BlueFire Ethanol, Inc. (PINKSHEETS: BFRE) has been awarded up to
$40 million from the U.S. Department of Energy's (DOE) cellulosic
ethanol grant program to develop a solid waste biorefinery project
at a landfill in Southern California.
"These biorefineries will play a critical role in helping to bring
cellulosic ethanol to market, teaching us how to produce it in a
more cost effective manner," Secretary Bodman said. "Ultimately,
success in producing affordable cellulosic ethanol could be the key
to eliminating our nation's addiction to oil. By relying on
American ingenuity for fuel, we will enhance our nation's energy
and economic security."
The Southern California Biorefinery Project will turn green waste
and wood residues at landfills into about 19 million gallons of
fuel grade ethanol per year. Additional products that will also be
sold include lignin, gypsum, and yeast. BlueFires's current
production estimates for the project will be significantly lower
that DOE's cellulosic ethanol goal of $1.07/gal in production costs
by 2012, and DOEs current estimate of approximately
$2.26/gal.
Klann added BlueFire will help DOE accelerate its goals for the
cellulosic ethanol industry with the successful completion of its
project.
"This is an important milestone for BlueFire Ethanol and a
significant opportunity to demonstrate the use of new energy
supplies in our landfills," he added. "Our biorefinery will enable
us to be located directly in the markets with the highest demand
for ethanol while helping cities to manage landfill waste."
Construction is expected to begin by the end of this year with
start-up expected on or before the end of 2009. BlueFire's process
could be repeated at most of the more than 1,600 landfill sites
across the nation. Because it captures the more potent greenhouse
gas methane as part of its process as well as provide renewable
fuel, BlueFire will reduce greenhouse gases that cause global
warming.
All of the ethanol produced will be sold under the terms of a
long-term contract with Petro-Diamond, Inc., a wholly owned
Mitsubishi Corp. subsidiary. Colmac Energy will purchase all of the
lignin produced for use as boiler fuel for its biomass power plant
located in Riverside County. The gypsum will be sold to local
landscape wholesalers and the yeast will be sold as an animal feed
supplement.
In February 2006, DOE announced a $160 million grant program that
would provide cost-share funding over four years to build up to
three U.S. biorefineries. The program's goal is to demonstrate that
commercial biorefineries can be profitable once initial
construction costs are paid. Projects are required to show a 60/40
(industry/government) cost share.
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