Scoular acquires Kansas ethanol plant, shuttle facility

By Holly Jessen | February 17, 2011

The Scoular Company has acquired Gateway Plant LLC along with an adjoining 1.8 million bushel shuttle train facility. Although Scoular is in discussions with other companies about partnering in operating the plant, the company is prepared to start on its own. “It is economically feasible to run this plant, and that’s what we want to do,” said CEO Chuck Elsea. Terms of the sale were not announced.

The 55 MMgy ethanol plant in Pratt, Kan., will be extensively renovated. “We have to reinstall a boiler package and do significant work in the distillation dehydration and evaporation and area of the plant,” John Heck, senior vice president, told EPM. One of the goals of the renovation is to get the plant up to its full nameplate capacity of 55 MMgy, which it was not producing when it shut down in 2007.

The company anticipates that the facility will be ready to receive grain by April 1 and hopes the plant will be operational late third or early fourth quarter of 2011. By the time the ethanol plant is operating it will employ about 40 people. Jeff Wilkinson will serve as Scoular’s interim manager.

The plant was scheduled to go on the auction block this fall, with the owners reserving the right to accept offers made before the auction. The auction was halted in September as Scoular completed its due diligence before publicly announcing the purchase Feb. 15. The $100 million plant started producing ethanol in October 2007 but filed for bankruptcy a year later after several shutdowns for repairs and due to limited working capital.

This isn’t the company’s first foray into ethanol plant ownership. Scoular is a minority investor in three western Corn Belt plants, Heck said.

The newly dubbed Pratt Energy LLC plant is located on the Union Pacific Railroad and is capable of loading 100-car shuttles of grain, dried distillers grains and ethanol. The primary purpose will be to bring in feedstock for the plant, Heck said. It will also be used to load outbound trains with distillers grains and ethanol.

The ethanol plant will be incorporated into the company’s grain marketing network, which includes other investments in Kansas. Scoular now owns eight facilities in the state, including other shuttle train loading facilities in Coolidge, Downs, Salina and Wellington. It’s also a service provider of risk management, grain origination, logistics and transportation, as well as distillers grains marketing. By early March the company will open its new rail-to-truck ethanol transload facility in Ogden, Utah.

In all, The Scoular Company has more than 70 locations across North America.