Ethanol dehydration facility to be built in Trinidad

EthylChem Inc. has begun construction of an ethanol dehydration operation at the Petrotrin Refinery in Point-a-Pierre, a southern port city in Trinidad. EthylChem, a company that was formed in Trinidad specifically for the purpose of installing and operating an ethanol dehydration plant there, plans to import the dehydrated ethanol to the United States under the Caribbean Basin Initiative (CBI).

The plant will dehydrate ethanol at a capacity of 100 MMgy. It is expected to be complete between March and April 2007, said Ron White, executive director. "I would like it to be March because I would like to be in there for the full driving season," he said, referring to the summer months in which fuel sales are higher because of increased vacation activity.

The hydrous ethanol—feedstock for an ethanol dehydration plant—is produced from sugarcane in Brazil and contains about 6 percent to 7 percent water. It is then shipped to Trinidad, where the water is removed through a molecular sieve. Then, the anhydrous ethanol is shipped to the United States, where it is exempt from import tariffs, as detailed in the CBI. "The U.S. Customs and Border Protection even issued a ruling around last year in July that reinforced the qualifications of those CBI plants," White said. The hydrous ethanol is under contract with Brazilian suppliers, but White wouldn't reveal the identity of these companies.

This type of operation has been the center of controversy in past years. "The controversy revolves around politics," White said. "There are some congressmen from corn-producing states in the U.S. that would very much like to see imports of ethanol restricted—as a protectionist approach for domestic production." Sen. Chuck Grassley, R-Iowa, has been one of those congressmen leading the charge to restrict or prohibit imported ethanol. "Largely, his efforts have been unsuccessful," White said.

In June, the U.S. ethanol industry was producing about 318,000 barrels per day when demand was about 395,000 barrels per day, according to the U.S. Energy Information Administration. White said imports made up the difference during this time, and there were only a few problems because of a lack of ethanol. "What the American public needs to realize is that imports saved the day for the ethanol industry this summer when the rapid increase in U.S. consumption occurred because of MTBE being removed from the gasoline pool," White said. "If it hadn't been for imports, the U.S. industry would have been in a world of hurt."