Thanks for the analysis, David.
I seem to recall that the company projected being profitable starting with their November '06 10Q filing, but I couldn't find a link that substantiated that. The recent drop in crude prices probably won't help PEIX at all, either.
I don't think production/consumption of E-85 is the only consideration, though. There is also the fact that they need to use ethanol as a summer additive to regular gasoline since Big Oil decided to phase out MBTE. How much this helps the ethanol producers is murky right now (we'll know with their next quarterly statements, I suppose, since the end of summer-additive season was a week or so ago).
As for the cash-burning-- they have built new refineries this year, so that should help them grow sales to (hopefully) keep up with the cap ex.
That said, I have cashed out on most of my PEIX position (sheer luck-- I think I actually sold on the all-time high) and would not consider buying more until they make real profits so I can evaluate them better.

--JGBFool

ps-- I hope that they improve the technology for getting ethanol from sources other than corn, so that I can have more of the drinkable corn ethanol in the form of Gentleman Jack ("...all the folks on Rocky Top get their corn from a jar").