For almost three years, Olaoluwa Bamikole had been trying to reach the United States from Nigeria to attend the International Fuel Ethanol Workshop & Trade Show (FEW). As a chemist and private consultant to the fuel ethanol industry in Nigeria, Bamikole was fascinated by the FEW's growing international presence. Not only was he interested in the production knowledge he could gain at the event, but also what he could share with others.

 	
 In 1999, 2000 and 2001, Bamikole's FEW travel plans were repeatedly foiled by visa problems. As the years passed, hopes of him ever reaching the conference were slowly wilting. Bamikole's persistence, however, had not waned. 
 	
 Needless to say, when Nigeria's favorite ethanol consultant strolled into last month's FEW Trade Show and began exchanging heartfelt handshakes and hugs with his international colleagues, the event was already a grand success. Bamikole had finally arrived. 
 	
 "It's better than I imagined," he said, when asked if the event was worth his persistent effort. "To finally be here. . . I am overwhelmed." 
 	
 And you didn't have to be from Nigeria to be overwhelmed by this year's FEW. 
 	
 Based on attendance, the FEW is now widely considered the world's largest ethanol industry event. From its modest beginnings as a small workshop 18 years ago, with 40 attendees and no exhibitors, the event has become an internationally acclaimed conference, drawing delegates from around the world to the Midwest each year. In addition to Bamikole, this year's list of attendees included representatives from China, India, Ukraine, Australia and 17 other nations. 
 	
 Weeks before the 2002 FEW began, it was predicted to be the largest ethanol industry event in U.S. history. Attendance was officially pegged at 1044, up 300 from last year. Remarkably, the 2002 FEW Trade Show held a record 110 exhibitors, comprised mainly of industry suppliers and service providers representing every facet of the global ethanol industry. 
 	
 "FEW attendance is growing at a rate better than 30 percent a year," said BBI International President Mike Bryan. "The event is sailing on a powerful wave right now, due to the extraordinary growth of our industry. In terms of attendance, we expect to surpass at least one major petroleum industry conference by 2004. Considering the size of the ethanol industry compared to the oil and gas industry, an accomplishment of that nature would be an important milestone for renewable fuels."
 	
 Angela Graf, BBI International director of conferences and international development, commended the many sponsors and industry partners that made this year's FEW a tremendous success. "Their support helps bring the event together year after year," Graf said. "It's a truly collaborative effort, and a real testament to the vibrancy of our industry." 
 	

 A prolific agenda of presentations and breakout sessions coupled with ethanol plant tours of facilities that rank among America's best and biggest. Attendees toured Williams BioEnergy's 100 mmgy wet-mill plant in Pekin, Ill. on June 25, and Archer Daniels Midland's (ADM) giant Decatur plant on June 28. 
 
 A well-planned agenda
 Thanks in large part to three ethanol plant general managers who made up the steering committee for the 2002 FEW, the foundation for a meaningful and highly interesting agenda came to life at this year's event. Randy Doyal of Al-Corn, Roger Burken, of Chief Ethanol, and Nate Kimpel of New Energy Corporation worked with BBI International in developing the agenda topics for the FEW. 
 	
 "We faced a big challenge - and those gentleman helped us meet it head on," said BBI International Vice President Kathy Bryan. "We have a very diverse audience, ranging from people recently introduced to ethanol to highly experienced producers and very technical researchers. Also in recent years, there have been increasing numbers of international participants. Many thanks to Roger, Nate and Randy for their valuable input and knowledge."
 
 Pre-Workshop Seminar
 A crowd of over 200 attended the growingly popular Pre-Workshop Seminar June 25. Considered a special opportunity to learn the basics of ethanol production, the "ins and outs" of ethanol plant operations, and important factors for building an ethanol plant, the Pre-Workshop Seminar served as an important primer for those wanting to know more about the fundamentals of ethanol production and those interested in building an ethanol plant.
 	
 Boyd Ruppelt, a BBI International associate, presented a review of the basics of ethanol production, including a fundamental contrast/comparison of dry-milling and wet-milling in Ethanol 101: Ethanol Production Process and Common Operational Issues. 
 	
 "Dry-milling is a fairly straightforward process, wet-milling is a totally different animal," Ruppelt said. "When considering dry vs. wet-milling you must consider capital investment, the complexity of your operation, the stability of your product markets and the experience of the ownership."
 	

 Ruppelt explained that the construction costs alone of a wet mill plant typically double that of a dry mill operation of the same size (e.g., 40 mmgy ethanol plant: dry/$45 million, wet/$92 million). However, the diverse product - and revenue - streams produced by wet-milling is sometimes a cost efficient alternative for producers with more equity. 
 	
 Attorneys David Swanson of Dorsey & Whitney LLP and Bill Hanigan of Brown, Winick, Graves, Gross outlined the pros and cons of various financing structures in Options for Financing an Ethanol Plant: S Corp, C Corp, Limited Liability Corporations and Co-ops. Primarily, Swanson and Hanigan explained the LLC legal structure that has become very common among new producers in recent years. 
 	
 "When I graduated from college 20 years ago, there were corporations and partnerships - it was that simple," Hanigan said. "In the ethanol industry, during the last 10 years, the focus has been on the farmer-owned cooperative model. The LLC structure we are seeing today is really a mix of the old benefits of both cooperatives and partnerships."
 	
 Hanigan also advised future producers to consider the importance of expanding the project's investor pool. "If you get $10 to $12 million locally - withing a 60 mile radius of your proposed site - I think you have pretty much tapped out you local market. That's why it's so important to expand your pool of investors." 
 	
 Other presentations were made by BBI International's own Mark Yancey, who presented Points to Consider When Building an Ethanol Plant: Ethanol Plant Development Handbook. Step by step, Yancey walked future producers through the elements of consideration when building an ethanol plant: location, feedstock type and availability, water, utilities, infrastructure, freight, emissions, future planning and more. 
 	
