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Future results may differ materially from those projected in these forward-looking statements. You are encouraged to refer to our SEC filings, including our most recent Annual Report on Form 10-K for a full disclosure of these risks and uncertainties.Now, I’ll turn the call over to Gary Roth for opening remarks. Edward Gary Roth Thank you, Karen. I am pleased to report that we achieved record production of 5.4 million gallons of renewable products at our Geismar Plant during the month of July. July figures imply 65 million gallons annual production. The Geismar Plant was designed to produce 75 million gallons per year. We have now produced over 19.3 million gallons of products through the end of July. We continue to expand, stay improved in both reliability and production. In May, June and July our production was 3.1 million, 3.6 million, and 5.4 million gallons respectively. Since we began plant start up and commissioning last October, we have focused our efforts on reaching design capacity. During commissioning, we modified plant equipment to improve reliability, which is reflected in our 87% uptime July numbers. Let us review the performance for the last 10 months. We will focus on three items, feedstock cost, revenues and operating expense. For the prior 10 months, our average feedstock cost have been $3.68 a gallon and our blended revenue was $4.98 per gallon resulting in a gross margin of $1.30. This compares to weighted average soy based bio diesel gross margin of $0.76 per gallon for the same time period. Our average operating expense was $2.96 per gallon, which equates to the net loss of $1.66 per gallon through June. The $2.96 per gallon occurred during our commissioning and start-up period when we averaged 25% of design and capacity. Based on preliminary cost in July, we believe our original operating expense of $0.50 to $0.55 per gallon is attainable. This is especially true given our budget originally included $0.19 per gallon of hydrogen cost. Due to improved plant performance and favorable natural gas costs, we achieved $0.14 per gallon hydrogen cost in July.
In summary, we’ve averaged $1.30 per gallon gross margin and with the project operating expense of $0.55 per gallon; dynamic fuels would have achieved a cash margin of $0.75 per gallon or $56 million a year at design capacity. There remains considerable revenue upside.Our diesel price doing commissioning and start-up averaged $5.55 per gallon. During the same period the average full value of renewable diesel, which is calculated the sum of ULSD diesel price plus RIN plus a dollar subsidy was $6.01 per gallon. As we continue to improve plant reliability, we would expect to close the differential between our current sales price and full value of renewable diesel. During the 10 months of operation, our non-diesel price component of production averaged $1.68 a gallon versus a petroleum equivalent of $2.03. This discount again was primarily due to commissioning volatilities. Finally, we expect to receive 1.5 advanced bio-fuel or D5 RINs per gallon for our renewable naphtha. Advanced bio-fuel RINs has averaged $0.61 per RIN for the first six months of this year and currently trade at $0.84 per gallon. We have applied the EPA for advanced bio-fuel naphtha RINs and expect approval in the fourth quarter. If we had received full market value for our products and naphtha RINs during the prior 10 months, our average revenue per gallon would have been $5.48 versus $4.98 or an improvement of $0.50. The fundamentals of the renewable diesel market remain strong. Renewable Fuel Standard or RFS was created by Congress in 2007 to stimulate the adoption of renewable fuels in the United States. In 2010, EPA adopted the second generation of RFS know as RFS2, which was implemented in July 2010. Since its introduction, RFS2 remains the primary tool to create bio-fuels demand in the U.S. Read the rest of this transcript for free on seekingalpha.com