BlueFire finds equity partner

By Dennis Seid | NEMS Daily Journal

FULTON – BlueFire Renewable’s ethanol plant took another step closer to production Monday after the company announced it had found an equity partner in China Huadian Engineering Co.
The Chinese company and California-based BlueFire will be equal partners in the deal.
Originally projected to be a $300 million project, the Fulton facility will cost a little more due to additional equipment and higher prices.
“Huadian is taking a 50 percent interest in BlueFire Fulton Renewables Energy,” said Arnold Klann, BlueFire’s CEO. “The cost has escalated due to the addition of a different boiler technology and commodity creep. The combination of debt of $125 million added to BlueFire’s contributed equity and now Huadian’s equity will close the transaction.”
The companies hope to close the deal by the end of the year. Once construction begins, it should take about 18 months to two years to complete. Site work was completed in June.
BlueFire said some 700 construction jobs would be created during construction of the plant. Once fully operational, it’s expected to employ 70 to 80 workers.
Company officials say the plant will produce up to 19 million gallons of ethanol a year from green and wood wastes abundantly available in the region.
Before the Huadian deal, BlueFire already had received $88 million in federal grants to help fund the plant.
In September 2010, BlueFire reached a 15-year deal with Tenaska BioFuels in which Tenaska would buy and market all of BlueFire’s production.
In BlueFire’s agreement with Huadian, the Chinese company said it could invest in up to five more ethanol plants in the U.S. The two companies also could work together on similar projects in China.
“Having such a strong partner, both technically and financially, backing up BlueFire, is a significant advancement in bringing BlueFire’s business plan to fruition,” Klann said.
China Huadian Engineering Co. is one of China’s largest utilities, generating more than 75,000 megawatts of power in China. Its parent company, China Huadian Corp., has over $51 billion in total assets.
dennis.seid@journalinc.com