 Richard Hanson, general manager of Badger State Ethanol, discussed product marketing, including ethanol, DDGS and carbon dioxide. As more ethanol is produced in the United States, Hanson said, it will become necessary to develop new markets for ethanol coproducts. 
 	
 "One key consideration is site location," Hansen pointed out. "Are you building too close to an existing facility? And will that affect your product marketing. . . And when you are planning for the permitting process, remember that it does not happen overnight. Sometimes permitting costs several heartaches - and headaches - before it's complete. Be prepared for it." 
 	
 Jack Huggins, president of TJ3, Inc, also spoke at the Pre-Workshop Seminar, advising future producers to consider market consolidation and other alliances to get optimal prices for their products. 
 Andreas gives keynote address

 	
 Marty Andreas, senior vice president of ADM, presented a keynote address entitled "Agriculture Embraces Energy" June 26. Covering an array of ethanol and renewable energy-related topics, Andreas said ADM supports America's farmer-owned ethanol plants and plans to grow alongside these rural investors. 
 	
 "Half the facilities in the nation will be farmer-owned by the end of 2002," Andreas reminded the crowd. "I think most of the new production will be dry-mills, and I think most of the DDGS coming from those plants will be sold domestically - not exported."
 	
 Andreas said the need for greater energy independence in America should drive the ethanol movement. California, he said, is an important part of that movement. "You may have to fight a battle more than once to win it." Andreas said. "That's how we feel about ethanol in California."
 
 Television Show Taped at Event
 Ag Day Network's "Weekend Marketplace" took center stage at the FEW June 26, when TV personality Al Pell interviewed three industry leaders on the developments and progress made in the ethanol industry over the past year. The segment was taped for broadcast on Ag Day Network's "Weekend Marketplace" morning television program the following Saturday.
 	
 Promising not to throw "Larry King-style softballs" at his guests, Pell posed thought-provoking questions to Bob Dinneen, president of the RFA, Bliss Baker, president of the Canadian Renewable Fuels Association, and Richard Tolman, CEO, National Corn Growers Association (NCGA). 
 	
 General session rolls on
 Wednesday morning's general session proceded to include an important presentation by Novozymes's Starch and Ethanol Industry Technical Services Manager Larry Peckous, who took a step back in time to look at the series of incremental changes and steps that have affected ethanol production. 
 	

 Kathy Bryan followed, recognizing and warmly thanking the FEW sponsors and industry partners. 
 	
 Before lunch Wednesday, National Renewable Energy Laboratory researcher Cindy Riley, along with David Glassner of Cargill-Dow, and Mike Knauf of Genencor International, presented a fascinating package of information on cellulosic ethanol. 
 
 Dynamic breakout sessions 
 To popular acclaim, FEW breakout workshops began June 26 with Alcohol Level in Beer and Economics of Improving Yield, Ethanol Plant Expansions, Ethanol Research Pilot Plant: Vision and Status (of the Edwardsville, Ill. project), Emerging Uses for Biofuels, Fermentation Technology, Risk Management, Promising New Technologies, Distillers Grains/Cattle and Hog Feed. 
 	
 Breakout sessions continued June 27 with Shop Talk 3: Controlling Process Issues, Plant Management: Managing Emissions, R&D: Emerging Technologies for Dry Grind Ethanol Processes, Feedstocks for Biofuels Production. 
 
 Bothast receives Award of Excellence
 Rodney Bothast, director of the National Corn-To-Ethanol Research Pilot Plant at SIUE in Edwardsville, Ill., was this year's recipient of the Award of Excellence, in recognition of the significant contribution to the ethanol industry through research and technological developments. 
 	
 Specifically, Bothast has been accredited with leading ethanol-related research teams that have made several pioneering discoveries, including the trickle ammonia process of drying grain, the first pentose fermenting yeast, and reduced energy costs for fermentation of alcohol. 
 	

 "I was extremely honored to receive the Award of Excellence and I accept it on behalf of my many outstanding colleagues that make such an award possible," Bothast told Ethanol Producer Magazine after the FEW. "I was very surprised and appreciative to receive this prestigious award. I am looking forward to future interactions with the excellent people of this exciting and growing industry as I begin my new position as Director of the National Corn-To-Ethanol Research Pilot Plant at SIUE. Thank you all."
 
 International presenters
 Interest in ethanol is growing rapidly around the world. During World Outlook for Fuel Ethanol Production and Use, representatives from Nigeria and Ukraine discussed new developments fostering growth for ethanol production and use.
 	
 Along with Bamikole, Ukrainians Ivan Zholner, director of Ukrspirt, presented in depth updates on the nations' ethanol industries, respectively. 
 
 Industry Roundtable
 After an afternoon of fun and relaxation that included either golf, sight seeing or activities at Knight's Action Park Thursday, it was back to business Friday morning. 
 	
 Back by popular demand, conference participants gathered in Round Robin Work Groups and tackled the question, "What will the ethanol industry look like in 15 years and what needs to be done to support it?" The results from the discussions were presented at the Industry Roundtable.
 	
 The Forum of Futuristic Thinkers featured a panel consisting of process design companies, enzymes manufacturers, ethanol industry suppliers and service providers, government leaders and researchers, who responded to the issues raised by the morning Work Groups. The objective was to suggest resolutions and recommendations to further the growth of the industry (see "Thinking Ahead" sidebar).
 	
 "It is amazing to see this industry come together every year in such strong numbers - and with such passion," said Kathy Bryan. "You really get the feeling that the future of our industry is being mapped out right here in front of you."

World's largest ethanol industry event draws delegates from 22 nations

Over 1000 attend International Fuel Ethanol Workshop in Springfield, Ill.

The Renewable Fuels Association this month announced the location of the 2003 National Ethanol Conference. The event will be held at the Marriott Resort-Camelback Inn at Scottsdale, Ariz., Feb. 17-19. Registration information can be found at: wwwethanolRFA.org.

