Out from the Shadows

Biodiesel plants re-emerge from tough economic times
By Bryan Sims | November 21, 2011

The biodiesel industry is prepared to ramp up production volumes to fulfill the 1 billion gallon biomass-based diesel mandate in 2012 prescribed under RFS2, and once-dormant biodiesel plants, or those resuming construction on past projects, will contribute.

The future of the idled Beatrice Biodiesel LLC will be revealed in November as the 50 MMgy facility in Beatrice, Neb., was scheduled for auction Nov. 29, according to Norm Husa, soybean farmer in nearby Barneston and former member of the Nebraska Soybean Board and United Soybean Board. 

The soybean oil-based facility broke ground for construction in 2007 and was scheduled to start up in 2008, but mounting financial pressures and rising soybean oil prices inevitably prompted the plant’s parent companies U.S. Biofuels Inc. and Australian Ethanol Ltd. of Perth, Australia, to suspend construction, which led to the plant filing Chapter 7 bankruptcy in late 2008. The plant has been mothballed ever since.

According to Husa, the plant features a rail loop for inbound and outbound product and a novel process technology developed by Axens North America. One drawback, however, is that the plant is without a co-located soybean crushing operation.

“In my book it was dead to begin with,” Husa tells Biodiesel Magazine. “If you can’t start a biodiesel plant from the very beginning, your chances of being profitable are pretty slim. If somebody were to offer 10 percent on the dollar, it might be sold.”

The plant was about 98 percent complete, Husa says. If a buyer doesn’t purchase the plant to restart, its components may be auctioned piecemeal by prospective purchasers, he says.

Producers’ Choice Soy Energy LLC resumed construction of its 5 MMgy biodiesel plant and co-located soybean crushing facility in Moberly, Mo., partnering with South Roxanna, Ill.-based biodiesel producer Midwest Biofuels Products LLC to help complete the project. The project originally broke ground in 2008, but construction delays coupled with rising feedstock prices caused the company to indefinitely suspend completing the project.

According to PCSE chairman Jim Beckley, plans are to double the installed production capacity from 5 MMgy to 10 MMgy and install frontend technology that’s capable of processing multiple feedstocks. The plant and soybean crush facility are expected to begin production in December, according to Beckley.

“We’re very optimistic that we’re going to meet our goals,” Beckley says. “We’re very fortunate that we had some great financial partners that have helped us develop this model and had patience to help us see this through.”

—Bryan Sims

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