US awards Coskata $250 mln biofuel loan guarantee

The U.S. Department of Agriculture (USDA) and the Department of Energy (DOE) granted four separate loan guarantees totaling $646 million to four biofuel projects.

USDA offered the largest amount--$250 million--to support a commercial biorefinery that will utilize Coskata’s cellulosic ethanol technology.

The guarantee will allow developers to move forward with financing the construction of a 55 million gallon per year cellulosic ethanol facility in Greene County, Alabama.

The facility is currently the largest planned cellulosic ethanol facility in the country and is expected to bring approximately 300 construction jobs and 700 direct and indirect sustainable jobs to Alabama.

Coskata is privately held, and to date has been funded entirely by its equity investors, including Khosla Ventures, Blackstone Cleantech Ventures and the Blackstone Group, Advanced Technology Ventures, GreatPoint Ventures, Total Energy Ventures International--part of Total (TOT.PA), one of the world’s major Oil and Gas groups--, Coghill Capital Management, General Motors (NYSE: GM), and Globespan Capital Partners.

Other USDA Awards

USDA also offered $80 million to a 10 million gallon Enerkem cellulosic ethanol project in Pontotoc, Mississippi. Waste Management, Inc. (NYSE:WM) is among the investors in Enerkem.

USDA also confirmed a $75 million loan guarantee offe to Ineos Bio for an 8 million gallon (and 6-megawatts) cellulosic ethanol project in Vero Beach, Florida. The company leaked the announcement earlier this month.

DOE Invests Big in Biodiesel

DOE offered a conditional commitment to Diamond Green Diesel, LLC, the proposed joint venture between Valero Energy Corporation (NYSE: VLO) and Darling International Inc. (NYSE: DAR), for a $241 million loan guarantee to support construction of a 137-million gallon per year renewable diesel facility in Norco, Louisiana.

Valero Energy Corporation plans to direct the design, construction and operation of the project and market all of its output, while Darling International Inc. will supply feedstock to the project.

The companies estimate that the project will create 700 jobs during peak construction and over 60 renewable energy jobs during operation. The project will reduce greenhouse gases by more than 80% over conventional petroleum-based diesel and is expected to nearly triple the amount of renewable diesel produced in the U.S. In addition, the facility will fulfill almost 14% of a national mandate to boost production for biomass-based diesel.

The refinery will produce renewable diesel fuel primarily from animal fats, used cooking oil and other waste grease streams. The project will be the first application of its kind in the U.S. to use an innovative hydrotreating/isomerization process from Universal Oil Products (UOP), known as EcofiningTM, and a pretreatment process from Desmet Ballestra Group, which converts processed feedstock into high-quality diesel.

source: sustainablebusiness