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Zeachem President Expects Progress
ZeaChem Inc. President and CEO Jim Imbler said in early May the closely held producer of wood-based ethanol and chemicals was having productive conversations with investors as it ovecomes a “short-term” setback. ZeaChem reported in April having to scale back plant operations in Boardman, Ore. and let go a number of employees because the company was not able to secure a bridge-loan intended to carry ZeaChem into its 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,” Imbler said. “After recent successful production of cellulosic ethanol—an achievement for which our great employees are to thank—there is no question as to ZeaChem’s value as a refiner and an investment. To that end, 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.”
Shortly before this development, ZeaChem announced in March that it had produced commercial-grade cellulosic chemicals and ethanol at its 250,000 gallons per year (GPY) biorefinery in Boardman. Among the first operational cellulosic biorefineries in the world, this demonstration facility is meant to showcase the scalability of ZeaChem’s biorefining process and serve as a key stepping-stone toward large-scale commercial production.
Similar to a petrochemical refinery that makes multiple fuels and chemicals, ZeaChem’s demonstration facility employs a C2 (two-carbon atom) platform to produce cellulose-based ethanol and intermediate chemicals such as acetic acid and ethyl acetate. Through relatively simple processing adjustments, according to the company, the ZeaChem platform technology can create C3 chemicals (three-carbon structure) including propionic acid, ethyl propionate, propanol and propylene. Together, ZeaChem’s C2 and C3 products address a collection of end markets of more $1 trillion, the company states.
ZeaChem can convert nearly any non-food biomass into fuels and chemicals. The demonstration facility is to receive its feedstock from nearby GreenWood Resources’ tree farms and other local agricultural residue processors.
Development of ZeaChem’s first commercial biorefinery was getting under way. Backed by a conditional loan guarantee from the U.S. Department of Agriculture (USDA), the facility will have capacity to produce 25 million GPY or more of ethanol and chemicals. It will be located at the Port of Morrow in Boardman, adjacent the demonstration biorefinery. ZeaChem had formed strategic partnerships with Valero and Chrysler.
ZeaChem is headquartered in Lakewood, Colo., and operates a research and development laboratory facility in Menlo Park, Calif., in addition to the biorefinery in Boardman.
Wood Fiber Study Aims For Investment
Minnesota Power, a division of ALLETE, Inc., and its regional economic development partners including the Area Partnership for Economic Expansion, Great River Energy, and the Iron Range Resources and Rehabilitation Board, have commissioned a study of northeastern Minnesota’s and northwestern Wisconsin’s available forest resources. TSS Consultants, a California-based natural resources consultant firm, is analyzing the wood fiber supply in three target market areas near Duluth, Grand Rapids and Hoyt Lakes in Minnesota.
“Our analysis will review forest resource availability and cost estimates for harvest, collection and transportation,” says Tad Mason, CEO for TSS. “In addition to updating the resource inventory, we will also be advising area economic developers of existing commercial technologies as well as emerging technologies that have value-added processing or manufacturing capable of utilizing northern Minnesota’s forest-sourced feedstocks.”
Recent plant closures such as three regional Ainsworth OSB plants and the Duluth Georgia-Pacific hardboard plant have caused significant job loss and have substantially increased wood availability.
“The regional wood basket is attracting a lot of interest from industrial biochemical manufacturers,” says Nancy Norr, director of regional development for Minnesota Power.
“The study results will be used to advance discussions with prospective emerging technology companies as well as inform existing firms considering expansion opportunities.”
Norr says the region’s forest landscape is productive, supports a variety of commercial tree species and the transportation infrastructure and highly-skilled labor force can support expanding the utilization of saw timber, pulpwood, and biomass.
The three-month study is expected to be completed in mid-June.
Energy Dept. Makes Funding Available
The Energy Dept. announced funding access for two pilot-scale biorefineries that will process woody biomass.
Mercurius Biorefining, Inc. is eligible to receive $4.6 million for its project its project in Ferndale, Wash., which will build and operate a pilot plant that uses an innovative process that converts the cellulosic biomass into non-sugar intermediates, which are further processed into drop-in bio-jet fuel and chemicals. Several organizations are participating in this consortium led by Mercurius Biorefining, including Purdue University, Pacific Northwest National Laboratory, and Incitor.
