Indiana city negotiating with new owners of idled ethanol plant

By Holly Jessen | February 20, 2014

The owners of an idle Indiana ethanol plant currently being retrofitted are working on a plan to add corn oil to the facility’s coproduct mix when it restarts later this year.

The 100 MMgy plant was purchased by Noble Americas South Bend Ethanol LLC, a subsidiary of Noble Americas Corp. The company is currently negotiating a deal with the City of South Bend, for which the city would purchase the $2 million corn oil extraction equipment and the company would pay to have it installed. The proposed deal calls for the company leasing it from the city for no less than $100,000 a year for five years. “As long as they create and sustain the proposed number of jobs the equipment will revert to their ownership at the sixth year,” Chris Fielding, assistant executive direction of community investment for South Bend, told Ethanol Producer Magazine.

The proposed deal was used as an incentive for Noble Americas to restart the ethanol plant, which has been idle since November 2012. New Energy Corp., the former plant owners, filed for Chapter 11 bankruptcy protection on Nov. 9, 2012.  Once the details of the deal are finalized, the city will seek out a corn oil extraction technology through its public bidding process, Fielding said.

There are several benefits to having the ethanol plant restarted, Fielding said. With the business up and running again the city will bring in revenue by collecting taxes and wastewater fees. The ethanol plant is the largest customer of the city’s wastewater plant. It also means the addition of 50 well-paying jobs at the ethanol plant and additional jobs at the adjacent CO2 facility.

ICM Inc. will retrofit the ethanol plant.