Stuart Rose: And to be honest, that’s been less expensive than some of the transactions that have taken place when lesser plants have changed hands.
Pavel Molchanov: Okay. So, earlier this year, the first ethanol to — or, I guess, alcohol to jet facility in the world opened up in Georgia, of course, this is the LanzaJet project. I’m curious if at any of your existing ethanol sites or potentially at some future M&A opportunity, you would be interested in running this kind of conversion project to produce SAF.
Zafar Rizvi: Yeah, Pavel, I was at the SAF Conference earlier this week, actually last Thursday and Friday, hearing about some of the dynamics and projection for this market. Approximately, there was expected to be approximately 30 billion gallons market is there. One thing is very consistent, there is no different kind of aviation fuel. Aviation fuel is only one kind of aviation fuel, which everyone use that. And there is approximately 7 million barrels a day demand. There was American Airline, United Airline, and Southwest Airline was also there. So, we are currently looking into how REX could participate and what may make the most sense on this part. However, right now we really are focused on our, first, getting the One Earth plant up and running, which means permitted, build and in operation.
We are looking at option for CCS behind sequestration of our own carbon, but are concentrating on making our first ethanol plant successful, and first, and most importantly, CCS project successful at this time. But there is great market — in the future that will be the right things to do to maybe even pivot in — maybe two or three or four years from now. But at this time, there is only — when I learn from that SAF Conference, there’s only 50 million gallons are produced and there is not enough market, but it’s expected to grow by 2032, approximately 30 billion gallons. So yes, there is a great future, but at this time, there isn’t really enough market demand there.
Pavel Molchanov: Al right. Appreciate the…
Stuart Rose: One of the keys to our success, Pavel, is not to be the pioneer, but to have the best technology and wait for the best technology and see who has the best technology out there. So, we’re not jumping into it. We’ll — let someone else be the pioneer and take the arrows, but we’ll come in as soon as someone shows that this is — or we’ll at least look at it very seriously as soon as someone shows that this can be a profitable business.
Pavel Molchanov: Thanks very much.
Stuart Rose: Any other questions?
Operator: Thank you. Our next question comes from the line of BJ Cook with Singular Research. Please proceed with your question.
BJ Cook: Hey, guys, thanks for taking my call. Just quick, is there — you guys have any new info or update on the capacity expansion in Gibson City?
Zafar Rizvi: I’m sorry, I didn’t hear your question. Could you repeat that again, please?
BJ Cook: Yeah, sorry. Is there any new information or update on the capacity expansion at Gibson City?
Zafar Rizvi: I think, as I mentioned previously, that we are expanding that plant. The ethanol facility is going to be a 200 million gallon, and construction is in progress. And for the ethanol facility, we expect that will be completed before the end of this year. And then, CCS project is also — the construction of the building is — compression facility building is almost complete, equipment is arriving every single day, and we expect that by the end of July or early August CCS facility will be completed. But we still have to wait for the pipeline permit and the EPA Class VI permit before we start any kind of carbon sequestration. So, those are the main things we are waiting for the permits. But as far as concerned about the facility, it’s going very well.
Doug Bruggeman: This is Doug. Let me add. When we expand that facility, the construction will be to take us to 200 million gallons. The initial plans are to run at 175 million gallons. And once we achieve that and get EPA further approval, then we can go to 200 million gallons.
BJ Cook: Fantastic. Thanks. How are you guys looking at capacity utilization? It’s kind of a moving target, I get it, but for the remainder of year, you guys expect to run it up?
Stuart Rose: The question was capacity utilization. We were assuming that we get a decent corn crop. We plan on running pretty much full capacity. The only time we’ve ever cut back — there’ll be times when we cut back for maintenance. There’ll be times when we cut back just because we’re doing with the CCS where we can’t quite run as much as we usually do, but basically, we’ll be full capacity. We’ll go all out and we always go all out when it’s a profitable market.
Zafar Rizvi: Yeah. We have not really a slowdown. Our slowdown is processes, sometimes it’s maintenance, unexpected some kind of shutdown. So, we try to use the full capacity practically possible because we are in — basically in Illinois in a corn belt area, and South Dakota crops was great last year and expected to be this year same. So, we have no plan to really slow down at this stage.
BJ Cook: Okay. Thank you very much.
Stuart Rose: Thank you.
Operator: We have reached the end of the question-and-answer session, I’ll now turn the call back over to Stuart Rose for closing remarks.
Stuart Rose: Okay. I’d like to thank everyone for listening. As you have heard, we have great plants, terrific plants, great growth prospects, and the key to everything is the execution of our employees. We feel we have the best employees in the industry, the best people working for us. We think that’s what really makes a difference between REX and everyone else in our industry. And we just want to thank them and we also want to thank you for listening to the call. We appreciate it very much. Talk to you next quarter. Bye.
Operator: And this concludes today’s conference, and you may disconnect your lines at this time. Thank you for your participation.
