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    SRI Consulting released a report on chemicals from biomass. The analysis highlights six major contributing sources of green and renewable chemicals: increasing production of biofuels will yield increasing amounts of biofuels by-products; partial decomposition of certain biomass fractions can yield organic chemicals or feedstocks for the manufacture of various chemicals; forestry has been and will continue to be a source of pine chemicals; evolving fermentation technology and new substrates will also produce an increasing number of chemicals. Chemical Online - November 27, 2007.

    German industrial conglomerate MAN AG plans to expand into renewable energies such as biofuels and solar power. Chief Executive Hakan Samuelsson said services unit Ferrostaal would lead the expansion. Reuters - November 24, 2007.

    Analysts think Vancouver-based Ballard Power Systems, which pumped hundreds of millions and decades of research into developing hydrogen fuel cells for cars, is going to sell its automotive division. Experts describe the development as "the death of the hydrogen highway". The problems with H2 fuel cell cars are manifold: hydrogen is a mere energy carrier and its production requires a primary energy input; production is expensive, as would be storage and distribution; finally, scaling fuel cells and storage tanks down to fit in cars remains a huge challenge. Meanwhile, critics have said that the primary energy for hydrogen can better be used for electricity and electric vehicles. On a well-to-wheel basis, the cleanest and most efficient way to produce hydrogen is via biomass, so the news is a set-back for the biohydrogen community. But then again, biomass can be used more efficiently as electricity for battery cars. Canada.com - November 21, 2007.

    South Korea plans to invest 20 billion won (€14.8/$21.8 million) by 2010 on securing technologies to develop synthetic fuels from biomass, coal and natural gas, as well as biobutanol. 29 private companies, research institutes and universities will join this first stage of the "next-generation clean energy development project" led by South Korea's Ministry of Commerce, Industry and Energy. Korea Times - November 19, 2007.

    OPEC leaders began a summit today with Venezuelan President Hugo Chavez issuing a chilling warning that crude prices could double to US$200 from their already-record level if the United States attacked Iran or Venezuela. He urged assembled leaders from the OPEC, meeting for only the third time in the cartel's 47-year history, to club together for geopolitical reasons. But the cartel is split between an 'anti-US' block including Venezuela, Iran, and soon to return ex-member Ecuador, and a 'neutral' group comprising most Gulf States. France24 - November 17, 2007.

    The article "Biofuels: What a Biopact between North and South could achieve" published in the scientific journal Energy Policy (Volume 35, Issue 7, 1 July 2007, Pages 3550-3570) ranks number 1 in the 'Top 25 hottest articles'. The article was written by professor John A. Mathews, Macquarie University (Sydney, Autralia), and presents a case for a win-win bioenergy relationship between the industrialised and the developing world. Mathews holds the Chair of Strategic Management at the university, and is a leading expert in the analysis of the evolution and emergence of disruptive technologies and their global strategic management. ScienceDirect - November 16, 2007.

    Timber products company China Grand Forestry Resources Group announced that it would acquire Yunnan Shenyu New Energy, a biofuels research group, for €560/$822 million. Yunnan Shenyu New Energy has developed an entire industrial biofuel production chain, from a fully active energy crop seedling nursery to a biorefinery. Cleantech - November 16, 2007.

    Northern European countries launch the Nordic Bioenergy Project - "Opportunities and consequences of an expanding bio energy market in the Nordic countries" - with the aim to help coordinate bioenergy activities in the Nordic countries and improve the visibility of existing and future Nordic solutions in the complex field of bioenergy, energy security, competing uses of resources and land, regional development and environmental impacts. A wealth of data, analyses and cases will be presented on a new website - Nordic Energy - along with announcements of workshops during the duration of project. Nordic Energy - November 14, 2007.

    Global Partners has announced that it is planning to increase its refined products and biofuels storage capacity in Providence, Rhode Island by 474,000 barrels. The partnership has entered into agreements with New England Petroleum Terminal, at a deepwater marine terminal located at the Port of Providence. PRInside - November 14, 2007.

    The Intergovernmental Panel on Climate Change (IPCC) kicks off the meeting in Valencia, Spain, which will result in the production of the Synthesis Report on climate change. The report will summarize the core findings of the three volumes published earlier by the separate working groups. IPCC - November 12, 2007.

