On December 30, 2014 Conestoga Energy Holdings, LLC, has requested an immediate suspension of the Trading Service. Until further notice no offers to buy or sell will be accepted.
Conestoga Energy Holdings, LLC (Conestoga) is an ethanol production and management company headquartered in Liberal, Kansas. Though it subsidiaries, it owns two plants in Kansas with combined annual production capacity of 165 million gallons of ethanol per year and manages three plants in Kansas and Texas with annual production capacity of 205 million gallons.
Conestoga’s Arkalon Ethanol plant, east of Liberal, Kansas, produces 110 million gallons of ethanol per year and is licensed to produce undenatured (pure—or 200 proof) ethanol for export to Europe. The Arkalon plant is located on a mainline of the Union Pacific Railroad and is capable of high-speed unloading of unit trains of grain (110 cars) and of loading unit trains of ethanol (95 cars). Each year, the plant also produces over 320,000 dry tons of high-quality distillers grains—a product of the distillation of corn or milo—for sale and distribution to feedyards throughout the central and southern High Plains. In addition, the plant produces approximately 290,000 tons of carbon dioxide per year and sells it to a subsidiary of an independent domestic oil company with expertise in enhanced oil recovery. The purchaser of the plant’s carbon dioxide then pipes the gas to oilfields in the Oklahoma and Texas Panhandles, where it is injected to increase production.
The Bonanza plant, in Garden City, Kansas, produces 55 million gallons of ethanol per year. The plant is located on the Burlington Northern & Santa Fe Railway and is capable of high-speed unloading of unit trains of grain and of loading unit trains of ethanol. The Bonanza plant annually produces over 160,000 dry tons of high-quality distillers grains for sale and distribution to feedyards throughout the central High Plains. It also produces approximately 145,000 tons of carbon dioxide per year and sells it to a subsidiary of an international oil company which pipes the CO2 to oilfields located in southwest Kansas, where it is injected to boost production.
Conestoga’s wholly owned subsidiary, Conestoga Energy Partners, LLC, provides operational and management services for both the Arkalon plant and the Bonanza plant, as well as for the 40 million gallon per year ethanol production plant owned by Diamond Ethanol, LLC, in Levelland, Texas. The Levelland plant produces over 100,000 dry tons of high-quality distillers grains for sale and distribution to feedyards throughout the southern High Plains. The plant, which is approximately 25 miles west of Lubbock, is located on the West Texas& Lubbock Railway.
Another subsidiary, Conestoga Logistics, LLC, provides transportation and logistics services for the Garden City, Liberal, and Levelland plants and attempts to lower effective operating costs at the plants by actively seeking backhaul freight opportunities.
Conestoga is organized as a Kansas limited liability company with approximately 460 members. The capital units of Conestoga are divided into Classes A, B, and C. Holders of Class C units are allowed to participate in all member activities and to vote in all matters requiring member consent. Holders of Class B units have all of the rights of the holders of Class C units except for the power to nominate statutory managers (called “directors” in Conestoga’s Operating Agreement) or to propose amendments to the Operating Agreement. Holders of Class A units possess only voting rights: the right to vote for directors, to approve a merger or sale of all or substantially all of Conestoga’s assets, to remove an elected director, and to approve activities presently prohibited by the Operating Agreement.
