USA. Central Bio-Energy invests $500m to build ethanol plants in Seward, Howard & Chase counties Nebraska

Monday, 20 November 2006

Central Bio-Energy, LLC (CBE), a Nebraska-based firm, has announced that it plans to invest more than $500 million to build three 100 million-gallon-per-year ethanol plants in Seward, Howard and Chase counties in Nebraska. The announcement was made in the Nebraska State Capital Rotunda in Lincoln. These plants will employ 150 full-time staff, with combined annual payroll in excess of $6 million. This investment will make CBE one of the leading ethanol producers in Nebraska, officials said. Projected annual revenues, when all three plants are operational, will approach $600 million.

Gordon Glade, president – Central Bio-Energy, said CBE was proud to bring economic growth and employment opportunities to rural Nebraska. “We are honored to have already received tremendous support from the leaders in each of the counties where we have identified ideal plant sites,” comments Glade. “We look forward to being good corporate citizens in every Nebraska community where CBE operates and to creating exceptional careers.”

Brett Frevert, chief financial officer, said that the average CBE plant job would pay approximately $42,000 per year, for a total payroll in excess of $6 million. “As Nebraskans ourselves, it is especially rewarding to bring jobs of this quality to parts of the state where finding good jobs can be a challenge,” Frevert said. “CBE’s mission is to build modern, long-lived, profitable plants that contribute to the prosperity of many Nebraskans.”

Because CBE will be a large consumer of corn, the three new ethanol plants will also benefit Nebraska farmers. “Each plant will purchase approximately 40 million bushels annually, or 120 million bushels in total,” Frevert said, “providing a tremendous boost to the local corn markets.”

CBE will also sell distillers’ grains, the after-product of its ethanol plants to local cattle feeders as a less expensive, but high-quality, alternative to corn. Frevert adds, “Everyone should benefit – farmers, feeders and local businesses all stand to benefit from having our plants in their communities.”

Gov. Dave Heineman, who spoke at the event, said, “I am pleased to congratulate Central Bio-Energy on this exciting addition to our state’s booming ethanol industry and to the local economies of Seward, Howard and Chase counties. In-state ownership groups like CBE are committed to benefiting every community in which they operate and that makes this announcement good news for everyone involved.”

Dennis Schulz, senior vice president – operations, said CBE has acquired options on tracts of land in Seward, Howard and Chase counties after exhaustive site selection research. Potential sites were identified and rigorously evaluated for transportation, utilities and corn and livestock capacity. In addition, each of the sites was studied to optimize the impact on the other sites. “We also held extensive meetings with the leaders in all three communities,” Schulz said, “to make sure a project like ours would be a welcome addition.”

CBE has signed Plant Development Agreements (PDAs) with Delta-T Corporation, one of the leading ethanol technology firms in the United States. “Delta-T will provide the engineering and technology design for all three plants,” said Danny Petersen, senior vice president - development.

Compared to biorefineries that may look similar, Rob Swain, president of Delta-T Corporation, explains that the Delta-T design runs on much less energy, takes less water, reduces total operating costs significantly and uses a unique water recycling system resulting in zero process wastewater. This process design was developed in 1993 in Delta-T’s first large-scale ethanol plant and is still unmatched today by any other plant designer.

“Central BioEnergy will have the smallest environmental footprint than any plant in operation today,” says Rob Swain.

CBE has also signed contracts with The Boldt Group Inc., of Wisconsin, as general contractor. Boldt is one of the top 75 largest contractors in the United States and is ranked 20th among fuel project contractors.

“Boldt is very enthusiastic about working with Nebraska-based subcontractors for all three plants,” Petersen said. “In addition to creating 150 permanent plant jobs, we estimate that these three plants will also create approximately 150 – 200 construction jobs per site.”

CBE is negotiating with Tenaska BioFuels, LLC, which provides marketing, physical delivery and financial services to customers in the ethanol and biodiesel industries, to provide various consulting, supply and marketing services to CBE for their ethanol facilities.

Dave Neubauer from Tenaska BioFuels said, “We look forward to developing new and productive relationships with alternative fuels producers, marketers, blenders and retailers such as CBE. Particularly we look forward to helping bring exciting and beneficial new energy resources to our nation.”

Construction of the first plant near St. Paul in Howard County is scheduled to begin later this year, Petersen said, and is expected to be completed in the first quarter of 2008. The second plant, scheduled to begin construction in the spring of 2007, will be built near Utica in Seward County and is expected to be operational by the summer of 2008. The third plant, to be built near Imperial in Chase County, will break ground in the spring of 2007 and is expected to be completed in the summer of 2008.

CBE plans to contract with ConAgra Trade Group Inc. for grain procurement, distiller’s grain marketing and commodity risk management services. As the commodity trading arm of packaged foods, ConAgra Foods Inc., ConAgra Trade Group leverages extensive agricultural and energy commodity expertise to provide procurement, logistics and marketing services to the renewable fuels industry.

“Ethanol is a great fuel additive in either E10 or E15. The E85 impact continues to grow as well. Ethanol burns cleaner and is a cost-effective octane booster,” Glade said. “The opportunity for CBE, and really for all Nebraskans, to play a major role in the booming renewable fuels industry should be very exciting to us all.”

Last Updated ( Monday, 20 November 2006 )