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Monday, Mar. 2, 2015

US Bio offers tours ethanol tour

Tuesday, April 12, 2005

Higher oil prices make for timely ethanol opportunity

US BioEnergy, which plans a $125-million ethanol plant with a 100-million-gallon-a-year capacity on the southeast edge of Albert City, sponsored a tour Monday of the Little Sioux Corn Processors ethanol plant near Marcus.

The purpose of the tour was to acquaint Buena Vista County residents with the ethanol process and the involvement of US Bio and Fagen Management LLC, a partner in US Bio.

The main similarity between the Albert City and Marcus plants is the involvement of Fagen Management LLC. Fagen built the $59-million, 40-million-gallon Marcus plant, and the Little Sioux Corn Processors Board of Directors hired staff to operate it.

As for the 100-million gallon Albert City plant, Fagen has partnered with US Bio as plant builder and owner.

Those giving the tour included US Bio Director of Communications Kristi Lee, Kathleen Showalter of PlanScape Partners, and Fagen Management LLC General Manager Steve Core who is currently in Marcus constructing an upgrade of the Little Sioux plant.

The Albert City plant is the first to be built by US Bio which has partnered with Fagen Management, the largest producer of ethanol plants in the U.S. Showalter said US Bio also plans a 100-million-gallon plant near Janesville, Minn. She said the Iowa Department of Economic Development will review US Bio's application for the New Jobs Incentive Program at its Thursday, April 21 meeting.

Lee said the Janesville plant will have the same configuration as the Albert City plant. She said there are also plans for another US Bio plant in Michigan with the company slating 1 billion gallons a year in production in five years.

It was at the Little Sioux facility where Core offered an in-depth explanation of the ethanol process.

Core said half of the Little Sioux plant's long-term debt is paid, with the plant recently completed in 2003. "This has been a real good plant for us," Core said.

Core said the plant, designed for 40-million gallons of production a year, is running slightly over 50 million gallons a year and that is why Fagen is now on site to expand the facility for a $7 million upgrade.

Core said the Little Sioux plant buys corn on the open market. Corn is in fact the major cost of running an ethanol plant, with natural gas coming second. Core said the Albert City ethanol plant will use 200 times the natural gas as the entire town of Albert City.

The ethanol-manufacturing process is basically the same as the process of manufacturing whiskey. The starch from corn is turned to sugar then alcohol while pH, acetic acid, lactic acid, and bacteria levels are monitored. Excess bacteria levels can result in lower alcohol levels.

"This plant (Marcus) has a perfect record of never having had a bacterial infection," Core said. Anhydrous ammonia and urea are also used in the process. "It's a living, breathing organism," Core said.

By monitoring bacteria levels and other possible problem areas of ethanol production, the plant can prevent downtime. That's particularly significant given the fact that in February the Marcus plant made $3,000 an hour.

Once 190 proof alcohol is made, the ethanol is run through a sieve bottle that removes water but not alcohol, making pure, 200 proof alcohol. The ethanol is denatured with gasoline, a requirement of the ATF which licenses every ethanol plant.

Byproducts include wet and dry distiller grains, with wet grains comprising about 70 percent of coproduct. Wet grains are used for feeder and dairy cattle and dry grains are used for dairy, swine, and poultry feeding. Nebraska is the primary market for wet grains.

Core said 75 railcars of ethanol go by rail to New York every 10 days where it is blended with gasoline. "In theory, we can make it in eight days but we're going to try to do it in 10," Core said.

It takes 14-16 hours to load the cars and six hours for unloading. Core said ADM (Archer-Daniels-Midland) is the exclusive marketer for the Little Sioux plant.

The economic advantages of ethanol are more clear today than ever, with higher gas prices. Core said with the spot market for ethanol market is $1.10 to $1.15 a gallon, making the price of E-85 $1.69 a gallon.

Showalter praised the Albert City contingent, the largest percentage of about 30 taking the tour, for helping to bring the US Bio plant to their community.

"Albert City stepped to the plate and influenced our county supervisors to see what a wonderful project this is," Showalter said. "This is a great team to work with. You will love having them in your community."



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