RFA Announces site of 2003 National Ethanol Conference

Over the years there have been various legislative initiatives adopted to help support the ethanol industry. The Renewable Fuels Standard (RFS), now being considered in conference, is perhaps one of the first pieces of legislation actually designed to truly grow the industry on a national level. It goes beyond just growing the industry, it speaks, for the first time, to a real change in priorities for America. It also represents a major shift in our national energy strategy. 
 	

 It would be a real mistake for any of us to think the RFS is a legislative slam-dunk. In fact, nothing could be further from the truth. This important piece of legislation needs our support in order to have a fighting chance of being adopted. As most of you know, it is often in conference committee that much of the horse-trading goes on so now is the time to act. 
 	
 On page 30 of this issue we have included a list of the Conference Committee members. We encourage you to review the list and express your support of the RFS to any of these members who happen to be from your state, and please do so right away. 
 	
 There will be many of you who do not have a Committee member from your state. Don't let that deter you from acting, because even if the language is adopted in conference, it still has to go to both floors for a final vote. It would be a shame to win in conference and lose on the floor because we did not secure the necessary votes. We strongly encourage you to contact your Congressional representatives and tell them how important the RFS package is. 
 	
 Draft a letter, mail a post card, write an email, send a fax, whatever means you have of reaching your Congressional members right away. Should you need some guidance you can contact the Renewable Fuels Association through their website at www.ethanolRFA.org. While I understand you are all busy, decide to dedicate 30 minutes to the future of your industry. Please take action today. 
 
 Mike Bryan
 President, BBI International
 mike@bbiethanol.com

We should all be urging our congressional reps to support RFS

The Way I See IT

USDA released its June 30th Acreage Report with a few surprises. To give a little history, in March, USDA gave us a corn acreage number of 78.9 million acres. In the June Crop Production Report, USDA uncharacteristically lowered corn acreage and raised soybean acreage numbers. The surprise came when USDA raised the corn acreage number back to the original March number of 78.9 in the June 30th Acreage Report and lowered soybean acreage. Many analysts expected corn acres to remain lower due to abandonment of acres in the Eastern Corn Belt due to excessive rains in the spring.
 	
 In July, USDA released the July Crop Production Report for the 02/03 crop year. The corn acres planted were left unchanged at 78.9 million acres. For the July report, the yield per acre estimate was also unchanged. Nevertheless, there has been talk in the trade that we could see yield declines of 2 to 5 bushels per acre because of the continued hot and dry weather throughout critical portions of the Corn Belt. Beginning stocks remained the same at 1.621, whereas corn production increased from 9.650 to 9.790 billion bushels in the July report. 	
 	
 Feed and residuals, along with food, seed, and industrial use remained the same. USDA export projections for the 02/03 crop year were lowered to 2.050. Ending stocks were increased with this report due largely to the increase in the corn production numbers. The question that remains is what will the August Crop Production report say? Will it lower yield numbers, which would consequently lower crop production and possibly ending stocks, or will the numbers remain the same? 
 	
 Significant changes in numbers also may be seen if the weather across the Midwest continues to stay hot and dry. If this scenario continues, just how high can corn go?

July Corn Report Analysis

North Dakota Governor John Hoeven is Vice Chair of the Governors' Ethanol Coalition. He recently mandated that all North Dakota fleet vehicles use 10 percent ethanol-blended fuel. North Dakota currently has just two ethanol plants, but several groups are exploring plans to build facilities in the state in the near future. 

 
 EPM: Will more ethanol plants be built in North Dakota? How much ethanol production would you like to see in the state? 
 
 Hoeven: Yes, we expect to see more ethanol plants in North Dakota. We are pursuing a multi-resource energy strategy in our state, including coal, oil, gas, wind, biodiesel and, of course, ethanol. As an agricultural state, moreover, ethanol is a natural for us. We currently have two ethanol-producing plants in North Dakota, which combined produce 34 million gallons of ethanol annually. I hope the state will soon have one or more new ethanol facilities that will double, or even triple, the state's production.
 
 EPM: In the long term, how could ethanol production positively affect North Dakota and add value to the crops North Dakota farmers grow?
 
 Hoeven: Energy development and agriculture represent two of the six pillars on which we are building our future in North Dakota. With ethanol, our efforts in energy production and agriculture dovetail nicely - and that promises to be the case for some time to come in light of the renewable fuels standard currently pending in the new energy bill. It is no secret that the real value in any agricultural product is not in production; it is in processing. A box of cereal can sell for twice as much as a bushel of corn. By processing corn and other crops here in our state, rather than exporting them elsewhere, we create jobs for our citizens and new markets for our farmers - and we "add value" to what they grow. Ethanol is good example. A bushel of corn will produce about two-and-a-half gallons of ethanol, which may add about 20 percent of added value to the commodity. Plus, much of the feed value of the corn is retained for livestock, adding additional value. Add jobs and the potential to revitalize our rural economies to the mix and ethanol production is a clear winner for North Dakota. Ethanol production creates new markets, added value, and therefore greater independence, for our farmers.
 

 EPM: Does ethanol have bipartisan support in North Dakota? If so, why?
 
 Hoeven: Ethanol does have bipartisan support. Creating jobs and new opportunities for our farmers isn't a partisan issue. No matter where you stand on the political spectrum, ethanol is clearly good for our farmers, good for our environment and good for our economy.
 
 EPM: Why do you support the renewable fuels standard that is currently pending in the national energy bill?
 
 Hoeven: The renewable fuels standard favorably addresses three important issues for us in North Dakota and nationally: it is healthy for our environment, healthy for our economy and healthy for our security, in that it reduces our dependence on imported oil. MTBE will be banned or restricted in 13 states by 2003-2004, and those states will have to find a way to meet the oxygen requirements of the Clean Air Act Amendment of 1990. Ethanol, as a clean alternative to MTBE, fills that need. I recently chaired a meeting of the National Governors Association Natural Resources Committee and the topic of discussion was "Achieving and Maintaining Clean Air through National Energy Policy" and "Putting Clean Energy To Work." I invited Secretary of Energy Spencer Abraham to address the group. We discussed the relationship between clean air and national energy policy, and how the private sector is moving forward to show leadership. What became clear in the course of the discussion was the fact that modern energy policy must factor the environment into the equation in order to succeed. That's what we are doing in North Dakota, and that promises to be national policy going forward.
 
