News | December 2013

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USDA Announces Availability of Funding

U.S. Dept. of Agriculture (USDA) announced the availability of $181 million to develop commercial-scale biorefineries or retrofit existing facilities with appropriate technology to develop advanced biofuels. “This financing will expand the number of commercial biorefineries in operation in the U.S. that are producing advanced biofuels from non-food sources,” according to a USDA statement.

The Biorefinery Assistance Program was created through the 2008 Farm Bill and is administered by USDA Rural Development. It provides loan guarantees to viable commercial-scale facilities to develop new and emerging technologies for advanced biofuels. Eligible entities include Indian tribes, State or local governments, corporations, farmer co-ops, agricultural producer associations, higher education institutions, rural electric co-ops, public power entities or consortiums of any of the above.

Applications for biorefinery assistance are due by January 30, 2014. More information about how to apply is available in the October 2, 2013 Federal Register announcement or by contacting the USDA Rural Development National Office.

Gates Ventures Invests In KiOR Project

KiOR, Inc. announced the ­execution of $100 million in equity related financing in two separate trans­actions to support the company’s recently announced expansion of cellulosic biofuels­ pro­­duc­tion capacity in Columbus, Miss., called the Columbus II Project.

KiOR has received $85 million of committed financing from Khosla Ventures III, and various other Khosla entities, and $15 million of committed financing from Gates Ventures, LLC, an affiliate of Bill Gates.

“I was impressed when I visited KiOR’s Columbus facility and learned more about the company’s technology,” says investor Bill Gates. “I am happy to be joining the other investors in support of KiOR’s efforts to move its technology forward.”

“This equity financing completes what we currently believe will be the last equity portion of the Columbus II Project, which we believe will facilitate the ability, with the re­main­der of our currently anticipated project financing requirements, to achieve positive cash flow from operations sometime in 2015,” says Fred Cannon, KiOR CEO.

Cannon also says that the combination of continuous improvement efforts and R&D ad­vance­ments may allow the existing Columbus facility to increase its targeted nameplate processing capacity to over 600 bone dry tons of feedstock per day before the end of 2014 while achiev­ing significant progress towards their long-term target yield of 92 gallons per bone dry ton of biomass.

Meanwhile KiOR still plans to continue to develop a standard scale commercial facility in Natchez, pursuing either project-level financing or strategic partnerships.

Vinod Khosla states, “I believe that KiOR’s technology for production of cellulosic biofuels can not only serve as the foundation for a successful and sustainably profitable long-term business but can also scale because of the hundreds of saw, pulp and paper mills that have been shut down and have local feedstock available, providing a much more stable and less price volatile feedstock than oil, while fueling the world’s transportation requirements with significantly less geopolitical risk and greenhouse gas emissions on a life cycle basis.”

BlueFire Also Plans To Build Pellet Plant

BlueFire Renewables, Inc. plans to build a 400,000 ton per year wood pellet production plant at its facility in Fulton, Miss., to complement a 9 million gallon per year ethanol plant for which preliminary site work has been completed. The pellets will be sold under long-term contracts into the European mandated renewable energy market.

BlueFire received a Grant of $88 million under the American Recovery and Reinvestment Act in December 2009.

Georgia Biomass Receives Certifications

Wood pellet producer Georgia Biomass, LLC, Waycross, Ga., has received European Pellet Council ENplus A1 certification, enabling the company to fortify its position in European commercial and residential heating markets.

The company has recently signed supply contracts with different companies for up to 660,000 metric tons per year, including two large volume contracts through 2019 with Drax Group of the UK, and RWE Supply and Trading.

The company also has achieved Sustainable Forestry Initiative chain-of-custody certification for its Waycross plant. Through SFI chain-of-custody certification, companies must have a tracking system in place so they can tell customers the percentage of fiber from certified forests.

Contracts Awarded For BC Power Plants

Iberdrola Ingeniería received contracts for the construction of the Fort St James and Merritt biomass power plants in British Columbia with a combined capacity of 80 MW.

Iberdrola Ingeniería will be in charge of all stages of construction and commissioning, as well as building two transformer substations and the power lines connecting the plants to the grid.

Enviva Considers More Pellet Mills

Enviva, which already has wood pellet production capacity of 1.1 million metric tons (1.24 million tons), and has another 500,000 metric tons plant in construction, is looking at potential wood pellet plant sites in North Carolina, at Sampson and Clinton, located in the southeast portion of the state, north of the port of Wilmington.

Company officials appeared before Sampson and Richmond county board of commissioners in early September to discuss community and operational benefits and gain feedback from the county with regard to incentives and hear from county residents.

Headquartered in Bethesda, Md., Enviva operates new pellet plants it built at Ahoskie, NC (365,000 metric tons) and Northampton, NC (500,000 metric tons), and plants it purchased in recent years at Wiggins, Miss. (136,000 metric tons) and Amory, Miss. (90,000 metric tons). Enviva is currently constructing a 500,000 metric tons plant at Southampton, Va. The company ships its pellets to overseas electrical power generation markets.

As reported at the Sampson meeting, the project there would bring an investment of between $95 million to $117 million in taxable property, as well as 79 direct jobs and another 130 indirect jobs in the forest supply and logistics chain, as well as 300 contractor and project crew jobs during construction.

Enviva proposes to develop and construct a 500,000 metric ton wood pellet production facility, which would utilize wood biomass feedstock. A plant at Clinton would apparently follow the same model.

According to an Enviva statement, “Enviva is currently evaluating a number of opportunities for future growth throughout the Southeastern United States, including potential operations in the Wilmington region.”

Government Allies With Bioenergy

The Pellet Fuels Institute joined the U.S. Dept. of Agriculture and three additional biomass groups in signing a memorandum of understanding, signifying a commitment by the federal government and industry to jointly grow and promote the wood-to-energy sector.

Biomass Thermal Energy Council, Biomass Power Assn. and the Alliance for Green Heat also signed the MOU at an event held at the USDA, which featured remarks by Deputy Secretary of Agriculture Krysta Harden.

In remarks at the signing, PFI Executive Director Jennifer Hedrick highlighted the benefits of using pellets, including the significant cost savings realized when switching from fuel oil to pellets, and opportunities to contribute to better forest health and management through the use of forest residues for pellet production.

Plum Creek Purchases 500,000 Acres

Plum Creek Timber Co., Inc. has signed a $1.1 billion agreement to acquire approximately 501,000 acres of industrial timberlands, associated wind and mineral assets, and an interest in approximately 109,000 acres of high-value rural and development-quality lands from MeadWestvaco Corp.

Specifically, Plum Creek has agreed to acquire 501,000 acres of industrial timberlands in Alabama, Georgia, South Carolina, Virginia, and West Virginia for $869 million; an investment in joint ventures consisting of 109,000 acres of high-value rural lands and development-quality lands near Charleston, SC for $152 million; subsurface rights, mineral rights and wind power assets associated with the timberlands for $65 million.

The timber harvest from the acquired lands is expected to average nearly 3 million tons annually over the next 10 years, growing Plum Creek’s total annual harvest more than 15% from recent levels.

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