Valero reveals plans for Hartley, IA ethanol plant

HARTLEY, Iowa (KTIV) - Just 18-months after ground was broken, and just eight weeks after Hartley, Iowa's ethanol plant started producing the corn-based fuel, the company behind the project filed for bankruptcy.

VeraSun later sold the Hartley plant, and six others, to Valero Renewables, which is North America's largest independent oil and gas refiner, but until now the future of the Hartley plant has been anything but certain. Now company officials with Valero says the plant will stay open and operate at capacity.

"A financially strong company like Valero is able to come in during a downturn pick up assets when they're at very low valuations," said Valero Spokesman Bill Day.

Day says they purchased the plants for 30-percent of their replacement cost. The plants will supply Valero with half of its ethanol needs.

At a time when some businesses aren't doing well during the economic downturn, Valero is looking to grow.

They'll do that by establishing good working relationships with the locals. Valero has already signed contracts with 85-percent of farmers and producers who had contracts with Vera Sun. Those contracts became void when Vera Sun filed for bankruptcy.

"For the poeple who had contracts and that were above market value prices, Valero is offering a contract with market price plus forty-percent of the difference," said Day.

Those with Valero say it's in their best interest to work with local farmers and producers because they're the suppliers of the corn they need. In turn, Valero provides jobs. A "win-win-situation" for the company.

"So we believe these plants will be viable for the long term. This is a long term play for Valero," said Day.

source: ktiv