USDA to give $25 million to waste/ethanol plant

Source: Dan Piller • Des Moines Register  • Posted: Monday, January 23, 2012

The U.S. Department of Agriculture said Friday it has made a conditional $25 million loan guarantee for a $59.5 million biorefinery plant in Blairstown that will produce 3.6 million gallons of ethanol annually from municipal solid waste and other industrial pulps.

The plant will be constructed adjacent to an existing facility owned by Fiberight, a Virginia-based LLC.

Fiberight received a $2.5 million grant from the Iowa Power Fund in 2010. The entire project is estimated to cost $59.5 million.

Fiberright chief executive officer Craig Stuart Paul said he hoped to begin construction by summer with production to begin by late this year or into 2013.

The plant will be one of three cellulosic biofuels plants planned for Iowa, joining the corn residue plants to be built in Nevada, by DuPont-Danisco, and at Emmetsburg by Poet. Iowa already has a nation-leading 41 cornfed ethanol plants and 13 biodiesel plants that use mostly animal fats as feedstock.

Fiberight bought the ethanol plant from Xethanol Corp., which had closed the facility in 2009 due to high corn and natural gas prices.

The 55,000 square foot Blairstown facility will produce about 3.6 million gallons of cellulosic ethanol per year, a relatively small production compared to the 50-100 million gallon annual production commonplace at Iowa’s 41 cornfed ethanol plants.

The USDA said “Fiberight must meet specified conditions before the loan guarantee can be completed. Other funding comes from the State of Iowa. The company will work with the Benton County landfill to supply a portion of the feedstock for the project. The total project cost is estimated at $59.5 million.

Stuart-Paul said he was confident the plant could meet due diligence requirements by lenders and investors. He said the Blairstown project would be much different that a cellulosic plant in Georgia that closed recently.

“The Georgia plant had to buy the wood chips,” Stuart-Paul said. “People will pay us to take solid waste.”

He said he is offering $30 per ton for solid waste and already has an agreement to take solid waste from Benton County, in which Blairstown is located. Stuart-Paul said he also expects to use paper refuse from a mill in nearby Cedar Rapids.

Stuart-Paul comes to biofuels via the solid waste recycling business. He a large regional recycling center in Virginia, processing over 150,000 tons of recycled materials annually before he sold the business to a Fortune 50 company in 2004. Mr. Stuart-Paul then formed Atlantic Recycling Technologies, LLC and Fiberight LLC to develop advanced fiber recovery and alternative fuel technologies.