ICM, Poet, Crescent Oil form NewGen Fuel

By Bryan Sims | January 12, 2009
Web exclusive posted Feb. 2, 2009, at 10:44 a.m. CST

Leading ethanol plant designing and engineering firm ICM Inc., along with the country's largest ethanol producer Poet LLC and wholesale fuel distributor Crescent Oil Co., have created a joint venture entity called NewGen Fuel.

NewGen Fuel will install blender pumps at 1,000 retail gasoline stations across the country through affiliations with other oil industry energy leaders. By installing the blender pumps, NewGen Fuel will provide consumers increased availability of mid-level blends (such as E20 or E30) to high ethanol blends (such as E85) for flexible fuel vehicles (FFVs). The initiative is also aimed at stimulating renewable fuel infrastructure development, create jobs and generate much-needed tax revenue to finance essential public needs.

"We think the timing is real good to do this even with ethanol selling at a premium to gasoline," said Alan Goodnight, NewGen Fuels president and marketing director for ICM. "We think those commodities will swap back once oil gets above $65 [per barrel] again. There's not much paying at the pump, however once oil goes back up we hope to have enough of these stations in place at that point to where consumers will see E20 is a dime cheaper than unleaded [gasoline]."

NewGen Fuel's initiative has already begun in Kansas. In early January, a retail gas station in Coffeyville, Kan., became the first to use the pumps offered by NewGen Fuel.

Each station will consist of six blender pumps containing various ethanol blends, according to Goodnight. An E10 blend isn't labeled on Kansas pumps as it's a standard blend of unleaded gasoline in the state. On Jan. 28, a grand opening was held for NewGen Fuel's second blender pump at a retail gas station in Topeka under the canopy of a ConocoPhillips sign. Goodnight was joined by Kansas Lt. Gov. Mark Parkinson, Kansas Department of Agriculture Secretary Adrian Polansky and Crescent Oil Corp. President Phil Near at the Topeka grand opening.

A third NewGen Fuel blender pump grand opening is slated to take place at a retail station in Wichita in early February.

"This is the first blender pump initiative in the country where a major oil brand has cooperated with us that allows us to install blender pumps and sell mid-level ethanol blends under the brand of a major oil company," Goodnight said.

However, he stressed that major oil refiners are in no way exclusively participating in NewGen Fuel's retail blender pump initiative or are they endorsing mid-level ethanol blends.

"Of the 300 plus locations where Crescent Oil supplies their gasoline, they do so under an agreement with major oil companies," Goodnight said. "So, just because the sign at the corner says [for example] ConocoPhillips, it doesn't mean ConocoPhillips owns or operates that station. It's kind of like a franchise deal."

This is ICM's second venture relating to blender-pump stations. In partnership with the Ethanol Promotion and Information Council, ICM provides ethanol to an independent station in Colwich, Kan., which opened in August 2008.