Canada Boosts Ethanol Funding; Five New Plants to Add 512M Liters/Year

6 July 2005

The Government of Canada has allocated a further C$46 million (US$ 37 million) for the construction or expansion of five ethanol plants across Canada. The funding comes as the second round of the Ethanol Expansion Program, which allocated C$72 million to six projects in its first round.

The new projects represent some 512 million liters per year of production capacity, and will increase total Canadian capacity to 1.4 billion liters (369.8 million gallons US) per year—seven times what it was prior to the beginning of the program and enough to meet the climate change target for ethanol production two years ahead of schedule.

Canada has a target of having 35% of all gasoline in Canada contain a blend of 10-percent ethanol by 2010. Additionally, the C$118 million in funding the Government of Canada has allocated under the EEP will result in close to a CAN $1-billion investment from the companies involved in the projects.

The following companies are receiving awards under Round 2 of the EEP:

• Commercial Alcohols Inc. (Canada’s largest ethanol producer.) C$15 million for a new plant in Windsor, Ontario; Annual capacity: 199 million liters.

• Husky Oil Marketing Company. (Husky is a major oil and gas producer.) C$10.4 million to build a plant in Minnedosa, Manitoba; Annual capacity: 130 million liters.

• Integrated Grain Processors Co-Operative Inc. C$11.9 million for a new plant in Brantford, Ontario. Annual capacity: 119 million liters.

• Permolex Ltd. C$1.1 million to expand its existing facility in Red Deer, Alberta; Expansion: 12 million liters annually, for a total of 40 million liters a year.

• Power Stream Energy Services Inc. C$7.3 million to convert a recently closed starch plant in Collingwood, Ontario. Annual capacity: 52 million liters.

The three projects in Ontario, combined with the projects that were allocated contributions under Round 1 of the EEP, are expected to increase ethanol production in the province to almost 800 million liters per year. This is enough capacity to meet the requirement, announced by the Government of Ontario, that gasoline sold in the province contain an average of five-percent ethanol by 2007.