ZeaChem teams with Pacific Ethanol to operate demo plant

By Kris Bevill | October 25, 2011

Cellulosic ethanol and biochemical firm ZeaChem Inc. has signed an agreement with California-based ethanol producer Pacific Ethanol Inc. to provide operations, maintenance and accounting services for ZeaChem’s 250,000 gallon per year demonstration-scale facility in Boardman, Ore. The agreement calls for Pacific Ethanol Management Services Corp., a subsidiary of Pacific Ethanol Inc., to begin providing operational services for ZeaChem in the fourth quarter.

“This agreement reflects the value of our diversified business models as we extend our asset management expertise beyond the four Pacific Ethanol plants to provide plant operating and maintenance services to ZeaChem,” said Pacific Ethanol President and CEO Neil Kohler. “We are well-positioned to leverage our extensive knowledge of low-carbon renewable fuel production to operate and maintain ZeaChem’s advanced cellulosic biorefinery.”

Pacific Ethanol owns a 20 percent ownership stake in four corn-based facilities representing a combined operating capacity of 200 MMgy. It manages and operates facilities in Burley, Idaho, Boardman, Ore., and Stockton, Calif. The company’s Madera, Calif. facility is currently idled. ZeaChem’s demo plant is scheduled to begin producing bio-based chemicals by the end of this year using hybrid poplar as its primary feedstock. Cellulosic ethanol production is expected to commence in the first half of 2012. The company also recently received a USDA grant to develop biogasoline and jet fuel production from hybrid poplar.

Pacific Ethanol’s Columbia plant is located adjacent to ZeaChem’s demonstration facility in Boardman. ZeaChem CEO Jim Imbler said the close proximity of the facilities was a factor in his company’s decision to bring in Pacific Ethanol’s operational team. “ZeaChem chose Pacific Ethanol’s O&M services because they are already in place at their Columbia ethanol facility,” he said, adding that the deal will allow ZeaChem to cost-effectively start up its facility while remaining focused on the technical and management efforts necessary to commercialize its technology.