Idled ethanol plant for sale in Pratt, Kan.

By Holly Jessen | August 27, 2010
Posted Aug. 31, 2010

Between now and Sept. 24, interested buyers can bid on a 55 MMgy ethanol plant in Kansas. But if a good offer comes in before Sept. 24, the new owners reserve the right to take it. "The bids are being considered as received," said Kirk Martin, managing partner of Ascendant Partners, a business and financial advisory firm that is working with the owners to find buyers for the plant.

Gateway Ethanol cost $100 million to build and started producing ethanol in October 2007. The plant shut down once for repairs after storm damage and again after working capital ran short. In October 2008 the company filed for bankruptcy.

The new owners are a bank group made up of the original lenders and other banks that aren't interested in operating the plant themselves. The group took possession of the plant and its related assets on June 30, which for legal purposes is now called Gateway Plant. Gateway Ethanol, on the other hand, is still working to resolve the bankruptcy issue.

The ethanol plant has been maintained in the more than two years it has been idle. A small staff has kept it clean, turned valves and drained fluids in an effort to keep it ready for resumed operations. "It has been maintained on a 24-7 basis, during the period it was idle," Martin said. In addition, the county taxes and monthly water payments have been paid and the facility's permits have been kept updated.

The ethanol plant has a nameplate capacity of 55 MMgy and will process 20 million bushels of corn and sorghum into ethanol, 160,000 tons of dried distillers grains and 140,000 tons of CO2. There are a number of oil and gas fields located near the plant that have an interest in using CO2 from the facility for enhanced oil recovery.

The plant sits on 363 acres of land and has another 259 acres located adjacent to the facility. A Union Pacific main line railroad runs past the plant. For more information, see www.gatewayethanol.com or contact Ascendant Partners.