ZeaChem awarded USDA loan guarantee for biorefinery

Bioenergy company ZeaChem has been awarded a $232.5 million (€176 million) loan guarantee from the US Department of Agriculture (USDA) to build a biorefinery that will convert biomass into sustainable fuels and chemicals.

It will be the company’s first commercial size cellulosic biorefinery and will use woody biomass and agricultural residues to produce bio-based fuels.

Speaking to Biofuels International, ZeaChem’s CEO Jim Imbler says: ‘Development of the commercial plant is actively underway. With this conditional loan guarantee in place, ZeaChem will seek to close financing on the commercial plant by the end of 2012, start construction in 2013, and begin operations in 2014.’

The total cost of the facility is expected to be just over $390 million. The plant will have the capacity of 25 million gallons a year and will be situated in the Port of Morrow in Boardman, Oregon, next to ZeaChem’s existing 250,000 gallons a year demonstration biorefinery.

The commercial facility is projected to utilise 650 bone dry tonnes of biomass per day, about 225,000 tonnes per year. This is the total feedstock demand for woody biomass (dedicated crop) and wheat straw (supplemental).

The company will source its woody biomass from the GreenWood Tree Farm Fund which is a local company that is controlled by GreenWood Resources, and will also collect its biomass from other nearby agricultural residue processors.

During the construction phase, about 188 jobs are expected to be created, and following this around 65 people will work at the facility full time.

At the demonstration plant, core operations have already begun and the project which allows for cellulosic ethanol to be produced should be finished this year.

Imbler says: ‘This commitment allows us to move forward with securing financing, beginning construction, creating jobs in the community, and producing economical and sustainable products for the fuel and chemical industries.’

US agriculture secretary, Tom Vilsack, adds: ‘This project, and others like it will help establish a domestic advanced biofuel industry that will create jobs here at home and open new markets in the pacific northwest and across America.’

The USDA is backing the bank loan guarantee and Silicon Valley Bank is the lender of record for the loan guarantee and is the actual recipient.