 EPM: In January, you directed the state fleet to use 10 percent ethanol-blended fuel. What factors helped you make this decision? 

 
 Hoeven: We have two ethanol plants in North Dakota, and we have seen interest in building more plants in the near future. As a state, I felt it was essential that we demonstrate a commitment to developing this industry, not merely in word, but in deed. The best way to do that, I thought, was to become a committed customer of the product. In adopting an ethanol blended fuel in state vehicles, we were able to take a step toward greater ethanol production and at the same time demonstrate a commitment to maintaining our pristine air quality in North Dakota, which, incidentally, is one of only 14 state's in the nation that meets all national ambient air quality standards.
 
 EPM: What makes ethanol production a natural fit in North Dakota?
 
 Hoeven: North Dakota is the leading agricultural producer of 13 major commodities, and more than 70 crops in all. At the same time, we are the sixth leading energy producing and exporting state in the country, committed to expanding our energy capacity using multiple traditional and alternative energy resources, such as coal, natural gas, wind and biodiesel. We are aggressively promoting development of value-added agriculture enterprises in our state, and the imminent increase in demand for ethanol makes it a perfect ag-energy partnership in our state. In North Dakota we grow corn, barley and other crops that can be processed into ethanol. Our agricultural sector can more than meet the demand for ethanol production. Add to these a plentiful water supply for manufacturing, an educated workforce with an incomparable work ethic, and you have all the ingredients for ethanol production

Gov. John Hoeven taking big strides for future ethanol producers on the Northern Plains

North Dakota Governor working hard for ethanol

Colorado-based BBI International, consultants to the fuel ethanol industry, is co-sponsoring a series of three Regional Ethanol Symposiums for Lenders with USDA Rural Business - Cooperative Services and the Washington, D.C.-based Renewable Fuels Association (RFA). 
 
 Lenders are a critical element in the growth of the ethanol industry and this series is designed to enhance the knowledge base about ethanol production and policy matters amongst those who are financing these value-added projects.
 	
 The first symposium took place July 18-19, in San Francisco. Additional symposiums will be held in Chicago, Aug. 21-22, and New York, NY, Aug. 28-29. 
 	

 "The information provided at the San Francisco symposium was absolutely invaluable to me," said Cindy Holland of CoBank.
 
 Who should attend?
 The symposiums are open to lenders and and representatives of financial institutions that have either been asked to finance a renewable energy project, or anticipate that they will be. BBI strongly encourages these professionals to register for the symposiums immediately, as space is very limited.	
 	
 Each Regional Ethanol Symposium for Lenders will address the following issues, and more:
 - Public policies that impact the industry's future 
 - The value-added concept for rural America 
 - The farmer-owned cooperative structure 
 - Financing requirements 
 - Ethanol markets 
 - Coproduct markets 
 - Energy requirements and costs 
 - Typical financial projections, risks and benefits 
 - A final discussion forum with experienced lenders 
 

 Please contact BBI International with any questions you may have: 719-942-4353.
 A brochure (PDF-94k) with a registration form is available for download - online registration is also available for Chicago and New York.

Regional Ethanol Symposiums for Lenders in San Francisco, Chicago, New York

Ace Ethanol completed construction of its plant and began producing ethanol last month. Ace Ethanol is the first dry mill ethanol plant to operate in Wisconsin. Located outside of Stanley, Wisconsin, the plant will process over 6 million bushels of corn per year into 15 mmgy and 44,000 tons of distillers dry and wet grains. The plant will also capture and market 40,000 tons of carbon dioxide per year. Ace Ethanol is expected to employ 30 people at the plant.
 	
 "We are proud to be the first large dry mill ethanol plant in Wisconsin," said Terry Kulesa, Ace Ethanol general manager. "Now some of the ethanol that Wisconsin uses will be produced in the state. It gives the farmers in Wisconsin another market for their corn and allows us all to benefit from a domestically produced renewable fuel source."
 	
 While Ace Ethanol acted as its own general contractor, Delta-T, of Williamsburg, Virginia, served as the design-build firm and provided the technology, engineering and procurement of the equipment. The plant was constructed to be easy to expand in the future. "A big pat-on-the-back to Ace for showing the world that there is still room for a 15 million gallon per year fuel-ethanol plant as a solid business investment," said Rob Swain, vice president of Delta-T Corporation. "Our partnership with Ace has proven that with a strong business plan and management team, combined with the latest designed technological efficiencies and environmental options, a plant this size can be very profitable and worthy of capital funding. We look forward to working with Ace for a lot of years to come in helping them maintain a competitive edge in the fuel-ethanol market."

Plant is first dry-mill ethanol production facility in Wisconsin

Ace Ethanol begins production

Kelly Davis has been involved with the grain processing industry in ethanol production for the past 19 years. Prior to joining Chippewa Valley Ethanol Company (CVEC) in Benson, Minn., she worked at the 65 mmgy South Point Ethanol plant in southern Ohio. Before converting to ethanol fuels she held various lab tech positions in the petrochemical industry with Ashland Oil Inc. Kelly worked 13 years for Ashland at the South Point Ethanol plant as the Lab Supervisor. She has also been chairperson of the research committee of the trade association Distillers Feed Research Council and currently enjoys working with the expanded uses team of the Minnesota Corn Growers Association. As Quality Manager of CVEC she is responsible for assuring valid data from the lab operations and quality of products as well as duties in safety and environmental compliance. Kelly grew up in Huntington, West Virginia and graduated from Marshall University with a Bachelor of Science in Chemistry, with minors in Math and Physics. She is married and raising two sons. The family resides in Starbuck, Minn.
 
