peix

Pacific Ethanol Inc (PEIX)

Pacific Ethanol Inc (PEIX): last weeks news that production could pick up significantly has sent the price of PEIX shares from .585/shr to 1.01/shr as the volume went from the ave 519k/day to 13.6m today 

Pacific Ethanol Inc. could resume ethanol production at its 60 million-gallon-a-year facility in Burley, Idaho.

Sacramento-based Pacific Ethanol (Nasdaq: PEIX) suspended production of ethanol at the plant in February because of unfavorable market conditions for producing ethanol. Now, the company could begin production as early as January.

The company put much of its operation into bankruptcy protection in May. This year, the company halted three of its four production plants — in Burley, Idaho; Madera and Stockton. Only a plant in Boardman, Ore., is still operating.

Pacific Ethanol also owns 42 percent of Front Range Energy LLC, a plant in Windsor, Colo.

The plants combined have an operating capacity of 220 million gallons a year.

The company could restart the plant because of the expected increased demand for ethanol production in California, from about 950 million gallons this year to about 1.6 billion gallons in 2010. Gasoline sold in California is blended with almost 6 percent ethanol, and that will increase to 10 percent next year.

However, a restart of production at the Burley plant in January depends on a number of factors, including approval by the bankruptcy court, rehiring and training staff, and restocking corn and other raw materials. Pacific Ethanol’s ethanol-producing divisions filed for bankruptcy protection, but not the parent — and publicly traded — company.

The bankruptcy court is set to consider the matter Dec. 14.

Pacific Ethanol produced 40 million gallons of ethanol last year in California, before the plants were idled, according to the California Energy Commission.