An undisclosed number of ZeaChem Inc. employees have been laid off after the company was unable to secure a bridge loan that was intended to carry it into the next funding round. “As a result of this unforeseen delay, we could not avoid scaling back our operations, which we intend to be a short-term event,” said Carrie Atiyeh, director of public affairs for ZeaChem. “We are having very productive conversations with investors and are quickly making progress in the right direction.”

The company announced in mid-March that it had produced commercial-grade cellulosic ethanol at its 250,000 gallon per year demonstration facility in Boardman, Ore. ZeaChem is also working to build a 25 MMgy woody biomass- and agricultural residue-to-cellulosic ethanol plant adjacent to the demo plant and announced it was selected for a $232.5 million conditional loan guarantee for the project in January 2012. 

Employees were laid off in three locations, including at the demo plant, the company’s headquarters in Lakewood, Colo., and a lab in Menlo Park, Calif. Operations at the demo plant have been temporarily scaled back and the facility is not being sold, the company clarified. In an email statement to Ethanol Producer Magazine, Atiyeh pointed to the company’s recent success in producing cellulosic ethanol, giving credit to ZeaChem’s great employees, and reaffirmed the company’s value as an investment. “Our main concern and top priority is to expedite additional capital investment in order to get our employees back to work, and continue to make progress toward commercialization and profitability,” she said.