    Biopact's Laurens Rademakers is interviewed by Mongabay on the risks of large-scale bioenergy with carbon storage (BECS) proposals. Even though Biopact remains positive about BECS, because it offers one of the few safe systems to mitigate climate change in a drastic way, care must be take to avoid negative impacts on tropical forests. Mongabay - November 10, 2007.

    According to the latest annual ranking produced by The Scientist, Belgium is the world's best country for academic research, followed by the U.S. and Canada. Belgium's top position is especially relevant for plant, biology, biotechnology and bioenergy research, as these are amongst the science fields on which it scores best. The Scientist - November 8, 2007.

    Mascoma Corporation, a cellulosic ethanol company, today announced the acquisition of Celsys BioFuels, Inc. Celsys BioFuels was formed in 2006 to commercialize cellulosic ethanol production technology developed in the Laboratory of Renewable Resources Engineering at Purdue University. The Celsys technology is based on proprietary pretreatment processes for multiple biomass feedstocks, including corn fiber and distiller grains. The technology was developed by Dr. Michael Ladisch, an internationally known leader in the field of renewable fuels and cellulosic biofuels. He will be taking a two-year leave of absence from Purdue University to join Mascoma as the company’s Chief Technology Officer. Business Wire - November 7, 2007.

    Bemis Company, Inc. announced today that it will partner with Plantic Technologies Limited, an Australian company specializing in starch-based biopolymers, to develop and sell renewably resourced flexible films using patented Plantic technology. Bemis - November 7, 2007.

    Hungary's Kalocsa Hõerõmû Kft is to build a HUF 40 billion (€158.2 million) straw-fired biomass power plant with a maximum capacity of 49.9 megawatts near Kalocsa in southern Hungary. Portfolio Hungary - November 7, 2007.

    Canada's Gemini Corporation has received approval to proceed into the detailed engineering, fabrication and construction phases of a biogas cogeneration facility located in the Lethbridge, Alberta area, the first of its kind whereby biogas production is enhanced through the use of Thermal Hydrolysis technology, a high temperature, high pressure process for the safe destruction of SRM material from the beef industry. The technology enables a facility to redirect waste material, previously shipped to landfills, into a valuable feedstock for the generation of electricity and thermal energy. This eliminates the release of methane into the environment and the resultant solids are approved for use as a land amendment rather than re-entering the waste stream. In addition, it enhances the biogas production process by more than 25%. Market Wire - November 7, 2007.

    A new Agency to manage Britain's commitment to biofuels was established today by Transport Secretary Ruth Kelly. The Renewable Fuels Agency will be responsible for the day to day running of the Renewable Transport Fuels Obligation, coming into force in April next year. By 2010, the Obligation will mean that 5% of all the fuels sold in the UK should come from biofuels, which could save 2.6m to 3m tonnes of carbon dioxide a year. eGov Monitor - November 5, 2007.

    Prices for prompt loading South African coal cargoes reached a new record last week with a trade at $85.00 a tonne free-on-board (FOB) for a February cargo. Strong Indian demand and tight supply has pushed South African prices up to record levels from around $47.00 at the beginning of the year. European DES/CIF ARA coal prices have remained fairly stable over the past few days, having traded up to a record $130.00 a tonne DES ARA late last week. Fair value is probably just below $130.00 a tonne, traders said. At this price, some forms of biomass become directly competitive with coal. Reuters Africa - November 4, 2007.

    The government of India's Harayana state has decided to promote biomass power projects based on gasification in a move to help rural communities replace costly diesel and furnace oil. The news was announced during a meeting of the Haryana Renewable Energy Development Agency (HAREDA). Six pilot plants have demonstrated the efficiency and practicability of small-scale biomass gasification. Capital subsidies will now be made available to similar projects at the rate of Rs 2.5 lakh (€4400) per 100 KW for electrical applications and Rs 2 lakh (€3500) per 300 KW for thermal applications. New Kerala - November 1, 2007.


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Thursday, November 29, 2007

VeraSun Energy and US BioEnergy announce merger agreement: combined ethanol capacity of more than 1.6 billion gallons

VeraSun Energy Corp. and US BioEnergy Corp. today announced they have entered into a definitive merger agreement, which has been unanimously approved by the board of directors of each company. The merger is expected to create a stronger business platform by improving access to capital and allowing the combined company to leverage technology and operating experience across its entire plant fleet. The merger is also expected to be accretive to VeraSun’s earnings in the first full fiscal year of combined operations, and the combined company is projected to have a market capitalization of approximately $1.5 billion.

