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Company plans to buy 200 acres for ethanol plant
Financing needed to pay for projectremains big question
By PETER WILLIAMS
Managing Editor
A company with plans to build an ethanol plant in Beaufort County expects to buy 200 acres near Aurora by May although the money to build the facility has not been secured, Beaufort County’s top economic developer said Friday.
Tom Thompson wouldn’t disclose the name of the company nor the estimated cost of the property investment. The original cost to build the first plant proposed for a site near Aurora was estimated at $100 million, but proposals have been floated that would double that plant’s production capability and raise the cost to build the plant to $200 million.
Talk of constructing an ethanol plant in Beaufort County has been ongoing since at least 2005, but financing such a project has been an issue since that talk began. The plant would convert corn or other products into a liquid that could be blended with gasoline, with the goals of decreasing pollution and reducing the amount of oil the United States imports.
“As far as I know, they don’t have the financing in place, but they have decided to go ahead and take the property down (off the market), and that should happen in the near future,” Thompson said.
Asked for a more specific date, Thompson said, “May.”
If the 200 acres are sold and not developed, there are other sites in the same area — and some on the north side of the Pamlico River — that could support an ethanol plant. The original plan for an ethanol plant in the county involved the creation of 65 jobs.
“I’ve been meeting with a company from another state and one from Wisconsin who are interested,” Thompson said. “I’m meeting with people all the time, but the chemistry hasn’t been right. There was nothing that we did wrong, and there was nothing we could have done that we didn’t, but the devil is in the details.”
So far, the only thing Beaufort County has invested in the ethanol plant is “my time,” Thompson said.
“There have been no grant monies extended,” County Manager Paul Spruill said Thursday. “I know of no public dollars that have been spent.”
There was a proposal that would have provided the company some of the needed money up front, and those moneys would have been recouped within four or five years from the additional taxes the plant would generate. Because the plant was never built, the county never advanced the money. The state also had offered to help pay for a rail spur, but since the project never moved forward, the money was never used, Department of Commerce officials confirmed this week.
“It’s not dead,” Spruill said of the ethanol-plant concept, “It’s still working its way slowly.”
A number of plants has been proposed, but so far only one, in Hoke County, has broken ground.
“North Carolina is one of those classic cases where we’ve been so close to getting an ethanol plant many times,” said Larry Shirley, director of the State Energy Office.
When the first ethanol plant was considered, banks were willing to finance 60 percent to 70 percent of its construction cost, Thompson said. Now, investors will have to put up half of the money.
Thompson is convinced that an ethanol plant is needed and Aurora would be a perfect site for it because it has barge access to the Pamlico River and a rail line nearby.
Thompson believes that ethanol’s biggest advantage is not that it will eliminate the need for foreign oil imports, but that it can be used to replace MTBE, a gasoline additive used to replace lead.
“It’s important that the public understands that ethanol is not a supplement for oil, but it can replace MTBEs,” Thompson said. “MTBE is a horrible contaminator of groundwater. They put it in gas instead of lead to make engines run smoother and more efficiently and to reduce air pollution, and it did all that, but it created its own problems.
“New Hampshire did a study and found that every lake there was contaminated with MTBEs. It does a great job of reducing air emissions, but it never goes away. Ethanol is the only logical replacement for MTBEs.”
“Aurora is an extremely logical location to put an ethanol plant. ... The problem is companies that were looking at it were never able to get the financing,” Thompson said.
Financing for the original 54-million gallon a year plan was in place, Thompson said.
“Then an investor came in and said ‘Let’s double the capacity,’ and they stopped what they were doing to redesign the plant,” Thompson said.
In the months that followed, costs soared and banks became less inclined to invest in the industry, and the new investor backed out.
“They lost their financing for the first part, so the next logical thing was to try and find some additional investors. I think they were sincere about building the plant, but when it will happen, I don’t know. I can tell you we’re not whistling ‘Dixie.’ There is a compelling reason to build a plant in Aurora,” Thompson said.
