Canton, IL Ethanol Plant Goes Bankrupt

 

ethanol.jpegThe strange part of this story is, the plant never went into operation. As a matter of fact, it’s still under construction. Farmers who invested in the project have lost their money since the Chapter 11 filing creates a federal injunction prohibiting creditors from taking action against the company, Central Illinois Energy.

It’s taken five years to get the operation to this point, but the main contractor, Lurgi PSI, left the job site and cancelled all contracts on the grounds it wasn’t being paid. The Fulton County Clerk’s Office says more than $30 million in liens have been filed for unpaid invoices by contractors.

Attorney Barry Barash of Galesburg, IL, who is overseeing the bankruptcy, said there were several factors that lead to the action. Re-engineering costs affecting the contractor have been suggested, and the fact that Lurgi was allowed to spend on the project without limit.

The plant is small, with an expected output of 37 million gallons annually, much less than other operations around the state. Barash said the value of product would be around $2 a gallon of ethanol, less than half the ultimate construction cost.

About $6 million worth of corn is stored at the plant, and state law provides payment to farmers for their grain. An estimated 50 people are out of work, and investor-farmers, are counting their losses as management plans to continue construction after reorganization.

According to attorney Barash, it’ll take about $25 million and about a months work to finish the plant, which the remaining management team is attempting to raise. Will it ever go on line? Probably, but Illinois Farm Bureau spokesman John Hawkins is quoted as saying companies are postponing or outright canceling their operations nationwide. He feels it just isn’t time yet to build an ethanol plant.

Source:  PJStar





About the Author

My home state is Illinois, and my hometown a little railroad/farming community named Galesburg.We lived on a small farm during my high school years and I became very aware of nature and it's wonders. I loved the out of doors, working with animals, plowing fields and harvesting crops. Those were very good years.After a stint in the Army during the Korean war my broadcasting career took off at the local radio station, a 250 watt "teapot" as it was called in those days. My first job was as an engineer, then the ham came out and I became an announcer/newsman, graduating after several years to a larger market and a stint as a TV journalist/photographer. Cold, wet weather led me to the southwest where I've lived for most of the last 40 years, with a couple of years out to have fun working as a private investigator in San Francisco, and a few years working in Las Vegas hotels and casinos. In all, its been a real ride.After retiring a few years back I became fascinated with the efforts being made to find alternative energy sources. I've watched our environment deteriorate during my lifetime, and now it's my chance to join the chorus of intelligent and caring individuals making a difference one day at a time.
  • Hi…Thanks for the nice read, keep up the interesting posts..what a nice Friday

  • Hi…Thanks for the nice read, keep up the interesting posts..what a nice Friday