Upon completion of the merger, the combined company will have nine ethanol production facilities in operation and seven additional facilities under construction (table, click to enlarge). By the end of 2008, the company is expected to have a total production capacity of more than 1.6 billion gallons (6.057 billion liters) per year, or roughy 73,000 barrels of oil equivalent per day, as well as 16 facilities constructed by Fagen, Inc. and utilizing ICM process technology. Through the merger, the employees of both companies will be integrated into a combined work force.

The merger is expected to close during the first quarter of 2008, pending shareholder approval, anti-trust regulatory clearance and the completion of other customary conditions. Under the merger agreement, 0.81 share of VeraSun common stock will be issued for each outstanding share of US BioEnergy common stock, representing a premium of approximately 11 percent based on November 23, 2007, closing prices. The existing VeraSun shares will remain outstanding and will represent approximately 60 percent of the shares outstanding after the merger:
:: :: :: :: :: :: :: ::
VeraSun Chairman, CEO and President Donald L. Endres will remain CEO of the combined company, and US BioEnergy President and CEO Gordon Ommen will serve as chairman following the closing of the merger. VeraSun Senior Vice President and Chief Financial Officer Danny C. Herron will become president of the combined company. The combined entity will retain the VeraSun name and trade under VeraSun’s existing NYSE ticker symbol, VSE.
This merger is an opportunity for two leading companies in the renewable fuels industry to capitalize on synergies and provide value for shareholders. It also underscores the commitment of each company to execute on its growth strategy to become a large-scale, low-cost ethanol producer. We are pleased with the opportunity to build a very unique industry platform. - Donald L. Endres, VeraSun Chairman, CEO and President
We’re excited about the merger because it brings together two talented and high-performing teams whose passion is to reduce our nation’s dependence on foreign oil through the production of clean renewable biofuels. By harnessing the collective strength of both organizations, we expect to reach 1.6 billion gallons of ethanol production capacity by the end of 2008, making us a global leader in ethanol production. - Gordon Ommen, US BioEnergy President and CEO
In connection with the merger, holders of a significant percentage of the outstanding shares of each company have agreed to vote in favor of the transaction.

Morgan Stanley & Co. Incorporated is serving as financial adviser, and Cravath, Swaine & Moore LLP is acting as legal counsel for VeraSun in the transaction. UBS Securities LLC is serving as financial adviser, and Skadden, Arps, Slate, Meagher & Flom LLP is acting as legal counsel for US BioEnergy in the transaction.

VeraSun Energy Corporation, headquartered in Brookings, SD, is a leading producer of renewable fuel. Founded in 2001, the company has 560 million gallons per year (MMGY) of production capacity through five operating ethanol production facilities in Aurora, SD, Fort Dodge, IA, Charles City, IA, Linden, IN and Albion, NE. Four facilities are currently either under construction or development in Hartley, IA, Welcome, MN, Reynolds, IN, and Bloomingburg, OH. Upon completion of the new facilities, VeraSun will have an annual production capacity of approximately one billion gallons. The company also has plans to extract oil from dried distillers grains, a co-product of the ethanol process, for use in biodiesel production.

The company markets E85, a blend of 85 percent ethanol and 15 percent gasoline for use in Flexible Fuel Vehicles (FFVs), directly to fuel retailers under the brand VE85. VeraSun now has approximately 150 VE85 retail locations under contract in over a dozen states and Washington, D.C.

US BioEnergy Corporation, based in St. Paul, Minn., is a producer and marketer of ethanol and distillers grains. Founded in 2004, the company currently owns and operates four ethanol plants in Albert City, IA, Ord, NE, Platte Valley, NE, and Woodbury, MI. Four additional ethanol plants are currently under construction in Marion; SD, Hankinson, ND, Dyersville, IA, and Janesville, MN. Upon completion of these initiatives, the company will own and operate eight plants with combined expected ethanol production capacity of 750 million gallons.

References:
VeraSun Energy: VeraSun Energy and US BioEnergy Announce Merger Agreement - November 29, 2007.


posted by Biopact team at 6:54 PM  

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