 Considering how Kelly Davis ended up at Chippewa Valley Ethanol Company, it's fitting that she has once again landed in the pages of our publication. 
 	
 In 1996, after Ashland Oil Inc. closed South Point Ethanol in Ohio, where Kelly had been a longtime lab supervisor, she reluctantly considered leaving the ethanol industry and returning to petrochemicals. It was a difficult decision, to say the least. After 13 years in the ethanol busin
 ess, Kelly was torn between an industry she revered, and a respected company she had been with since college. 
 	
 "I was a young chemist who had become very fond of the ethanol industry. That's what ethanol does to people," Kelly said. "It's natural to have a lot of passion and enthusiasm for this business."
 	
 Kelly said it was BBI International's Kathy Bryan who encouraged her to stay with ethanol for the long haul. Courageously, Kelly agreed. 

 	
 "Kathy encouraged me to place a classified ad in the Energy Independent newsletter (now Ethanol Producer Magazine)," Kelly said. "I was one of the first classified ads in the publication, and it helped me stay in ethanol."
 	
 Kelly landed a job at CVEC as a lab supervisor (operator). During those early days in Benson, she worked under veteran ethanol industry chemist Jim Reynolds, someone she today considers a career mentor. 
 	
 Today, as Quality Manager at CVEC, Kelly has a diverse set of responsibilities. In addition to overseeing lab operations and product quality, she also administers safety and environmental compliance at the plant, which is currently undergoing an expansion to double capacity from 20 mmgy to 40 mmgy. 
 	
 Kelly considers herself a "technical trouble-shooter" with "analytical roots."
 	
 "I am expected to be a technical information resource at CVEC," she said. "And that allows me to take part in the research and technical world. I end up wearing a lot of hats."
 	
 Kelly has also been chairperson of the research committee of the trade association Distillers Feed Research Council and works with the expanded uses team of the Minnesota Corn Growers Association.
 	
 "I think I have really become a liaison between the politics and technical aspects of ethanol production," she said. "Any one of these things can encompass my thoughts on any given day."
 	
 The career she wanted?"I don't think that I could be doing more for America right now. I have made some big moves for someone who wasn't going to leave her hometown," Kelly said. "I'm a city girl who thought corn was grown at the Chicago Board of Trade.

 	
 "I always thought I'd be a scientist, and I am," she said. "But my career is an enhanced version of what I thought It would be. It's a mix of science, politics and the art of making ethanol, and I really enjoy it. Ethanol production is not like other chemical manufacturing processes: it's not one-plus-one-equals-two all the time. It's not that simple because you're dealing with living micro-organisms. It keeps you on your toes, that's for sure.
 	
 "I have always been a person who liked to get out of the lab. I have a strong background in DDGS - and I'm really tied to it now. Through distillers grains research and marketing efforts, I have met many of the people that I know today in the industry." 
 
 Her vision for the industry
 Kelly said she believes the ethanol industry will continue to grow on the back of rural economic development issues. And that is something she is impassioned about. 
 	
 "I want to see the industry grow with farmer-owned groups, rather than corporate growth and consolidation," she said. "The little guy does not have that big corporate voice. And I enjoy helping them find a louder voice. . . I want to see the ethanol industry grow, but I don't want to see the industry become three huge ethanol producers."
 	
 During her 19 years in ethanol production, Kelly has seen the industry grow from 350 million gallons a year, to more than 2 billion gallons a year. 
 	
 "I think it will grow at an even faster rate in the near future," she said. "But the growth will come in conjunction with marketing the product to the consumer and develop the rural economy at the same time. I also think cellulose to ethanol will take place on a commercial scale if enough money is thrown at it. Corn is king, but things will eventually change. Corn plants will need to be flexible. 
 	
 "The cellulose plants will be strategically located, and the corn plants will be located where there is corn - they will locate away from each other - it's really all too easy.

CVEC Quality Manager has worked in ethanol production for 19 year

Kelly Davis is impassioned about ethanol

The National Corn Growers Association (NCGA) will host a two-day conference, Aug. 21-23, designed as an information session for anyone interested in ethanol coproducts for livestock and poultry. Sessions include nutrition reports, first-hand experiences, future production and market trends of DDGS. Managers and supervisors of ethanol processing facilities responsible for the sale and use of distillers grains will find some of the newest information available regarding nutrition research presented at this conference. Nutritionists and consultants will have the opportunity to discuss consistency and quality of DDGS, as well as question those who have experience using ethanol coproducts.

NCGA will hold North Central DDGS Conference

Brazilian millers are close to creating a 1 billion-liter strategic stock of cane-based ethanol to guarantee supplies, a senior government official said this month. The stock, which would be privately financed, was agreed in principle in May but its launch has been delayed by disagreements over funding and a need for more mills to participate. In 1989, a breakdown of ethanol supplies destroyed Brazilian consumer confidence and led to a collapse in sales of specially designed vehicles, fueled by hydrous alcohol.

Brazil nears ethanol stock launch

The National Corn Growers Association (NCGA) has named Jon Doggett as vice president of public policy. In this position, Doggett will be responsible for administration of trade, farm bill and legislative programs. He will be based in NCGA's Washington, D.C. office. Doggett brings to NCGA a wealth of experience in government relations. Most recently, he was senior director of congressional affairs for the American Farm Bureau Federation (AFBF), where he managed regulatory and legislative projects, including energy, federal lands, land use, natural resources and climate issues. "We're very excited to have Jon join the NCGA staff," said Rick Tolman, NCGA CEO. "He has a strong knowledge of the issues NCGA is committed to—most notably renewable fuels, energy policy and farm policy. Together, his agricultural background and his strengths in grassroots advocacy are assets for this position. No doubt, the organization will benefit from Jon's strong professional working style; he is accomplished at getting things done."

