7 billion gallons and you sold 14.4 billion gallons. I’m not sure?

We actually, yes, and 2014, just to kind of wrap up this topic, in 2014 we actually produced about 900 million gallons that were exported, another 300 million gallons went into inventory, so we actually produced about 1.2 billion too many gallons compared to what the EPA actually had us sell in the U.S. And that’s where you get the excess inventory and low margins from. Now, we made $30 million of positive cash flow last year. And I can tell everybody, if the EPA doesn’t do anything, quite frankly our business is going to be fine. It’s going to be unhealthy for the growth of the business because we will be fundamentally constrained by the distributors who are 97% of the gas stations in the United States are branded oil companies. So we will be constrained by inability to distribute our higher octane, higher oxygen lower cost product. And so, we’re seeking an ability to sell our products and that’s what any will feel we will provision into opting 2005 and then expanding in 2007 with you. But we’re very comfortable as a company that even in the current price environment we can decrease the cost of our feed-stock and sell higher value even save ethanol. We have responses for the current market environment, even if the margins were and prices as we’re seeing was in the first quarter, we are doing things in our company that I think will have a dramatic positive effect on profits anyway. It’s, but you got it right, this is completely unnecessary waste of industrial resources because the EPA is not enforcing federal law and we’re looking for them to get back to where.

What has to recur for you to start shipping this fuel?

We already have the technology license. We this year have the customer, the U.S. Navy is now showing us this big vast range, Air Lines are getting in the businesses aggressively. And so, for us, it will be largely just the upgrade of existing plant. Our strategy is not to do Greenfield projects that to upgrade existing facilities that saves us a lot of money on the CapEx side, existing permits, existing personnel, existing…

Is it in our facility or is there another facility?

A facility, we haven’t announced which one we’re doing yet, but a facility. Our biodiesel plant is nice plant.

Is it one of our two facilities or a third facility?

Our biodiesel plant is an ideal footprint for upgrading. So our India plant is a footprint for upgrading. I can tell you at present time, our focus is on expanding our distilled biodiesel business and not focusing on jet fuel and the other current plans.

I’ll ask just one more question, on the acquisition of the 1.5 million shares which was financed by the senior lender, why shouldn’t Third Eye. We’ve had finance that they’re saying 14% to 15%?

Yes, it was. And as we brought in the $17 million of EB-5 funding, we replaced that by the 3% interest of EB-5 money.

Okay. Yes, it’s always seen, just making a comment, you don’t have to answer. Aemetis is always saying to me and I’ve been a shareholder in Aemetis since I don’t know, I guess a month after you went on to the NASDAQ. It seems to be bankable. And I continue to not understand why everything has to go, why you cannot borrow. And you’ve talked about it before and the importance of reducing Third Eye’s debt under $40 million and you then immediately became bankable and the EPA enforcing a regulation also allowing Aemetis to be bankable. But it just always seemed to me that there was almost estrange in your contracts with Third Eye that did not allow you to bring in another borrower, another line.

We completely agree with you by the way. We think Aemetis, ignite us, I’m sorry.

And we think Aemetis is imminently bankable. We do believe the constraints are temporary. And we’re concerned about the EPA. We think that Third Eye Capital would be very excited about being refinanced. And what we’re doing at taking this forward in terms of shrinking our number of shares outstanding that frankly will reward our shareholders with the eventuality of Third Eye capital getting refinanced. And EB-5 money in escrow plus on the way, it’s another $17 million. So it’s just financing that’s just happening slowly we’ll put it that way. EB-5 program is a federal program, it doesn’t happen in one closing. So we are half way through our $36 million refinancing of Third Eye Capital. And so, we can see clearly how we get to a point where Third Eye is probably repaid.

You see a find for the next EB-5 program this year and would it be of the same magnitude as the first one, the $35 million or $36 million?

We do see applying for this year, we do think it would be in the range of that $30 million to $40 million range.

All right, thank you.

Thank you for your questions, appreciate it.

Thank you. Ladies and gentlemen, at this time I would like to turn the floor back to management for closing comments.

Thank you for all the questions asked today. We thank our shareholders, stock analysts and others for joining us today. We look forward to meeting with you and continuing our dialog about growth opportunity for Aemetis.

Thank you for attending today’s Aemetis Business Update Conference Call. Please visit the Investor section of the Aemetis website where we have posted a written version and an audio version of the Aemetis earnings review and business update. Jen?

Thank you. Ladies and gentlemen, this concludes today’s teleconference. You may disconnect your lines at this time. Thank you for your participation.