Range Fuels, Inc. has received a loan note guarantee from the US Department of Agriculture (USDA) and closed its related $80 million bond issuance. (Earlier post.) The proceeds from the $80 million bond will be used to partially finance the first two phases of construction of Range Fuels’ first commercial cellulosic biofuels plant using renewable and sustainable supplies of non-food biomass near Soperton, Georgia.
The first phase is scheduled to be mechanically complete this month, with production scheduled to commence in the second quarter of this year.
The loan guarantee is the result of efforts between the USDA Office of Rural Development, AgSouth Farm Credit, ACA and Range Fuels. AgSouth Farm Credit, ACA, a leader in agricultural and rural loans and part of the Farm Credit System, was the lead lender on the loan, and Silicon Valley Bank and Morgan Keegan & Company, Inc. helped facilitate the financing of this bond transaction. A conditional commitment to provide this loan note guarantee was first issued by the USDA on 16 January 2009. The issuance of the loan note guarantee demonstrates Range Fuels’ compliance with the Agency’s conditions and successful structuring of the supporting financing.
The loan guarantee is a part of USDA’s Section 9003 Biorefinery Assistance Program authorized by the 2008 Farm Bill, which provides loan guarantees for commercial-scale biorefineries and grants for demonstration-scale biorefineries that produce advanced biofuels or any fuel that is not corn-based. The Biorefinery Assistance program is intended to assist in developing new and emerging technologies that produce advanced biofuels to increase the nation’s energy independence; promote resource conservation, public health, and the environment; diversify markets for agricultural products and waste material and spur rural economic development.