Jackson Jambalaya

Kelley Williams, Sr. writes in Bigger Pie Forum that another state-backed energy project failed:

Kior, a state funded green energy project, recently announced the shutdown of its Columbus Mississippi plant. It was supposed to produce gasoline and diesel from pine trees. This is the sixth state funded technology start up that has failed.....

Kior put a hopeful face on the shutdown announcement. You know: not to worry because the shutdown is just temporary while we raise money to fix what doesn't work. Kind of like the smiley face it put on the $31.3 million loss first quarter 2013 that I wrote about last May. The CEO said then: not to worry because we are making progress and expect things to get better.

However, things got worse, not better. Losses increased and totaled $261 million at the end of Q3 2013 - more than the cost of the plant. That's a lot of money for most people. But it's chump change for Kior's creator, billionaire Silicon Valley venture capitalist Vinod Khosla. He has bankrolled Kior with help from other billionaires including Microsoft founder Bill Gates. And he may continue to do so indefinitely.

So while bankruptcy is probably inevitable, the timing is uncertain. Who knows when he will pull the life support plug? He may be hoping for a federal bailout payoff from Kior's lobbying expenses which have steadily increased along with its losses. Or he may have a state bond bill in mind like Kemper's to force customers to finance Kior's cost.

But insiders are bailing. Former Secretary of State Condoleezza Rice resigned from the board in December. The Chief Financial Officer suddenly quit without the usual "no disagreements with management" statement. An investor filed a class action lawsuit last August alleging misleading reporting. In the last few weeks one of the largest shareholders liquidated his position at prices in the $1.50 range vs the initial public offering price of $15 and high of $23.85. The stock closed recently at $1.11 per share.... Rest of the column