Saskatchewan ethanol plant gets new owner

By Erin Voegele | January 06, 2014

Ontario-based Just Energy Group Inc. has closed on the sale of Terra Grain Fuels Inc. to a group of Saskatchewan businesses. The 150 MMly plant is located in Belle Plaine, Saskatchewan.

Just Energy announced the sale on Dec. 12 and the transaction closed on Dec. 24. Al Shulman, vice president of marketing for Just Energy, confirmed the sale but was unable to share any additional information on the businesses that purchased the plant. He told Ethanol Producer Magazine that the buyers wish to remain anonymous at this point.

While Shulman noted he cannot speak for the purchasers, he said that the group has indicated that they have every intention of continuing to operate the plant. “It is our understanding from the buyers that they have no plans to impact the operations of the plant or make any significant changes regarding the employees,” he said.

According to Shulman, Just Energy acquired the ethanol plant as part of an early acquisition and he noted that it is not part of his company’s core competency. “While we believe in ethanol and alternative energy sources running a production facility is not our strength and we need to focus on what we are best,” he said.

A regulatory filing made by Just Energy in 2009 specifies that its wholly-owned subsidiary Just Energy Exchange Corp. acquired Universal Energy Group Ltd. In July 2009. UEG was the majority owner of the Terra Grain Fuels plant.

"We are pleased to announce the sale of Terra Grain. From the time that we indirectly acquired the facility with the acquisition of Universal Energy Group Ltd., we have worked to bring the plant up to its production capacity. This was done thereby supporting employment in Saskatchewan and offering a ready market for local wheat producers. However, difficult market conditions for ethanol production confirmed our initial view that this was a non-core asset to Just Energy,” said Rebecca MacDonald, executive chair of Just Energy in a statement released in mid-December.

According to information released by Just Energy, pursuant to the transaction, the purchaser acquired Terra Grain for a nominal purchase price. In addition, Just Energy was released from all of its obligations to serve providers to Terra Grain under letters of credit and guarantees.