Archive for April 15th, 2008
USDA Corn Stover study
Determine the amount of crop residues (e.g., corn stover, cover crop) that must remain on the land to maintain soil organic carbon (SOC) and sustain production. Through a series of experiments with factors including tillage and residue removal conducted under several environments, measure biomass production, grain yield, and change in soil organic carbon, and from these measurements estimate the amount of residue needed to maintain soil organic carbon and productivity. Click here to read the study which runs through 2011
UT Corn Stover Study
The 1,000 MT/day facilities appear to be
economically feasible if the price of
ethanol at the plant gate equals
$1.25/gallon. Even at $1.15 per gallon
at the plant gate, the 1,000 MT/day facilities
are feasible in some states. If a
subsidy was available to producers using
corn stover to produce ethanol so that
producers were guaranteed $1.35/gallon,
an estimated 136 plants would be constructed,
4,134 million gallons of ethanol
would be produced, $963 million in
gross income to agricultural producers
would occur, and an estimated economic
impact of $11 billion in rural economies
of the ten state region would be realized.
Renewable Energy LLC
Ethanex Energy Inc. said Monday that it has signed a definitive agreement to buy Midwest Renewable Energy LLC‘s ethanol plant in Sutherland, Neb., for $220 million in cash and Ethanex stock.
Ethanex (OTCBB: EHTE), based in Basehor, Kan., said Nov. 28 that it had signed a letter of intent to buy the plant and had put a hold on its efforts to finance the building of plants in Illinois and Northeast Kansas.
In a release Monday, Ethanex said several of its wholly owned subsidiaries will buy substantially all of the plant’s assets and assume certain liabilities in a series of three transactions, the final one of which is expected to close in the first quarter of 2009.
Ethanex COO Bryan Sherbacow said that the company is in a quiet period mandated by the Securities and Exchange Commission and that he can’t comment beyond the release. The company will make an SEC filing by the end of business Wednesday with more details about the proposed transaction, he said.
In Monday’s release, Ethanex said it first will buy the existing plant for $50 million in cash. The plant has a production capacity of 26 million gallons a year (MGY) and is in the midst of a two-phase expansion, each of which will add 42.5 MGY of production capacity, for a total of 111 MGY.
At each of the three closings, Ethanex will receive $2 million of inventory as part of the purchase price.
Ethanex plans to build and add its integrated fractionation platform to the plant, developed with Buhler Inc. The fractionation platform will start operation when Ethanex buys the first expansion phase of the Sutherland plant, estimated to occur in the fourth quarter of 2008.
Ethanex estimated that the fractionation platform will enable total plant capacity to be about 132 MGY when the project is complete. The plant also will produce high-protein distiller’s grains, food-grade crude corn oil and corn gluten feed.
After the first closing, Midwest will be responsible for continuing and completing the two-phase plant expansion. Ethanex will buy each of the two expansion phases for $60 million in cash and $25 million in Ethanex common stock at each of the second and third closings.
Ethanex said its ability to complete the purchase is contingent on it getting bridge financing of at least $1.5 million to keep operating into the second quarter and an unspecified amount of additional financing if the first closing is delayed.
Either company can terminate the agreement if Ethanex can’t get interim financing by March 5.
Ethanex estimated that it will need about $263 million, including a $20 million working capital line, to finance the three transactions.
If Ethanex can’t get sufficient financing for either the second or the third closings, the companies will operate the plant through a joint venture, with Ethanex’s investment discounted by 10 percent for failing to get sufficient financing.
MRE, led by plant CEO Randy Kramer, rebuilt the Sutherland plant and restored operations after the 2003 foreclosure. Within a few months, the plant was producing at the rate of 15 million gallons a year, at or above its projected capacity.
The company also soon paid nearly $400,000 in overdue property taxes to Lincoln County, which the former owners had left unpaid.
The first Sutherland ethanol plant was built in 1990, but a series of owners failed to make it operational, until Midwest Renewable bought the plant and Kramer took over.
One of the owners of the plant in the 1990s, the Delta-T corporation, became a business associate of Ethanex.
Paoli Co-op
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Nebraska Kansas Colorado Railway
Nebraska Kansas Colorado Railway, Inc. (“NKCR”) owns and operates approximately 559 miles of track in three states and carries a diverse mix of wheat, corn, coal, fertilizer.
NKCR has benefited from its ability to attract high throughput grain elevators to its lines due to its superior service record and excellent relationship with BNSF. More specifically, NKCR recently made considerable track improvements in conjunction with upgrade investments by the owners of grain elevators at Venango, Loomis and Maywood, Nebraska, each of which now loads 110-car shuttle trains. In addition to grain, NKCR ships inbound coal to the largest power plant in Nebraska.
