Green Plains Begins Operations At Former VeraSun Ethanol Plant
Platts : July 13 2009
A former VeraSun ethanol plant in Ord, Nebraska, has been restarted by Green Plains Renewable Energy, which also plans to restart a second plant soon due to improving margins, it said Monday.
First production from the Ord plant is expected July 17, the company said Monday.
Green Plains signed definitive agreements in May to buy the plants in Ord and Central City, Nebraska, for $123.5 million from AgStar Financial Services, which purchased the assets in the VeraSun bankruptcy auction earlier this year.
The Ord plant, which has annual production capacity of 50 million gallons, had been idle since November. The Central City plant, capable of producing 100 million gal/year, is expected to resume operations later this month, according to a statement from the company.
“With improving margins in our industry, we were anxious to start production at the Ord and Central City plants as soon as possible,” said Green Plains’ President and CEO Todd Becker.
The purchase of the plants increased Green Plains’ ethanol production by 45% to 480 million gal/year from 330 million gal/year.
Becker said in a May interview with Platts the plants are in close proximity to large feedlot operations and corn supplies, which will reduce energy and feedstock costs at the facilities. “The Central City and Ord plants share the same process technology deployed at the majority of our plants, which should allow us to integrate them into our business with little disruption,” Becker said.
VeraSun and 24 of its subsidiaries filed for US Chapter 11 bankruptcy protection in late October 2008, citing significant losses in 2008 due to “dramatic increases in corn cost, reflecting in part costs attributable to the company’s corn procurement and hedging arrangements and historically unfavorable margins.”
Omaha, Nebraska-based Green Plains operates four other ethanol plants in Iowa, Indiana and Tennessee, and also operates an independent third-party ethanol marketing service, with a marketing reach of 305 million gal/year.