Danish bioscience company plans to invest $36 million in Blair plant

Source: By Russell Hubbard, Omaha World-Herald • Posted: Thursday, May 18, 2017

BLAIR, Neb. — Danish bioscience giant Novozymes plans to invest another $36 million in its plant here, saying it is counting on the ethanol industry’s continued growth.

The expansion adds to a string of economic development triumphs for Omaha’s small neighbor to the north.

Within a few weeks, the Blair plant will increase by half fermentation capacity of enzymes that ethanol plants use to squeeze more starch from each kernel of corn, said Kyle Nixon, the plant’s general manager. With the expansion, perhaps a half-dozen new hires will be added to the workforce of about 125 people.

But the investment in new tanks and related appurtenances where ethanol-encouraging enzymes are fermented from freeze-dried fungus marks Novozymes as certain that the Iowa and Nebraska corn/ethanol/cattle cycle is worthy of continued aggressive investment. The company has annual revenue of about $2 billion.

“We are very optimistic,” Nixon said in an interview after a press conference Tuesday. “There is nowhere else that can do this.”

He was talking about Blair, not far from the border between Iowa and Nebraska, the two largest ethanol-producing states in the union. While Novozymes doesn’t make ethanol, its enzymes — molecules that act on other molecules to unlock chemical reactions — allow ethanol plants to get more ethanol per kernel.

It has all made Blair, population about 8,000, something of a bio-agriculture hub after Minnesota-based ag giant Cargill built an ethanol plant there some 20 years ago. Not far from Novozymes, it has doubled its corn crushing in five years, now consuming 300,000 bushels a day. Last year, Cargill said a Swiss partner announced plans to invest $60 million in Blair to produce an artificial sweetener. Since 1995, more than 1,200 jobs have been created in Blair related to ag science.

“I’ve got the easiest mayoral seat in the state,” said Blair Mayor Jim Realph. “I’ve got more jobs than people.”

Lisa Scheve, executive director of the Gateway Development Corp., Washington County’s business recruiting authority, called it “another remarkable economic development win” for Blair.

“This solidifies us as a major player in biofuels globally,” Scheve said.

The optimism is based on the ethanol economy. The alcohol-based fuel is the standard additive gasoline companies use to boost octane in clear formulations, leading to the common E10, with 10 percent ethanol. More retail chains are adopting E15 blends, while exports of U.S. ethanol are reaching record levels as developing nations look to it as a solution to their air pollution problems.

“This is how we grow Nebraska,” Gov. Pete Ricketts said at the event Tuesday at the Blair plant. “These are great, high-paying, high-skill jobs, and this is a great commitment to our bio-sciences industry.”

In 2015, Ricketts visited with Novozymes officials on a European trade mission and pitched them on expanding the Blair plant to serve the state’s increasing ethanol production.

Ricketts said the federal Environmental Protection Agency, charged with setting ethanol-blending requirements, appears much more sympathetic to the industry since the presidential election, calling President Donald Trump a supporter of biofuels. U.S. ethanol plants are expected to produce about 16 billion gallons of corn-based ethanol in 2017 under the federal Renewable Fuel Standard formulated after laws last decade mandated the blending of renewable fuels into the gasoline supply.

“But it is a lot more than motor fuel,” said Todd Sneller, administrator of the Nebraska Ethanol Board. “It is generating this kind of capital investment, and it is enzymes, advanced chemicals and investment in research and development.”

As for Novozymes, which claims about half of the global market for industrial enzymes, it sees Blair as the happy place where corn, ethanol and the leftover grains from ethanol production that go for cattle feed as a global sweet spot for its science, said Nixon, the Blair plant manager.

He said that the plant has been running at 95 percent capacity recently and that the bosses is Denmark are “very bullish” on what is going there.