October/November 2007 - Biofuels Canada Magazine

Northern Ethanol Inc. expands into Sarnia & Barrie

Article available at http://www.biofuelsmagazine.ca.

Northern Ethanol Inc.’s proposed $210 million Sarnia, Ontario, plant is expected to break ground in the first quarter of 2008. The new site will be built on 30 acres of land off of Vidal St. with construction slated to take up to 18 months. The facility will produce 400 MMly of ethanol and will take advantage of the city’s abundant supply of corn and its highly skilled workforce—creating approximately 350 new plant related jobs.

Initially, Northern Ethanol chose the Sarnia site due to its existing infrastructure which included natural gas, electricity, water, and sanitary sewers, and its accessibility by truck, train or ship. The company expects the facility will be in a strong position to serve the ethanol markets surrounding the Great Lakes including Ontario, Michigan, Ohio and New York.

“[The] next steps for the Sarnia project will be to work collaboratively with the City of Sarnia, submit for site plan approval and apply for environmental permits,” said Northern Ethanol Director of Corporate Relations, Natalie Horrell. “Our expected in-service date is late 2009.”

Northern Ethanol is also in the preliminary stages of building its first 400MMly corn-based ethanol plant in Barrie, Ontario. The site is the city’s former Molson Canada beer brewery. Once again, the site was chosen for its existing infrastructure and close rail, road and water access which will help provide the capital cost savings and shorter time-to-market span. The city also has proximity to gas fueling terminals and the Greater Toronto area. The Barrie facility will bring in 50 full-time jobs and between 150 and 200 indirect spin off jobs. Construction on the Barrie plant is expected to begin by mid 2008 and is scheduled to be fully operational in 2009.

According to Horrell, the company has run into some delays due to public concerns regarding health and safety issues. The company has attempted to alleviate these concerns through open houses and online question and answer sections on its website.

Northern Ethanol has kept a firm grasp on the key elements of its business strategy which include the exploitation of economies of scale and strategic acquisitions of existing or pending ethanol production facilities. “Upon successful construction of multiple manufacturing facilities in Canada and the U.S., we believe there are significant opportunities for cost savings in raw materials purchasing, transportation, engineering and operations which will provide a profitability advantage vis-à-vis other smaller and single-site ethanol producers,” Horrell said. “Our goal is to have four plants up and operating by 2010.”

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