By PETER WILLIAMS
Managing Editor
A company with plans to build an ethanol plant in Beaufort County expects to buy 200 acres near Aurora by May although the money to build the facility has not been secured, Beaufort County’s top economic developer said Friday.
Tom Thompson wouldn’t disclose the name of the company nor the estimated cost of the property investment. The original cost to build the first plant proposed for a site near Aurora was estimated at $100 million, but proposals have been floated that would double that plant’s production capability and raise the cost to build the plant to $200 million.
Talk of constructing an ethanol plant in Beaufort County has been ongoing since at least 2005, but financing such a project has been an issue since that talk began. The plant would convert corn or other products into a liquid that could be blended with gasoline, with the goals of decreasing pollution and reducing the amount of oil the United States imports.
“As far as I know, they don’t have the financing in place, but they have decided to go ahead and take the property down (off the market), and that should happen in the near future,” Thompson said.
Asked for a more specific date, Thompson said, “May.”
If the 200 acres are sold and not developed, there are other sites in the same area — and some on the north side of the Pamlico River — that could support an ethanol plant. The original plan for an ethanol plant in the county involved the creation of 65 jobs.
“I’ve been meeting with a company from another state and one from Wisconsin who are interested,” Thompson said. “I’m meeting with people all the time, but the chemistry hasn’t been right. There was nothing that we did wrong, and there was nothing we could have done that we didn’t, but the devil is in the details.”
So far, the only thing Beaufort County has invested in the ethanol plant is “my time,” Thompson said.
“There have been no grant monies extended,” County Manager Paul Spruill said Thursday. “I know of no public dollars that have been spent.”
There was a proposal that would have provided the company some of the needed money up front, and those moneys would have been recouped within four or five years from the additional taxes the plant would generate. Because the plant was never built, the county never advanced the money. The state also had offered to help pay for a rail spur, but since the project never moved forward, the money was never used, Department of Commerce officials confirmed this week.
“It’s not dead,” Spruill said of the ethanol-plant concept, “It’s still working its way slowly.”
A number of plants has been proposed, but so far only one, in Hoke County, has broken ground.
“North Carolina is one of those classic cases where we’ve been so close to getting an ethanol plant many times,” said Larry Shirley, director of the State Energy Office.
When the first ethanol plant was considered, banks were willing to finance 60 percent to 70 percent of its construction cost, Thompson said. Now, investors will have to put up half of the money.
Thompson is convinced that an ethanol plant is needed and Aurora would be a perfect site for it because it has barge access to the Pamlico River and a rail line nearby.
Thompson believes that ethanol’s biggest advantage is not that it will eliminate the need for foreign oil imports, but that it can be used to replace MTBE, a gasoline additive used to replace lead.
“It’s important that the public understands that ethanol is not a supplement for oil, but it can replace MTBEs,” Thompson said. “MTBE is a horrible contaminator of groundwater. They put it in gas instead of lead to make engines run smoother and more efficiently and to reduce air pollution, and it did all that, but it created its own problems.
“New Hampshire did a study and found that every lake there was contaminated with MTBEs. It does a great job of reducing air emissions, but it never goes away. Ethanol is the only logical replacement for MTBEs.”
“Aurora is an extremely logical location to put an ethanol plant. ... The problem is companies that were looking at it were never able to get the financing,” Thompson said.
Financing for the original 54-million gallon a year plan was in place, Thompson said.
“Then an investor came in and said ‘Let’s double the capacity,’ and they stopped what they were doing to redesign the plant,” Thompson said.
In the months that followed, costs soared and banks became less inclined to invest in the industry, and the new investor backed out.
“They lost their financing for the first part, so the next logical thing was to try and find some additional investors. I think they were sincere about building the plant, but when it will happen, I don’t know. I can tell you we’re not whistling ‘Dixie.’ There is a compelling reason to build a plant in Aurora,” Thompson said.
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tunne rat wrote on Jul 6, 2009 8:55 PM:
that is the biggest propganda word that every came out of butterfields and rino jones mouth in the past hundred years .
just 2 water boys for the obama socalist party , and a hand full of red necks that dont have a clue about whast they are talking about . "