White Energy, Abengoa idle plants; Hugoton building continues

By Susanne Retka Schill | January 30, 2013

High corn prices, difficult supplies and tight margins have taken three more ethanol plants offline in recent weeks.

 “Margins are terrible now, we’ve shutdown at Plainview (Texas) and reduced rates at Hereford (Texas),” Ron Dunbar, vice president of ethanol manufacturing for White Energy Holdings LLC said. Both plants are 120 MMgy destination plants railing in corn and milo. Being in the middle of the nation’s largest cattle feeding area, Dunbar said they gave their distillers grains customers early notice of their plans. “We’ve had a major drought for two years now,” he added, “and it’s affected cattle feeders in the area.”

Christopher Standlee, executive vice president for Abengoa Bioenergy U.S. Holding Inc., said Abengoa has temporarily stopped production at its 55 MMgy plant in York, Neb., and its 88 MMgy plant in Ravenna, Neb. “The Nebraska plants have stopped taking grain,” he said, “After processing the grain on site and completing the fermentation and distillation of those gallons, the facilities will begin to implement a temporary idle status. We expect this production stop to be temporary in nature, and it is our intention to resume production activities at both plants when market conditions improve.” 

“This was a difficult decision that has become necessary as a result of the continuation of unfavorable market conditions that have been plaguing the industry throughout 2012,” Standlee continued. “We are still very optimistic about the long term future of the ethanol industry, and we will maintain these Nebraska facilities in a ready mode available for restart on short notice.  However, for the near term we have decided to focus on continuing to support production operations at our two newest and largest plants located in Indiana and Illinois, and also the construction efforts on our new commercial-scale cellulosic ethanol facility we are building in Hugoton, Kan.”

Standlee reported the construction of the 25 MMgy cellulosic facility is proceeding on schedule. “To date we have purchased and stored over 50,000 tons of wheat and corn crop residues at or near our site, and much of the construction work is complete,” he said. Multiple 1.5 million gallon fermentation tanks are installed, two 6 million gallon wastewater treatment tanks are installed, the distillation columns are erected, the cooling tower is complete, the boiler and baghouse structures are complete and major equipment pieces have been set, and all equipment is either on site or order. “Initial start-up is still expected before the end of this year as planned,” Standlee added. “More specifically, we plan to start up the cogeneration portion of the facility in the fall, and start up the ethanol production before year end.”