If There Was a Time to Build

With agri-giants and small companies alike jumping into the biodiesel game, new and proposed plants were virtually popping out of the woodwork in 2005. At the same time, a handful of existing producers launched expansions.
By Dave Nilles | December 01, 2005
Approaching the tail end of 2005, the pace of biodiesel plant construction is at an all-time high and showing no signs of letting up. Biodiesel is reportedly in tight demand nationwide, and new projects seem to be originating almost weekly. As was the case throughout the year, keeping tabs on the industry's new and proposed plants is a serious challenge-and one that Biodiesel Magazine has eagerly embraced.

In the past 11 months, the industry has been witness to at least a couple of major international ag corporations making strong entrances into the biodiesel industry. Cargill, for example, is building a 37.5 MMgy plant in Iowa Falls, Iowa. Likewise, Archer Daniels Midland Co.-already an investor in a Missouri biodiesel plant-announced plans to build a 50 MMgy plant near its existing canola crushing facility in Velva, N.D.

The flurry of building activity is not limited to new and large players, though. It includes industry pioneers that continue to expand their reach-and their capacities. As featured in Biodiesel Magazine's July issue, Ag Processing Inc. celebrated the 10th anniversary of its biodiesel plant in Sergeant Bluff, Iowa. Originally constructed in 1996, the plant has undergone several expansions, the latest of which is expected to reach 30 MMgy.

Another time-tested plant, Purada Processing LLC's Lakeland, Fla., facility, is also expanding to 30 MMgy. The plant has served as an important component in biodiesel distributor World Energy's production network since 2000. Notably, the rugged multi-feedstock facility has weathered several major hurricanes in the past two years.

The biodiesel industry's mainstays were joined by many new names in 2005. In fact, nearly 30 plants are currently under construction or expanding. One of the companies driving this growth-and building in a big way-is Renewable Energy Group (REG). Featured in the April/May issue of Biodiesel Magazine, REG envisions a 1 billion-gallon-per-year biodiesel market in the United States, and intends to be positioned to capitalize on the industry rapid expansion. Formed in 2002, REG builds turnkey biodiesel plants, the first of which was the 30 MMgy soy-based SoyMor facility near Albert Lea, Minn, that started up in August. Another REG plant, Western Iowa Energy LLC in Wall Lake, Iowa, is quickly moving ahead with construction. The 30 MMgy facility is expected to start up in early 2006.

While the REG-built plant helped kick start the Minnesota B2 biodiesel mandate-the first of its kind in the nation-another Minnesota biodiesel plant was already preparing the state's blenders and distributors for the landmark legislation. Redwood Falls, Minn.-based FUMPA Biofuels, which was featured in the August/September issue of Biodiesel Magazine, has been operating since December 2004.
A third Minnesota plant, Minnesota Soybean Processors (MnSP), a 30 MMgy plant in Brewster, also started up in August.

Canada isn't far behind in the biodiesel construction boom. BIOX Corp. will complete its 16 MMgy plant in Hamilton, Ontario, in January. The new plant not only marks the beginning of the company's commercial operations, but the first step in an ambitious plan to build similar plants across North America and Europe.

Some companies took a somewhat smaller approach to entering the industry. In November, Biodiesel Magazine spoke with Greenline Industries, a company whose mission is to become the world's leading manufacturer of small- to medium-scale biodiesel processors. The company built its first plant in Vallejo, Calif. The company also provided process technology and equipment for Oregon's first biodiesel plant, Seattle BioDiesel LLC. Greenline also built Southern BioDiesel LLC's 2.5 MMgy facility in Jackson, Miss.

Earth Biofuels Inc. expanded its reach in 2005. Despite its name, however, the company is mainly focused on the Southeast region of the United States. Earth Biofuels is currently building a 10 MMgy plant in Durant, Okla., which is expected to be operational by the time this issue hits the streets. The company plans on building a retail distribution network including 170 pumps within the next year.

Several states got their first taste of biodiesel production in 2005. Maine, Oklahoma, Oregon, New Mexico and Ohio all saw facilities start production. Nationwide, well over 100 plants are currently in the production, construction, expansion or proposed stages. And there is no sign of an industry slowdown.

The National Biodiesel Board recently suggested that U.S. biodiesel production in 2005 could reach 75 million gallons-triple the 2004 total. With the amount of capacity that came on line in the past year-and the amount expected to come on line in 2006-that shouldn't come as a surprise.

Dave Nilles is associate editor of Biodiesel Magazine. Reach him at [email protected] or (701) 746-8385.
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