Cape ethanol plant may get summer start on construction

~ Another plant will be built near Sikeston, so some worry the area's corn supply will be strained.

Construction of a second new ethanol plant in Southeast Missouri could start as early as this summer on more than 100 acres along Nash Road and be fully operational 18 months later, officials said Wednesday.

Developer Phil Danforth of Leawood, Kan., has tried unsuccessfully for more than two years to raise money to build an ethanol plant in Cape Girardeau County and other Missouri communities.

But now Danforth is "seriously close" to securing funding for the $150 million plant to be built on Nash Road west of BioKyowa, said Mitch Robinson, executive director of the Cape Girardeau Area Magnet.

"There has never been any question that he is going to put a facility in the area," Robinson said. "I feel very confident the project is going to come through. I wouldn't be talking about it to the media if I didn't."

Danforth could not be reached for comment.

The news on Danforth's plant comes just four months after Bootheel Agri-Energy LLC, headed by Chaffee farmer David Herbst, announced its intentions to build a $175 million plant near Sikeston to manufacture 100 million gallons of ethanol per year. Ethanol plants produce grain alcohol that is added to gasoline to make a cleaner-burning fuel.

Herbst wouldn't comment on Danforth's ethanol plant. But he said the Bootheel plant is moving forward. A site near Sikeston has been selected, but Herbst said the deal on the land hasn't been signed yet. Bootheel Agri-Energy is also in the process of securing funding.

Agronomists and business leaders quietly worry that having two ethanol plants so close together could strain Southeast Missouri's corn supply. Two plants would require buying corn from other states, they said.

The Missouri Statistical Service estimates that the Southeast Missouri counties of Butler, Cape Girardeau, Dunklin, Mississippi, New Madrid, Pemiscot, Scott and Stoddard generate 64 million bushels of corn a year. A 100-million-gallon plant requires 36 million bushels a year.

As far as having enough corn, Herbst said there is enough to feed their plant. "We are very confident on that," he said.

Robinson said Magnet -- the not-for-profit economic development organization -- even has an option to buy 389 acres on Nash Road, at least 100 acres of which would be for Danforth's plant to manufacture the corn-based fuel.

Magnet has never before negotiated with property owners for business ventures of any sort, but Robinson said it's not unusual for economic development organizations to do so.

Magnet has had the option to buy the property for 90 days, though it would obviously be Danforth's corporation, Renewable Power, that purchases the land. The plant would generate 100 million gallons of ethanol a year and employ between 40 and 50 people, Robinson said.

Danforth is continuing to work with various large financial investment firms, Robinson said. He said that all of Danforth's investors are out of state, so the two ethanol plants shouldn't be seeking money from the same sources. Herbst said the Bootheel plant has only local investors.

Danforth also has tried to build an ethanol plant in Marshall, Mo., but farmers there were skeptical of his financing plan and elected to build their own 40-million-gallon plant. Earlier this week, the plant -- Mid-Missouri Energy -- announced it was doubling production.

If successful, this would be Danforth's first ethanol plant. Danforth is the retired chief of security for a jewelry company.

Regardless, everyone involved said the demand for ethanol is strong. Robinson said several other parties are interested in putting plants in Missouri, especially in light of the growing support of E85, a blend of ethanol and gasoline.

Supporters say ethanol-blended fuel tends to be less expensive than regular unleaded gasoline, and the auto industry has started marketing more cars and trucks capable of using E85. Congress has passed renewable fuel standards that increase the use of ethanol, and grant money is available to help install E85 pumps.

Still, Robinson said he wasn't sure if the two plants will create friction between the two groups planning to build them.

"I hope not," he said. "This would offer area farmers more opportunity to sell corn. That's what this should be about."

smoyers@semissourian.com

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