Gevo, Redfield JV to retrofit US ethanol plant to isobutanol
Renewable chemicals and advanced biofuels firm Gevo has formed a joint venture with Redfield Energy to retrofit an existing ethanol plant in Redfield, S.D., into an isobutanol plant with an expected production capacity of 38mn gal/year.
The retrofit is expected to commence by year end 2011, and Gevo expects to begin commercial production of isobutanol at the facility in the fourth quarter of 2012, it said.
"This transaction demonstrates the attractiveness of our joint venture model for potential partners. Isobutanol production creates more value, and across diversified markets. Our partners see that and value it," said Patrick Gruber, CEO of Gevo.
"Redfield is an exceptionally well-run and profitable plant. We appreciate the vision and leadership of the Redfield board and its cooperative membership and look forward to working with them on this business."
Gevo will provide the technology and capital necessary to retrofit Redfield's existing 50mn gal/year ethanol facility and, in exchange, will receive an equity interest in Redfield.
This JV validates the attractive economics for both Gevo and Redfield and is consistent with Gevo's business plan, the company said.
"Isobutanol provides an excellent opportunity to expand our potential markets, improve our profit margins and create a more predictable and sustainable business," said Tom Hitchcock, CEO of Redfield. "We are very happy to be working with Gevo to upgrade our facility to a second-generation biorefinery."
Gevo broke ground on its first plant retrofit on May 31 in Luverne, Minn., and is expected to bring its isobutanol capacity online in the first half of 2012.
The Redfield plant will become Gevo's second production facility and is expected to bring total annual isobutanol capacity for 2012 to approximately 60mn gal/year.
In May 2011, Gevo announced a letter of intent for its third plant, also a JV, for an additional expected 50mn gal/year of isobutanol production.
Gevo plans to have approximately 110mn gal/year of isobutanol capacity online in 2013.
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