NCGA Names Doggett V.P. of Public Policy

The American Coalition for Renewable Energy, which was formed in May of this year, held its first annual meeting in Washington D.C. this month. The organization's mission is to "bring renewable energy into the mainstream of America's economy and lifestyle." Former CIA Director and ethanol proponent,  R. James Woolsey, spoke at the conference.

American Coalition for Renewable Energy meets in D.C.

Alfa Laval customers can now receive help with heat exchanger, separator and decanter questions from Alfa Laval's newly established Help Desk. Callers speak directly to a member of the technical support staff who is knowledgeable on all products and relevant applications. The technical support staff is qualified to answer questions regarding troubleshooting, maintenance, operation, performance and process information. Should the staff member be unable to answer the question directly, the customer is guaranteed an answer within 48 hours. The Helpdesk is manned standard business hours (8:00 a.m. to 5:30 p.m. EST) five days a week and backed by an emergency service during our non-business hours. Contact the help desk by calling 1-866 ALFA LAVAL (1 866 253-2528).

Ethanol industry supp;ier launches help desk

Work is underway at the Chippewa Valley Ethanol Company (CVEC) on an expansion that will nearly double the plant's production. When it was constructed more than six years ago, CVEC was designed to produce 15 mmgy, consuming 6 million bushels of corn. However, the plant has consistently produced beyond its design capacity. Through improvements to the plant in recent years, its capacity was raised to more than 20 mmgy. Now the plant would like to double its output to 40 million gallons annually. The expansion is reportedly permitted to produce up to 49.5 mmgy. CVEC General Manager Bill Lee has said he would like to see the operation gradually build toward that goal.

CVEC expansion underway

Northern Lights Ethanol, LLC has reportedly come online six weeks ahead of schedule. The grand opening of the 40 mmgy ethanol facility was held late last month with over 1,300 in attendance. The ribbon-cutting ceremony capped a tremendous weekend for ethanol production in the state and for its turnkey plant designer, Broin Companies, which broke ground on James Valley Ethanol, near Groton, S.D., on the same day last month.

Northern Lights Ethanol LLC comes on-line early

South Dakota state officials have issued a permit for Dakota Value Capture Cooperative (DVCC), a combination ethanol plant and cattle feedlot in Sully County north of Pierre. The permit from the state Department of Environment and Natural Resources is the last of nine federal and state permits required for Dakota Value Capture Cooperative to operate, co-op officials said. The proposed $64 million operation would include a 20 mmgy ethanol plant and a 28,000-head cattle feedlot. Odor and manure from the feedlot would be converted into methane to be burned at the ethanol plant.

DVCC receives final permit

Marshall, Minn.-based Minnesota Corn Processors, LLC (MCP) announced this month that it has signed a merger agreement with Archer Daniels Midland Company (ADM). The agreement is structured as a cash-for-stock deal whereby ADM will pay to MCP shareholders a price of $2.90 for each Class A unit upon the closing of the merger. The transaction will be accomplished by MCP merging with a subsidiary of ADM.

 	
 A proxy statement soliciting votes regarding the proposed merger is tentatively scheduled to be mailed out toward the end of July with a shareholder vote in late August. These dates, however, are not yet confirmed.
 	
 "MCP's board of directors have carefully analyzed this transaction and have concluded that this is an attractive offer for our shareholders. The board of directors recommends that the shareholders vote in favor of the transaction," said Jerry Jacoby, chairman of the board of directors of MCP. "ADM has indicated to me that they are looking forward to a long and continuous operation of the corn wet-milling plants." 
 	
 "This proposed transaction represents the recognition of the value created by MCP in the last several years, particularly since the large financial losses in 1996 and 1997," said L. Dan Thompson, MCP president and CEO. "The price of $2.90 per Class A unit represents a very significant premium over the recent market price of the Class A units which have been trading around $1.00. It is very fair from a financial perspective. Liquidity and value are two of the areas that our MCP shareholders have repeatedly asked us to address. This transaction, if approved by the voting members, will answer those two areas of concern." 
 	
 The transaction remains subject to a number of conditions, including approval from MCP shareholders and appropriate regulatory agencies.
 	
 Informational meetings are tentatively scheduled for the week of August 12, 2002 to provide MCP shareholders the opportunity to ask questions regarding the merger. When these dates are finalized, MCP will send out notices of the time, place and date.

Minnesota Corn Processors, ADM reach definitive merger agreement

Archer Daniels Midland Company (ADM), North America's largest ethanol producer, announced this month that it will begin direct marketing of industrial ethanol products for delivery beginning January 1, 2003. The company has supplied industrial ethanol for the past five years through a joint venture with the Dow Chemical Company, formerly Union Carbide Corporation. The companies dissolved a 19-year-old joint venture early this month. 
 	
 Industrial ethanol is used in the following key markets: pharmaceuticals; coatings, inks and adhesives; personal care; disinfectants and insecticides; detergents and cleaners; chemical intermediates and vinegar. 
 	
 "The addition of industrial ethanol will complement our existing portfolio of fuel and beverage products," stated Larry Cunningham, senior vice president of corporate affairs. "We are committed to a leadership position in the total ethanol industry and believe a direct presence in all three of these markets is critical in optimizing our business objectives." 
 	
 The industrial ethanol will be produced at the ADM Peoria, Illinois and Clinton, Iowa corn processing facilities, Cunningham said.

ADM plans to market industrial ethanol products by 2003

The ethanol industry's recent triumphs and failures have shown us there are several ways to build an ethanol plant, but only a few ways to build one right. 

 	
 Contracting an experienced design-build firm and utilizing a proven process-design technology is a step in the right direction, but even a flawless startup does not guarantee success in today's market. "Economy of scale" has become the industry's most popular buzz phrase: "Anything under 40 mmgy won't cut it" some say.
 	
 So why is at least one design-build firm still asserting that 25, 20. . . even 15 mmgy ethanol plants can be good investments?
 	
 "Economy of scale is important for all process plants," said John Nobles, president of Burns & McDonnell's Process & Industrial division. "But probably no one will have Archer Daniels Midland-size economy of scale. And that's why we believe a far greater competitive advantage awaits those who seek out unique opportunities for ethanol plants. Niche synergies can blow away economy of scale."
 	
