BlueFire Renewables signs fixed-price EPC contract on heels of feedstock, offtake deals
In California, BlueFire Renewables announced that it has finalized and signed an Engineering, Procurement and Construction (EPC) contract for its cellulosic ethanol project in Fulton, MS. The facility will be engineered and built by Wanzek Construction, Inc., a wholly owned subsidiary of MasTec, Inc. (MTZ) , for a fixed price of $296 million which includes an approximately $100 million biomass power plant as part of the facility.
The contract is negotiated in a manner to be appealing for non-recourse project bank financing and, more importantly, serves as the final key project contract agreement to move forward with both the DOE and USDA Loan Guarantee Programs.
In the past three weeks, BlueFire had also announced the securing of 15-year offtake and feedstock contracts with credit worthy partners, and has thereby become the first advanced biofuels company to secure all three legs of the requirements generally associated with DOE loan guarantees. Though authorized since 2005 to issue loan guarantees for advanced biofuels technologies, the DOE has yet to issue one.
“Having recently announced off-take and feedstock agreements for our Fulton, MS. plant, BlueFire Renewables has now satisfied all stated requirements to move forward on an agreement with either the DOE or USDA for a loan guarantee to complete financing of the project,” stated Arnold Klann, CEO of BlueFire Renewables, Inc. “BlueFire now stands poised to finalize the government negotiations and affect the financing and construction of this commercial-sized cellulosic ethanol plant.”
Klann noted the low number of DOE loan guarantees, but is optimistic that his project will qualify. “We have achieved the near-impossible, and provided, over the past eight weeks a degree of financial stability [for the project] that any lender can get his arms around. Obama is saying ‘we need energy security, we need to get these plants built.’ Jonathan Silver [DOE director of loan programs] needs to clarify to the industry – do they want them built, or is this about providing a method of financing on the same terms as any commercial bank would provide?”
BlueFire is working with both the USDA and DOE loan programs, and over the past three years has secured $88 million in DOE grants. The company was established to commercially deploy the Arkenol Concentrated Acid Hydrolysis Technology Process for the profitable conversion of cellulosic waste materials into cellulosic ethanol, biodiesel, biojet fuel, and drop-in hydrocarbon fuels.
The influential Mas family, which founded MasTec and produced the current chairman, Jorge Mas, and the CEO, Jose Mas, are strong political backers of former DOE Director of the Office of Minority Impact, Joe Garcia, who resigned his position earlier this year to run for Congress.
“BlueFire’s proprietary technologies, which convert non-food cellulosic waste into fuel, should bring environmentally friendly facilities and increased long-term employment to the State of Mississippi. We are glad to be a part of the initial roll-out and we look forward to working with BlueFire on a number of other opportunities”, noted Jose Mas, MasTec, Inc’s Chief Executive Officer.
The Fulton, MS project will allow BlueFire to utilize green and wood wastes available in the region as feedstock for the ethanol plant that is designed to produce approximately 19-million gallons of ethanol per year.
BlueFire is the only cellulose-to-fuel company worldwide with demonstrated production of Biofuels from urban trash (post-sorted MSW), rice and wheat straws, wood waste and other agricultural residues.
Category: Fuels
