Company expands corn oil extraction, signs agreement with lenders

By Holly Jessen | November 06, 2012

Pacific Ethanol Inc. recently announced it would add corn oil extraction technology to one of its ethanol plants and, separately, that it had secured a new $10 million revolving line of credit from its existing lenders.

The company, which operates and manages four ethanol plants, one of which is idled, said Nov. 5 that it had contracted with Edeniq to install its patented corn oil extraction technology at the 60 MMgy Pacific Ethanol plant in Stockton, Calif. Implementation of OilPlus, a trademarked technology, is expected to be completed by the second quarter of 2013. The same system was previously installed at the 60 MMgy facility in Burley, Idaho.

“Corn oil is a high value coproduct for the Pacific Ethanol plants, provides us with further diversification of our revenue streams and contributes additional operating income to the plants,” Neil Koehler, the company’s president and CEO said in a prepared statement. “Our Stockton plant is the second of our facilities to implement corn oil separation technology, and we expect to soon award contracts for our two other Pacific Ethanol plants.”

The company’s announcement that it secured a new $10 million revolving line of credit came out Nov. 1.  The credit will be used to provide additional working capital supporting plant operations and will augment the company’s a $40 million revolving credit facility that was already in place.

Pacific Ethanol owns 67 percent interest in New PE Holdco LLC, the owner of the four Pacific Ethanol plants. The plants in Burley, Stockton and Boardman, Ore., are currently operating while the fourth plant, in Madera, Calif., has been idled for quite some time. Back in August, when the company released its second quarter financial results, it said production levels had been moderated in response to adverse market conditions. Paul Koehler, vice president of corporate development, told Ethanol Producer Magazine on Nov. 5 that the company doesn’t report specifically on production levels but confirmed that run rates were still dialed back, as they had been in August.