 According to both Nobles and Burns & McDonnell Process & Industrial division Vice President Rowland Nofsinger, an ethanol project can find competitive advantages in several ways, including: integrating a cattle feedlot that utilizes a substantial amount of wet feed, integration with another chemical plant or bioprocesing plant, cogeneration, or simply applying advanced process technologies (such as improved separations). 
 	
 "More and more, we hear about contractors asking rural investors to build 40-plus mmgy ethanol plants," Nobles said. "And that's great if they can afford it, but these investors cannot always raise that kind of equity. Not everyone has deep pockets, and Burns & McDonnell is willing to work with clients who have set their sights on smaller projects. We can find ways to offset the economy of scale factors."
 	
 An experienced company,Kansas City-based Burns & McDonnell is 104-year-old business that has grown from a two-man operation into an international engineering, architectural, construction, and environmental services firm that employs over 1700 people in offices around the world. The firm acquired the C.W. Nofsinger Co. in 1983, and has been involved in the ethanol industry ever since. 

 	
 Nobles calls the company an "owner's engineer that has grown into an EPC/design-builder."
 	
 Along with ethanol plant design and construction, Burns & McDonnell is involved with an assortment of chemical and agricultural processing projects, power and cogeneration plants, water/wastewater treatment, airport design, and an array of other engineering and construction projects. 
 	
 "The roots of our company is serving communities that needed basic infrastructure such as power, water, and wastewater treatment," Nobles said. "So there is an affinity with what we are doing in the ethanol industry today. Working with rural residents and farm groups so they can control their own destiny is right up our alley." 
 	
 From comprehensive design to construction review, the company has been involved with a number of ethanol projects over the last two decades, including the following: Nebraska Energy (Aurora, Neb.), Chief Ethanol (Hastings, Neb.), Farmland Industries (Aberdeen, S.D.), Williams BioEnergy/formerly Pekin Energy Company (Pekin, Ill.) and several confidential projects including cellulose conversion pilot plants. 
 	
 Currently, Burns & McDonnell is contracted with Central Kansas Renewable Energy (CKRE) LLC to design and build a 25 mmgy plant in Lyons, Kan., utilizing Katzen process technology. The company is also in the early stages of negotiations with another prospective future producer group in Kansas, and two others in Nebraska. 
 
 Capabilities & business approach 
 Burns & McDonnell is a full-service provider that employs hundreds of engineers, technicians, and designers, providing complete ethanol plant engineering and construction services. Whenever possible, the company works with local and regional constructors when building an ethanol facility. Aside from its design-build capabilities, Burns & McDonnell has the resources and experience to conduct studies and business plans, lead the permitting effort, manage environmental compliance, structure business deals, steer equity drives, and assist with electrical, natural gas and water negotiations. 

 	
 "We are a professional service provider to the ethanol industry," Nobles said. "And we can do it all under one roof - along with our design-build project execution."
 	
 Depending on the needs of its clients, Burns & McDonnell utilizes either Katzen International process technology or Vogelbusch process technology, Nobles said. 
 	
 Unlike some of the other top design-build firms in the industry, Burns & McDonnell does not permanently invest its own equity in the ethanol plants it builds. They believe owning ethanol plants while, at the same time, building ethanol plants, presents a conflict of interest down the road. 
 	
 "We do not want to compete with the plants we build," Nobles said. "As soon as I build a plant next door (to a former client), I am competing with them. . . We want our clients to beat their competition, and that competition won't be us."
 	
 But that doesn't mean the company does not have "skin in the game," Nobles said. Burns & McDonnell offers a "guaranteed maximum contract" and operates on an "open book basis."
 	
 "If the price of the project ends up over (the guaranteed maximum contract), we pay for it," Nobles explained. "If it ends up under our price, the client receives the savings. . . For example, if we find an inexpensive piece of equipment, our client saves money."
 	
 Nofsinger explained that Burns & McDonnell encourages clients to spend significant portions of owners' seed capital "judiciously." 

 	
 "Owners seed capital, prior to the major capital fund drive, should be used for feasibility studies, business plans, site selection, permitting and financial assistance in getting a commitment for one or two significant investors," Nofsinger said. "Only a small portion of these funds should be used for preliminary engineering."
 	
 Furthermore, Nobles said, "equity before debt."
 	
 "Leading with equity investment demonstrates the strength of a project's merit as an ongoing business. Acquiring debt is significantly predicated upon the strength of other factors such as securitization of the assets underlying the ongoing business. Leading with equity affords the opportunity to lower the weighed cost of capitol."
 
 What's around the corner? 
 Burns & McDonnell has thrived for a century by being a leader. And it plans to be at the forefront of tomorrow's ethanol/bioprocessing industry. The company's leaders believe strongly in the commercialization of cellulose-to-ethanol technology, and they see Burns & McDonnell as a natural leader in that area. 
 	
 "Cellulosic ethanol technology is not rocket science," Nobles said. "It involves the skill of separation, and our business is separations."
 	
 Nobles said he believes the ethanol industry is rapidly moving toward lower value feedstocks and higher value products. 
 	

 "We believe an ethanol plant is a gateway to a biorefinery," he said. 
 	
 As for the near future, Nofsinger added, "The industry is such that the future is looking very bright in the long term. A renewable fuels standard would propel this industry to a new level, but in the short term, I am concerned about plants that are coming online in the next 8 to 12 months. However, by 2004 - or even sooner - I think the market will be very favorable again. Burns & McDonnell is in a unique position to help the industry prepare for the unprecedented opportunities that awaits it."

Nobles: 'Niche synergies can blow away economy of scale'

Burns & McDonnell not discouraging small-project investors

KAAPA Ethanol, LLC this month began construction on its ethanol plant near Axtell, Neb. KAAPA becomes the second ethanol plant under construction in the state. Nebraska is home to seven existing ethanol plants.
 	
