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Barley Ethanol Company Receives $300M Commitment from Private Equity Firm
8 May 2008
Osage Bio Energy (OBE), headquartered in Glen Allen, Virginia, has received a commitment of $300 million from First Reserve Corporation to fund the construction of four next generation bio-refining facilities that will produce ethanol and a specialty protein feed.
Osage Bio Energy is the sister company of Osage, Inc. (Roanoke, VA), the largest independent distributor of motor-fuel grade ethanol in the Southeast, with current throughput of approximately 100 million gallons per year.
OBE is positioning itself as different from corn-to ethanol production companies in several key ways.
First, the ethanol will primarily be produced from regionally grown barley. Currently, in the Mid-Atlantic and Southeast nearly five million acres per year remain fallow in winter months. Barley is a winter crop that will be grown for the production of ethanol and does not compete for land for food production. It requires less fertilization and prevents nutrient runoff in winter months.
The use of barley reduces the transportation requirements of moving Midwestern corn and enhances the yield of locally grown summer crops, especially soybeans. In addition, the co-product of barley-based ethanol, a protein meal, is superior feed supplement for local cattle, poultry and swine, according to Osage.
Second, OBE has negotiated an exclusive agreement with KATZEN International, Inc. for exclusive use of KATZEN technology capable of producing ethanol from barley within a 200-mile radius of each plant site.
Third, OBE’s site selection model provides energy balance advantages over corn-based ethanol, especially in the Mid-Atlantic and Southeast. OBE is committed to maximizing the opportunity to produce a truly renewable fuel by partnering with existing steam producers, utilizing its own waste products for energy and procuring locally grown biomass.
May 8, 2008 in Brief | Permalink | Comments (10) | TrackBack (0)
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Comments
I like the dual use of land and thought process of impact for different seasons, plus distribution aspects.
This seems to be a well planned alternative to corn.
Anyone else?
300M is quite a large investment. My next question would be how much more can they improve barley output per acre thru trangenics?
Posted by: Michael | May 8, 2008 9:37:53 AM
Presumably this venture is leveraging the work on hulless barley recommended by USDA Agricultural Research Service. This requires modified grain that is higher in starch than hulled barley and a fermentation process that utilizes pre-fermentation fractionation to remove non-fermentables. A brief look at Katzen International indicates they have refined this process and are offering it to growers like Osage Bio Energy.
Good work. Yet another viable resource for non-food related biofuel that will transition the ICE world to the electrified one.
http://www.katzen.com/coretech/ethanol/grain2.html
Posted by: gr | May 8, 2008 9:44:38 AM
Damn! There goes the price of beer.
Posted by: DS | May 8, 2008 11:51:20 AM
It would be nice if someone could figure out a way to incorporate the protein by-product of corn- and barley-to-ethanol processes, into food we can stand to eat.
Posted by: Alex Kovnat | May 8, 2008 12:10:27 PM
you mean the yeast byproducts?.. probably a good replacement for meat.. you could mix it with meat for palatability, with added fat.
Posted by: Herm | May 8, 2008 12:43:57 PM
I would rather use the barley straw, wheat straw, rice straw and corn stalks for fuel and use the grain for food and beverages, but that is just me.
Posted by: SJC | May 8, 2008 12:51:20 PM
Corn and grain protein byproducts are already in use as foods we consume. Beef, pork, veal and chicken are all gorged on the stuff daily. Trouble with previous barley byproducts is you need more than one stomach to digest it.
Posted by: gr | May 8, 2008 12:55:42 PM
DS:
The price of beer and most drinking alcohol, made from grain, will certainly go up.
Lets hope that farmers will not massively switch to corn & barley production to meet the 35 billion gallon ethanol a year target. If they do, (and they probably will) the price of all other grains will doubled again within a rather short time.
More similar endeavours will take place because it would take 100% of the corn produced in USA to feed the ethanol plants to the level required to produce 35 billion gallons/year.
Turning our gas guzzlers into ethanol guzzlers is not the most sustainable solution. There are much better ways to go. Vehicles efficiency have to be increased from 20 mpg to 60+ mpg. Improved Hybrids can do that; PHEVs can do much better and BEVs would not even use liquid fuel. A mix of all three technologies could turn our current low efficiency fleet (20 mpg) into a more sustainable (interim period) 100 mph fleet. As electrification moves in deeper and deeper, grain based ethanol plants could be shut down. Let's hpoe that the transistion can be accellerated before much more fertile land is used to feed our ethanol guzzlers.
Posted by: Harvey D | May 8, 2008 2:12:35 PM
Is there a way to create large hydroponic systems? Or large scalable aquaponic? I'm curious if there are savings by creating such systems in normally barren landscape, unused, but with large scale nursery like management. Would cost overwhelm the benefit?
Posted by: Michaeel | May 8, 2008 10:04:17 PM
EVs sound good and if they can produce billions of super cells cheaply wonderful. But I do not think that 50 million people will just trade in their cars and buy them in the next 5 years. This is a bit unrealistic. Liquid fuels and ICEs are with us and will be with us for a while. We need solutions that work with what we have not try to transform everything, that is less likely to happen. Providing renewable liquid fuels for ICE cars will not delay EVs. They will emerge on their own in their time on their own merits, not because we have to have them because we refused to do what needed to be done with liquid fuels.
Posted by: SJC | May 8, 2008 10:31:09 PM