Frontline Bioenergy LLC can receive up to $4.2 million for a project in Ames, Iowa. Frontline BioEnergy, along with its project partners SGC Energia, Stanley Consultants, and Delphi Engineering and Construction LLC, will build and integrate an innovative new pilot scale TarFreeGas reactor and new gas conditioning processes with an existing Fischer Tropsch (FT) unit capable of producing 1 barrel per day of FT liquids from woody biomass, municipal solid waste and refuse derived fuel at the Iowa Energy Center’s Biomass Energy Conversion Facility in Nevada, Iowa. These liquids will be upgraded to produce samples of biofuels that meet military specifications.
Biography Published On Norval Morey
“My Way: The Norval Morey Story” is the title of a new, 224-page hardback biography published by The Donnell Group about the founder of Morbark, Inc. in Winn, Mich. Morey is considered by many as the “father” of wood energy development.
Morey, who died in 1997 at age 77, started up Morey Brothers Sawmill with his brother Burnell in 1947, and 10 years later they introduced the portable log peeler as the initial product launch for Morbark Portable Debarker Company.
The new venture plans to build new decentralized plants in Northern Italian municipalities. The electricity will be fed into the public grid, and the heat energy sold to regional buyers. The feed-in tariffs for green electricity from CHP plants in Italy are particularly economic. Potential customers for the heat energy produced from the wood pellets will include municipal heating networks, schools, retirement homes, supermarkets, hospitals and swimming pools.
Morey and Morbark Industries later introduced its in-woods whole tree chipper, called the Total Chiparvestor, which took the industry by storm.
Morey, who was called Nub, grew up in a log cabin during the Great Depression, and didn’t finish the sixth grade as he helped his family farm potatoes and deliver firewood. He worked at various jobs cutting down trees for landowners and rights-of-way before he and his brother Burnell traveled to the Northwest and worked out of logging camps felling the giant forests for Potlatch, Weyerhaeuser and McCloud River Lumber. Morey then entered the Army and World War II, during which he experienced hellacious front-line combat along the entire Italian peninsula.
Morey received nearly 20 patents for his wood reduction machines and technologies at Morbark, while expanding the Morbark plant to 1.6 million square feet and employing hundreds. He was known for his unique, unbending entrepreneurial style.
Morey became a leading advocate of modern techniques in forestland management, including the processing of forest waste into chips for conversion to heat energy and electricity. Shortly before Ronald Reagan became president, Reagan featured Morey and Morbark’s wood energy movement on Reagan’s radio broadcasts to millions of listeners nationwide. Morey also spoke before the Harvard Business School about decentralized biomass power-based electrical distribution.
Morey’s son, Lon, serves as Chairman and CEO of Morbark, Inc.
The book is written by Rich Donnell and May Lamar. Donnell is the editor-in-chief of Wood Bioenergy and other magazines published by Hatton-Brown Publishers, Inc. Lamar is a frequent contributor to those magazines
To purchase the book, go to amazon.com and then search for Norval Morey. It can also be purchased at Morbark, Inc. by calling 800-831-0042
Drax Signs Agreement With Plum Creek
Plum Creek Timber finalized a long-term fiber supply agreement with Drax, a leading power company in the United Kingdom that is transforming itself into a predominantly biomass-fueled power generator and is building two wood pellet plants in the Southeast U.S. at Gloster, Miss. and Morehouse Parish, La. Plum Creek will deliver up to 770,000 tons annually of sustainably-managed wood fiber to the two pellet manufacturing locations during the course of the 10-year contract.
Drax will export the pellets to its power station in the United Kingdom. Deliveries are scheduled to begin in 2014.
“This agreement further diversifies our customer base and represents a new and expanding market for our sustainably grown wood fiber,” says Rick Holley, president and CEO of Plum Creek.
Plum Creek is one of the largest landowners in the nation with approximately 6.4 million acres of timberlands in major timber producing regions of the U.S. and wood products manufacturing facilities in the Northwest.