 The KAAPA ethanol plant will process nearly 15 million bushels of corn per year into 40 mmgy and approximately 350,000 tons of distillers wet grains. 
 	
 Fagen, Inc., the Granite Falls, Minnesota design-build contractor, is spearheading the project and incorporating ICM process technology. "Fagen is pleased to have the opportunity to team with the Kearney area farmers to develop and build this state-of-the-art fuel ethanol and feed plant," said Wayne Mitchell, vice president of Fagen, Inc. "The success of KAAPA shows the determination of the farmers-owners to create their own value-added opportunities while at the same time doing their part to reduce America's dependence on imported energy."

KAAPA Ethanol begins work on plant in Nebraska

Williams' corporate offices in Tulsa, Okla., announced the sale of its Pekin, Ill. ethanol plant early this month, which produces ethanol for fuel and beverages and brewers yeast, as well as other corn coproducts. 
 	
 Williams also announced it will sell its Memphis and Alaska refineries and other related petroleum assets. It is estimated the businesses will be sold by the end of this year for more than $1 billion. 
 	
 Through its marketing alliances with producers and its own production facilities, Williams is the second largest ethanol producer in the U.S., distantly behind Archer Daniels Midland (ADM). However, ethanol production still represents a small portion of Williams' overall energy business and is not considered one of the firm's core business areas. 
 	
 A spokesperson for Williams recently said the company would like to close a deal on the Pekin plant by the end of the year.

Williams BioEnergy will sell 100 mmgy Pekin wet-mill

As reported by the Renewable Fuels Association (RFA) this month, ExxonMobil has announced it will switch from MTBE to ethanol in its California gasoline by early next year. ExxonMobil, the world's largest oil company, joins BP and Shell Oil Products in committing to be MTBE free in 2003. Phillips Petroleum already blends more than 80 percent of its gasoline in California with ethanol.
 	
 With ExxonMobil's decision, four (BP, Shell, Phillips, and ExxonMobil) of California's five major refiners will be using ethanol next year. The only remaining major refiner, ChevronTexaco, hasn't made a definitive public statement regarding their timetable for eliminating the use of MTBE in California gasoline. According to 2001 figures from the California State Board of Equalization, BP, Shell, Phillips, and ExxonMobil together account for more than 60 percent of total gasoline sales in California. The switch to ethanol will likely create a market for more than 500 million gallons of ethanol in California next year.

ExxonMobil joins the early switch to ethanol in Calif.

Alltech Inc., a Nicholasville, Ky.-based biotechnology company, has opened a new production and research center in Springfield, Ky., and plans to eventually build a biorefinery capable of producing a number of products from natural resources. The facility would be used to process corn, wheat and other grains into soy-based diesel and ethanol. 

 	
 "Implementing the biorefinery concept would put Kentucky at the forefront of a new era of agriculture-based technology that ensure a future for many in the agriculture industry," Alltech president Pearse Lyons, said. "We are committed to bringing this concept to reality for the benefit of the state's farmers and economy." 
 
 Alltech announces exclusive relationship with Ingledew
 In other Alltech company news, the company announced this month that it has forged an exclusive relationship with renowned research scientist, and consultant to the ethanol industry, Dr. Mike Ingledew, of the University of Saskatchewan. Ingledew will oversee numerous research areas for Alltech and provide technical support to the company, according to a company statement released in mid-July.

Alltech planning to build biorefinery in Springfield

Consulting engineering firm Harris Group Inc. has signed a two-year contract with U.S. Department of Energy's National Renewable Energy Laboratory to provide process development engineering for its biomass ethanol program. The project's goal is to optimize the process for turning biomass - agricultural residue, wood waste, and even municipal solid waste - into ethanol. 
 	
 The two-year contract asks Harris Group to provide objective analysis and creative input on NREL's biomass ethanol process. According to Carol Babb, vice president of Harris Group's process development team, the possibilities for biomass conversion to ethanol are extensive. 
 	
 NREL's Kelly Ibsen, process engineering team leader, said Harris Group was selected based on several criteria including its experience with equipment testing and selection for biomass conversion and emission issues. "NREL is pleased to be working with Harris Group. They have a demonstrated track record in providing objective and industry-proven ideas that improve the commercial viability of our biomass conversion process designs."

Harris Group gets biomass ethanol work with NREL

A company spokesperson for Praj, an international ethanol technology provider, says the company has "bagged an order amidst stiff international competition" from Australian Biofuels Pty Limited. 
 	
 The ethanol plant will be located in Queensland, a sugarcane rich state in Australia. This will be the first ethanol plant to be set up in Australia since the announcement of the naiton's new Fuel Ethanol Program. 
 	
 The order includes licence for technology, engineering and plant for production of 40 million liters per year using cane molasses as a feedstock. The plant design is such that it will enable addition of modules for alternate feedstocks. 
 	
 The plant includes Praj's continuous fermentation system, as well as its evaporation plant and dehydration plant. 
 

 Delta-T Technology
 The fuel ethanol technology is based on Molecular Sieve Dehydration system under licence from Delta T Corpn. Australia will require 350 million liters of fuel ethanol by the Year 2010. The program has stipulated t

July 2002

Business Briefs

North Dakota Governor working hard for ethanol

Columns

The Way I See IT

Featured

Over 1000 attend International Fuel Ethanol Workshop in Springfield, Ill.

Kelly Davis is impassioned about ethanol

Burns & McDonnell not discouraging small-project investors

July 2002.css-7jxktu{position:absolute;bottom:0px;left:0px;right:0px;height:3px;border-radius:3px;background-color:var(--chakra-colors-brandBlack);}

Business Briefs

North Dakota Governor working hard for ethanol

Columns

The Way I See IT

Featured

Over 1000 attend International Fuel Ethanol Workshop in Springfield, Ill.

Kelly Davis is impassioned about ethanol

Burns & McDonnell not discouraging small-project investors

July 2002