Poet completes purchase of 27th ethanol plant

By Holly Jessen | June 10, 2010
Posted June 30, 2010

Poet LLC is adding to its total production capacity with the purchase of a 90 MMgy ethanol plant. The Cloverdale, Ind., plant, previously operated by Altra Biofuels, will reopen after Poet installs new processes and technology.

"This will be our 27th production facility overall," Jeff Broin, CEO of Poet said in a press call. "In total, POET will have the capacity to produce 1.7 billion gallons of ethanol and more than 4.5 million tons of dried distillers grains. We will continue to look for opportunities to expand that capacity."

Construction and the permitting process at the Cloverdale plant will start right away. The company plans to install its proprietary process technology and improve the overall plant design. The upgrades, which will cost approximately $30 million, will include Poet's patent-pending fermentation process that reduces energy use by 10 to 15 percent by using enzymes instead of heat. Water recovery to recycle wastewater and a pollution control system will also be installed. "If everything goes smoothly," Broin said, "the plant will be operational in 9 months and able to produce 90 million gallons of ethanol per year."

The plant, which operated for a short time in 2008, opened during a difficult financial time for the industry, the company said. In addition, the plant's emissions were reportedly in excess of its permits due to design flaws, something Poet will correct before restarting production. "In the long term," Broin added, "the vast amount of ag residue in the area makes this plant an excellent candidate for cellulosic ethanol production, which is a technology our company is working on today."

In all, Poet plans to hire between 40 and 45 employees, with annual payroll and benefits of more than $2 million. The first step will be to hire a general manager, who will lead the rest of the hiring process. Although several positions will be filled immediately, the bulk of the jobs will open up closer to start up. In the past, Poet has filled more than 90 percent of jobs at a plant with local residents, the company said.

Those jobs mean a lot to Indiana residents, said Indiana Lt. Gov. Becky Skillman. "We're glad that POET is making another commitment to Indiana and its workers," she said. "These new jobs and the use of this existing facility will be a tremendous boost for Putnam County." Once operating, the Cloverdale plant will be Poet's fourth in the state.

The plant, which is served by CSX rail, will use 31 million bushels of corn a year and produce 246,500 tons of Poet's Dakota Gold Brand distillers grains. This is a great time to bring new production online, Broin said, adding that the company had been looking at acquiring more ethanol plants for some time and will continue to do so. "U.S. farmers in 2009 proved once again that we can responsibly feed and fuel our world, with record production and record yields," he said. "Today, if there is an agricultural crisis, it is figuring out what to do with these record surpluses."