2012 Exports Reach 3.2 Million Tons
Exports of wood pellets from North America to Europe reached a new record of 3.2 million tons in 2012, with U.S. exporters more than doubling their shipments, according to the North American Wood Fiber Review.
Demand for wood pellets in Europe has gone up dramatically the past few years as power companies on the continent have switched from using fossil fuels to renewable energy alternatives. Importation of pellets from North America increased more than 60% from 2011 to 2012. The export value has increased from an estimated $40 million in 2004 to almost $400 million in 2012.
With limited domestic wood raw material sources, countries such as the UK, Belgium and the Netherlands have increasingly relied on the importation of industrial wood pellets to reduce the usage of coal at some of their power utilities. The relatively high costs for wood pellets in Europe have resulted in increased interest in importing pellets from British Columbia and the Southern states of the U.S. where wood raw material costs are lower than in Europe. Visit woodprices.com.
KiOR Addresses Feedstock Policies
KiOR, Inc., which reported in March the initial shipments of cellulosic diesel from its first commercial-scale facility in Columbus, Miss., addressed some confusion with regard to its feedstock sourcing policies.
KiOR explains that its sole requirement for its feedstock is that it qualifies as an approved feedstock for the production of cellulosic gasoline and diesel under the rules of the Renewable Fuels Standard (RFS2) as set forth by the U.S. Environmental Protection Agency.
“KiOR can purchase feedstock from landowners and suppliers that satisfy the requirements of RFS2 without a specific certification from a third-party,” the company states. While a third-party certification can help satisfy one of the requirements for one of the categories of feedstock that KiOR can use, a potential supplier of feedstock to KiOR can satisfy this one requirement in six other ways. In addition, if a potential supplier of feedstock prefers to use a third-party certification to satisfy this one requirement, the rules do not specify or endorse any one third-party as a “preferred” third-party certification organization. “What matters to KiOR is that all feedstock to its facilities meeting the requirements of RFS2 – nothing more, nothing less,” the company added.
KiOR believes that the RFS2 rules and regulations provide a level playing field for all landowners and potential suppliers of feedstock. “We look forward to working with landowners and suppliers alike to supporting local jobs in the areas surrounding our facilities by developing a supply chain of RFS2 feedstock that can be made into clean, drop-in cellulosic gasoline and diesel that can help fuel our nation for years to come.”
KiOR’s facility uses pine wood chips previously feeding a shut down paper mill at Columbus and produces gasoline and diesel, the first renewable hydrocarbon fuels in the U.S. manufactured at commercial scale and derived solely from non-food feedstocks to avoid competition with human food needs, the company promotes, adding that KiOR’s renewable gasoline is also the first renewable cellulosic gasoline ever registered by the EPA for sale in the U.S.
Fred Cannon, KiOR’s president and CEO, comments, “With first production at Columbus, KiOR has technology with the potential to resurrect each and every shut down paper mill in the country and to replace imported oil on a cost effective basis while creating American jobs.”
Condoleezza Rice, former U.S. Secretary of State and a current member of KiOR’s Board of Directors, adds, “KiOR is changing the American energy equation by innovating and commercializing an entirely new generation of hydrocarbon-based diesel and gasoline fuel. By making the promise of cellulosic fuels a reality, KiOR demonstrates that these fuels are an attractive option for lessening America’s dependence on foreign sources of energy.”
Forest Industry Wins Water Runoff Case
The Supreme Court recently ruled that logging roads are not subject to stringent industrial rules regarding stormwater runoff. The ruling in Decker v. Northwest Environmental Defense Center reverses a Ninth Circuit Court of Appeals decision that would have required Clean Water Act permits for stormwater that runs off logging roads.
According to Oregon Forest Industries Council, the rules would have required enormous compliance and permitting costs while opening the door for administrative challenges and litigation following every permit approval.
The Portland-based Northwest Environmental Defense Council had raised the issue in 2006 after arguing that such runoff posed threats to fish and other wildlife
Essentially, the Supreme Court validated a recent Environmental Protection Agency interpretation of the runoff regulations. The EPA last year deemed that the stormwater permit regulation should extend only to traditional industrial buildings.
