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Alternative Energy - Tuesday, October 27, 2009

Tenneco Receives $24M Loan From DOE

To aid the company’s efforts to develop fuel efficient emission
control components for advanced technology vehicles, the Department of
Energy (DOE) and entered into a $24 million conditional loan agreement
with Tenneco Inc (TEN:NYSE). The emission control manufacturer is the
fifth company to receive money from the DOE’s Advanced Technology
Vehicle Manufacturing Program (ATVM) but the first one not to sell
automobiles.

The previous vehicle manufacturer recipients, whose loans dwarfed
Tenneco’s, were Fisker ($128.7 million), Ford (F:NYSE)($5.9 billion),
Nissan ($1.6 billion), and Tesla ($455 million).

The ATVM program is helping the development of fuel-efficient,
advanced technology vehicles, one of the many pressing priorities for
President Obama. Through the use of government loans, President Obama
is assisting the auto industry to help meet, and even succeed, his
demanding new fuel economy standards while making American cars more
competitive.

Tenneco plans on using the loan to develop and produce emission
control components for gas, hybrid, and diesel-powered vehicle
engines. More than two million automobiles and light trucks built in
2010 to 2014 will be equipped with the emissions control being
developed. Tenneco’s diesel oxidation catalysts are said to reduce up
to 90 percent of hydrocarbon and carbon monoxide emissions.

“Not only are these loans ensuring American workers can produce the
best, most fuel efficient cars in the world, but they’re also helping
to reduce our dangerous dependence on foreign oil and our carbon
footprint,” said Secretary Chu in a prepared statement.

The timing of the loan couldn’t be better as Tenneco was facing
tenuous times back in March with the share price sitting below $1.
Tenneco also received notice from the NYSE that its average market
capitalization had been below $75 million over a 30-day trading
period. But since that time, the stock is up 818 percent with the
company announcing licensing agreements and a joint production
facility in China. Tenneco is also aggressively managing its costs by
recently closing a ride control plant in Cozad, Nebraska.