Osage Bio Energy to commence construction of barley ethanol plant in South Carolina

In South Carolina, Osage Bio Energy said that it would commence construction of its Congaree Bio Energy barley ethanol plant in Union County. Capacity for the $161 million project, one of four under development by the company and among the first barley ethanol plants in the world, was not disclosed. The company said that it will partner with Carlisle Finishing on the project, building the plant adjacent to the Carlisle Finishing textile plant, share a rail switch, and utilize steam from the textile plant.

Osage Bio Energy received a $300 million investment commitment for its barley-based ethanol production plan.  Texas-based First Reserve is providing the equity capital. The company’s plan uses barley, a low-input winter crop in the Southeast, as a feedstock.

Observers point out the higher production costs of barley ethanol and an indication from the USDA that its distillers grains may not be acceptable as livestock feed. The company indicated that two sites in North Carolina are finalists for its construction plan. Planned overall capacity was not disclosed, but the company’s initial [plant in Hopewell, VA is slated for 55 Mgy.

Osage Bio Energy received the go-ahead from municipal officials in December for its Hopewell plant. Ethanol experts had said the proximity of the town to the proposed plant raises the potential of smell and the traffic from trucks bringing in feedstocks, and the vote had been rated a toss-up by observers.

At the time Osage received its green light, the Chesapeake City Council voted 7-2 to turn down a proposal for a 237 Mgy ethanol plant proposed by International Bio Energy. The plant was proposed for a site on the Elizabeth River which was opposed by local residents in surrounding neighborhoods. The residents had raised concerns about emissions, water usage, and traffic.

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