In 2006, the Northwest Environmental Defense Center sued certain timber-industry related defendants claiming that their logging activities resulted in the discharge of pollutants without a permit into streams in state forests in Oregon where they were harvesting timber. In 2010, the Ninth Circuit overturned an Oregon federal district court’s grant of a motion to dismiss the case, finding that ditches and culverts adjacent logging roads were point sources which required federal National Pollutant Discharge Elimination System (NPDES) permits.
The defendants in the case, who operated various logging roads, contended that the state’s Silvicultural Rule foreclosed the need for them to secure NPDES permits, and that potential impacts to water quality posed by the roads could be managed by state-level best management practices. Defendants also contended that, even without the Silvicultural Rule, their activities were not “industrial activities” requiring NPDES permits under USEPA’s Industrial Stormwater Rule.
The Supreme Court decision was a 7-1 vote, and written by Justice Kennedy.
Funding Addressed For Jackson Plant
The Industrial Development Board of the City of Jackson, Ala. has authorized the issuance of up to $150 million in industrial revenue bonds to be utilized in the financing of a new wood pellet plant that International BioMass Energy proposes to build in Jackson.
IBE, led by founder and managing member Tom Bolton, whose background is in construction and development, was formed to pursue alternative energy opportunities in the U.S.
The proposed investment will exceed $100 million, process 500,000+ metric tons of wood pellets per year and employ 75-100. Jackson Mayor Richard Long expects construction to begin during the fourth quarter of this year.
The city was the proposed site of a wood pellet plant several years ago, but that project never transpired, though the city reportedly spent a half million dollars on site preparation.
Florida PSC Approves EcoGen Contracts
The Florida Public Service Commission (PSC) approved Florida Power & Light Company’s (FPL) contracts with U.S. EcoGen, LLC (US EcoGen) to purchase renewable power. U.S. EcoGen plans to construct three biomass facilities in Okeechobee, Clay, and Martin counties, with service expected to begin in 2019.
“These biomass contracts will create jobs for Floridians, help FPL diversify its fuel supply, and save customers money,” says PSC Chairman Ronald Brisé. “System reliability will also be enhanced, and the contracts help defer the need to construct additional plants generated by fossil fuels.”
According to PSC analyses, the three plants are projected to produce a total of 180 MW—enough electricity to power 30,000 to 50,000 homes—and will save FPL customers an estimated $90 million over the life of the plants. More than 140 direct and indirect jobs will be needed to operate each facility during the 30-year contract terms. Eucalyptus will be the dedicated energy crop for the US EcoGen biomass systems.
Canadian Firm Thinking Pellets
Biomass Secure Power Inc. has set up a wholly owned subsidiary Biomass Power Louisiana L.L.C., to build and manage a wood pellet plant at the Port of Greater Baton Rouge. Construction is expected to commence this summer.
Phase one consists of three production lines each capable of producing 340,000 tonnes per year of pellets. Construction cost for phase 1 is estimated at $123 million. When phase 1 is complete the company will have the capacity to produce 1 million tonnes of pellets annually, according to company principal Jim Carroll
Biomass Secure Power Inc. was incorporated in 2002 in British Columbia. In 2005 Biomass Secure Power began looking at the idea of construction and operation of small power generation facilities to take advantage of the BC Hydro Standing Offer Program for the purchase of green power. After numerous attempts, the company was not been able to secure a suitable site and long-term material supply agreements in British Columbia.
In 2012 the company was approached by Louisiana Economic Development (LED) to determine if Biomass Secure Power had an interest in building a pellet plant in the state. According to the company, LED presented it with a package that includes $26.3 million of estimated benefits.
Energy Firm Proposes Pellet Mill For Lucedale
Gulf Coast Renewable Energy will locate a $25 million wood pellet plant in the industrial park in George County, Lucedale, Miss.
The plant is expected to produce 160,000 metric tons of pellets annually, with plans to double production within the next three years.
Company officials met with the local Board of Supervisors to request help with construction of an access road to the site on 40 acres just outside the Lucedale city limits.
The project will create 30 jobs, said company vice president for engineering Gary Ogle.
Wood pellets will be shipped overseas to European utilities to use as biomass energy that complies with sustainability guidelines. The pellets will be produced from a mix of softwood and hardwood.
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