Algae and Ethanol
April 14, 2008 (Market Wire) On April 9, 2008, Green Plains Renewable Energy, Inc. (NASDAQ and AMEX: GPRE) received preliminary approval from the Iowa Power Fund for a $2,315,407 grant to fund research and development of algae-based biofuel feedstock production. The award is subject to negotiation and completion of definitive agreements among Green Plains, GreenFuel Technology Corp. and the State of Iowa.
Green Plains’ proposal was submitted in cooperation with GreenFuel Technology Corp., a Massachusetts-based firm with expertise in algae-based biofuels. The grant will allow Green Plains and GreenFuel Technology to conduct a 195-day test to determine the viability of algae production at Green Plains’ ethanol plant site in Shenandoah, Iowa. The project is expected to utilize the plant’s carbon dioxide to produce approximately eight kilograms of algal biomass per day. If the test is successful, the project could be expanded for feasibility and commercialization.
“Algae production compliments ethanol production,” said Wayne Hoovestol, Chief Executive Officer. “The algae project involves recycling heat and water, while mitigating carbon dioxide. Additionally, there is strong evidence to suggest that Iowa has ideal environmental conditions for commercial algae production.”
Algae offers potential as an alternative feedstock for biodiesel. According to GreenFuel Technology, oil yields from algae are estimated at several thousand gallons per acre, while oil yields from soybeans are approximately 65 gallons per acre. No genetically-modified organisms are involved in the proposed production process. By-products include feed ingredients and biomass for energy generation.
“GreenFuel Technology has run several projects at major power plants in the United States,” said Cary Bullock, Vice-President of Business Development for GreenFuel Technology. “However, we are especially excited about the Green Plains project because of the natural synergies between the algae and ethanol industries. The Green Plains project provides an opportunity to use an operational ethanol plant to further the body of knowledge of algae-based biofuels.”
“Green Plains thanks the Iowa Power Fund and Office of Energy Independence for their support,” said Hoovestol. “We thank Governor Chet Culver for his visionary leadership in promoting biofuels. And, we thank the community of Shenandoah, Iowa, for its tireless support of Green Plains.”
About Green Plains Renewable Energy, Inc.
Ethanol is a high-octane fuel that is blended with gasoline to provide superior engine performance as well as help to reduce harmful tailpipe and greenhouse gas emissions that contribute to global warming. Ethanol has also become a prime source of value-added income for American farmers.
Green Plains, based in Omaha, Nebraska, has the strategy of becoming a vertically-integrated, low-cost ethanol producer. Green Plains operates a 50 million gallon corn ethanol plant in Shenandoah, Iowa. A second 50 million gallon corn ethanol plant is under construction in Superior, Iowa. The Superior plant is scheduled to begin production later this spring. Green Plains has grain storage capacity of approximately 19 million bushels and provides complementary agronomy, seed, feed, fertilizer and petroleum services at various sites in the Corn Belt.
About GreenFuel Technology Corp.
Headquartered in Cambridge, Massachusetts, GreenFuel Technology Corp. is a privately-held venture-backed firm. Founded in 2001, GreenFuel recycles carbon dioxide from flue gases to produce biofuels and feed. Harvesting algae for biofuels enhances domestic fuel production while mitigating carbon dioxide.
Company Contact:
Scott B. Poor, Corporate Counsel / Director of Investor Relations
Green Plains Renewable Energy, Inc.
(402) 884-8700
Investor Contact:
John Baldissera
BPC Financial Marketing
(800) 368-1217
ZeaChem
However now a new energy startup called ZeaChem claims to have solved the problem, and that they can now make ethanol at a competitive price.
At its laboratory in Menlo Park, CA, ZeaChem says they have created a new means of developing ethanol from wood chips, switch grass, and several other sources that is more efficient than competing methods. Developed by experts from the Coors brewery, crude oil refining, and other chemical industries, the process involves joining biomass in a fermenter with a naturally occurring microorganism (found in sources such as termites or horse manure) that unlike other methods uses all fractions of the plant, meaning the energy of all fractions of the biomass end up in the product.
According to the company, their process will theoretically produce a maximum 160 gallons of ethanol for every ton of biomass, and a biomass farm with an eight-mile radius could support a refinery producing approximately 300 million gallons of the fuel per year. In addition, ZeaChem says their method is more efficient than others, citing a “net energy ratio” of between 10 and 12, meaning that for every unit of fossil energy used, 10 – 12 units of renewable energy are produced. In contrast, the company claims corn-based ethanol has an approximate net energy ratio of only 1.6.
So what exactly does all this mean for drivers? Well, according to ZeaChem CEO James Imber, the company will be able to produce ethanol at 80 cents per gallon at the plant, which he estimates would equal a price of about $1.50 at the pump. Of course if you were buying E85, the 15 percent gasoline would add additional cost, plus the lower fuel economy would still be a factor. But that price could certainly go a long way toward turning ethanol into a truly viable alternative fuel.
