Waste-to-fuel startup Enerkem withdraws its IPO, too

Waste to fuel startup Enerkem has withdrawn its IPO plans citing — what else — poor market conditions. The move is the third greentech IPO hopeful to cancel public market plans this month, following moves by gas farming startup Luca Technologies, and solar thermal company BrightSource Energy.

As I pointed out when Luca withdrew its IPO filing, the hope that there was a greentech IPO revival brewing is now officially debunked. An investor in BrightSource, DBL Investor’s Nancy Pfund, lamented in an op-ed this week the sad state of a society and marketplace that won’t allow a solar thermal to go public at the valuation it wants, but in the same week can support a large secondary offering from Dunkin’ Donuts.

Solar inverter company Enphase Energy was the only greentech company that had intended to go public in recent weeks, and which actually did. On May 30 the startup sold nearly 9 million shares at $6 a piece, raising about $54 million. The company is currently trading at $6.86 per share, slightly above its debut price.

Enerkem is a Canadian company, founded in 2000, that develops technology that turns waste into biofuel. The company has won federal government backing — a conditional commitment for an $80 million loan guarantee from the USDA — and also counts giant trash hauler Waste Management, oil refiner Valero, Rho Ventures, Braemer Energy Ventures and the Westly Group as investors.

Enerkem gasifies various forms of waste — everything from old telephone poles to mixed municipal garbage — and then turns that syngas into various fuels including methanol and ethanol. Enerkem has inked non-binding agreements with Waste Management and Valero to sell its equipment, and those deals give Enerkem the option to co-own refineries with Waste Management and Valero.

Since 2008, Enerkem has been running a pilot plant in Sherbrooks, Canada, that can process 4.8 metric tons of feedstock a day, and its demonstration plant, in Westbury, Canada, was built to produce 1.3 million gallons of fuels per year. The company is now building a commercial refinery, located in Edmonton, Canada, that will be able to make 10 million gallons per year. It expects to get ready for producing methanol at the Edmonton facility in the first quarter of 2013; ethanol production should follow in the second half of 2013, says the company.