Ethanol plant clears major hurdle with land purchase
04/14/2005
BY MICHAEL-ALLAN MARION
EXPOSITOR STAFF / BRANTFORD
A farmer-led co-operative is proceeding with its plan to buy a 48-acre parcel of land in the Oak Park North business park for its $86-million ethanol plant.
The integrated Grain Processors Co-operative Inc., has waived 12 conditions on its $2-million land purchase from King and Benton Development Corp., the owner of the private industrial park along Oak Park Road, north of Highway 403.
Many of the conditions had to do with approvals and technical matters surrounding a severance of the land, which allowed the co-op to take water from an aquifer rather than be connected to city services.
IGPC has received a water-taking permit from the Ministry of the Environment after conducting peer-reviewed tests of the aquifer’s capacity, which showed if could support the drawing of up to1,400 litres of water per minute from one to three aquifers passing through the area.
With all hurdles and conditions cleared, the co-op will pay the outstanding $1.7 million in the land purchase, which is set to close May 31.
“We appreciate King & Benton’s on-going support of our community ethonal project and look forward to being the cornerstone of their Oak Park development,” said Joe Kloepfer, IGPC’s treasurer and chairman of the land committee.
About a month ago, the co-op was briefly asked to consider an alternative site a few kilometers away on the Brant County owned Sharp lands where, with the assistance of King & Benton, it could take water directly from the Grand River.
FEDERAL FUNDING
But that alternative was rejected by the board of directors, Mary Jane Combe, IGPC’s project co-ordinator, said Tuesday.
“We had put a great deal of time, effort and money into the Oak Park site and it wasn’t feasible to move,” she said.
Meanwhile, IGPC has applied to the second round of the federal government’s ethanol expansion program, which extends capital loans on generous repayment terms, to add to its nearly $20 million in equity raised in its last report.
The co-op is currently in a four-to six-week waiting period before it heard from Ottawa.
It will have 120 days to negotiate and finalize the loan. That gives a window of about five months.
The amount of financing IGPC has requested is confidential because the negotiations are subject to a bidding process in which the program extends loans to the most competitive projects.
Combe pointed out that ventures in the first round last year received between $2 million and $22 million.
She also explained that IGPC’s business plan is based on not receiving support from the program.
“To get it would be a nice bonus,” she said. “It would speed up the construction process.”
IGPC, with 475 members from the Brant County area farming sector and community groups, plans to build a plant that annually uses 11.8 million bushels of corn to produce 125 million litres of fuel ethanol, about 96,000 tonnes of distillers grain for livestock feed and 60,000 tonnes of carbon dioxide.
IT would generate 150 construction jobs, up to 35 high-paying jobs and $75 million in annual revenue.
Once a shovel is put into the ground, the co-op wants to have the plant built in 12 to 14 months.
The venture has the backing of Agriculture Ministers Steve Peters.
