Red Trail Energy LLC Press Release
Contact: (701) 974-4733
Frank Kirschenheiter
Bismarck, N.D. (March 10, 2005) - North Dakota Gov. John Hoeven and representatives from Red Trail Energy, LLC, announced today that Red Trail has surpassed the minimum amount of funding needed to break escrow for an ethanol plant near Richardton, N.D. Construction will begin on the plant as soon as possible.
“We have worked hard to develop a comprehensive program for ethanol in North Dakota, including marketing incentives, investment tax credits, and a counter-cyclical production incentive plan for new ethanol plants,” said Hoeven. “We are happy to see the Red Trail project moving forward and we will continue to find strategies to develop renewable energy sources such as ethanol, biodiesel, and wind.”
Project Coordinator Frank Kirschenheiter said, “Many people have put a lot of hard work into making this happen. We’re thankful to the state for its support and to the North Dakotans who had the foresight to invest in this project and turn its potential for our state into a reality. There’s a lot of money being made in ethanol processing in surrounding states, and now it’s our turn.”
To date, Red Trail has raised approximately $26.5, or about $1.5 million than it needed to complete financing from its lead lender and break ground. That amount includes $3.2 million from the state and $23.3 million from more than 500 individual investors.
Kirschenheiter said Red Trail will continue accepting investments until March 30, 2005. Investment in the Richardton plant is restricted to North Dakota citizens.
Red Trail has contracted with Greenway Consulting, LLC, Morris, Minn., a firm with extensive experience in the development, construction, management and operation of ethanol plants, to build and operate the plant. Renewable Products Marketing Group, Winthrop, Minn., will handle ethanol marketing. RPMG represents 14 ethanol facilities with an annual capacity of more than 500 million gallons. Commodity Specialists Co., Minneapolis, the world’s largest marketer of agricultural byproducts, will market the byproducts.
The Red Trail Energy plant, a 50 million gallon per year facility, will be located one mile east of Richardton. It will be operational 12-14 months after construction commences.
The plant will be a second-generation ethanol plant, and the first lignite-fired ethanol facility in the nation. “Second-generation” refers to the evolution of ethanol plant design in the past decade that has incorporated maximum efficiency.
The plant will consume 133,000 tons of North Dakota lignite each year, and Red Trail has locked in its energy costs with 10-year, fixed-base-rate contracts.
Red Trail is projected to spend $78.2 million on the Richardton plant, with $61 million expected for construction. It will result in 400 construction jobs and $6 million in construction wages. Once it is built, it will employ 36-38 people with an annual payroll in excess of $1.5 million.
Each year, the Red Trail plant will consume 18-20 million bushels of corn and produce 162,000 tons of dried distillers grain or 402,000 tons of wetcake, enough to support 220,000 feeder cattle.
Discussions for an ethanol plant near Richardton began with the Richardton Development Company (RDC) in December 2002. The RDC formed Red Trail Energy, LLC in July 2003 to raise funds to build and operate the plant.
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